With no bill this year, Frank Lucas will file a short-term extension of current farm law. No farm bill in 2013

Farm bill negotiators conceded Tuesday that they will not finish their work before Congress goes home for the year, but insisted that they are close to a final deal and working toward floor action in early January.

“We are very confident that we are going to have an agreement,” Senate Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.) said. “We will be ready to vote in January.”


The next few days remain pivotal as lawmakers wait on final scores from the Congressional Budget Office related to the commodity title.

( Also on POLITICO: Full agriculture policy coverage)

A central question is how much freedom can be given farmers to reallocate crops within their base acres that will become the index for allocating future assistance. Those calculations have not yet been completed by the CBO and stand to have a huge impact — given the shifts already seen in the past decade from wheat to corn and soybeans, for example.

With no bill this year, House Agriculture Committee Chairman Frank Lucas filed a six-page short-term extension of current farm law through Jan. 31, 2014. Lucas said he wanted the House to have this option to consider before it goes home Friday. But if the CBO numbers fall into place, the Oklahoma Republican signaled he would be happy to leave the extension on the shelf.

“If it appears that it is possible to be ready to go on the floor that first week in January, then I’d be very hesitant,” Lucas said about the timing of a House vote on his extension. Nonetheless, he appears to be under some pressure from his leadership to have a fallback available. And his ranking Democrat, Minnesota Rep. Collin Peterson, said he would withhold judgment until Lucas has made a decision.

( Also on POLITICO: House eying short-term farm bill extension)

“I will withhold my judgment,” Peterson said. “I don’t want it to screw this up. I would like to vote against [the extension] if they bring it up, but I might not if I thought it would help us get a bill at the end of the day.”

Stabenow, for her part, is against any extension, preferring to keep the pressure on for a final deal and floor votes in January. But at this stage, she — like Peterson — does not seem to want to go to war over the issue and instead build on the progress already made in the talks.

The three lawmakers made their comments after a nearly hourlong meeting Tuesday in Stabenow’s office — also attended by Mississippi Sen. Thad Cochran, the ranking Republican on the Senate committee.

“We continue to make good progress,” Lucas said. “Our goal is to have an agreement that leads to a bill even if we, perhaps, we can’t get it done in the House this calendar week.”

“There’s no light between any of us here on our goal to get this done,” Stabenow said of the underlying farm bill. But tactically she and Senate Majority Leader Harry Reid (D-Nev.) are leery of getting into another extension, which they fear will invite more delay and even revive arguments over when Congress will end direct cash payments to farmers.

Indeed, the situation now is very different from a year ago, when Congress last had to deal with an extension. Back then, the House had not even acted on its farm bill; now, the two sides are in conference trying to reconcile two real bills into a final product in January.

The one constant is a continued fear of disruptions in the milk markets if there is no extension and the current dairy program is allowed to expire at New Year’s. But Stabenow said that Agriculture Secretary Tom Vilsack had assured the negotiators — in a phone call Tuesday — that there would be no reason for milk prices to spike if a farm bill can be put in place quickly in January. And that would be her goal.

“Get it ready,” she said, “So at the beginning of January, we can do our conference meeting and then move very quickly to pass the bill.”

“It’s my judgment that at least through the end of January we’re not in a spot where dairy prices are affected at all.”

Both she and Lucas shied away from discussing any details but each gave ground last week in an effort to reach some compromise.

For her part, Stabenow agreed to new savings from food stamps, chiefly by cracking down on states that seek to qualify more households for higher food stamp benefits through an abusive practice known as “heat and eat.”

Token amounts of low-income fuel assistance — sometimes as little as $1 per year — are distributed to beneficiaries thereby allowing them to claim a standard utility deduction of significant size in high-cost cities like New York, for example. Higher food stamp benefits can next be leveraged with this deduction, even in cases where the beneficiaries are already living in government supported housing where they pay only a fixed percentage of their income for rent.

As passed by the Senate, Stabenow’s bill tried to up the ante by setting a minimum threshold of $10 in fuel aid. The compromise now would more than double her savings by going to the House level of $20.

At the same time, Lucas moved more toward Stabenow in the commodity title by giving up his vision that future subsidies be paid on some percentage of a farmer’s planted acres each year. Instead, the bill will revert to a system of fixed base acres assigned to each farm but not subject to change from one planting year to the next.

Both the Senate’s revenue protection program and the House own countercyclical alternative will be tied to base acres. But a big question still is whether farmers, who have shifted from wheat to corn, for example, will be allowed to reallocate acres in their base to reflect this change.

This is the score not yet completed by CBO. But it has big implications given that corn prices have been falling and growers would almost certainly qualify for government subsidies next year under the Senate’s revenue plan. If anything, the CBO score will most likely understate this cost, since the budget office is working from a set of price assumptions that don’t reflect how much corn markets have dropped already.

Though it has received less attention to date, a new dairy program in the commodity title remains vital to the politics of the farm bill. Speaker John Boehner (R-Ohio) is personally involved and has aligned himself with powerful processors opposed to a supply stabilization plan backed by Peterson and Stabenow.

Boehner won the first round on the House floor last summer, substituting an alternative for the Peterson plan. But the Minnesota Democrat has warned that this policy won’t work and he would rather go back to some variation of the current dairy program than accept the Boehner-backed plan.

“We’re going to have a dairy title that works,” Peterson said. And he seemed to leave open that he knows he may not get what he first wanted. “My litmus test is if we are going to put a new policy in place, it’s got to work and doesn’t put the taxpayers on the hook.”