While far from over, the House version of the President’s reconciliation package—referred to by the President as the “One Big, Beautiful Bill”—contains significant improvements to the farm safety net. We have previously discussed in Southern Ag Today the dire need for an improved farm safety net for this crop year, either from a farm bill or through this process. As we write this, House leadership is still working to secure votes for passage. Once that happens, the Senate will need to pass their version of the bill. Assuming the House and Senate pass different bills, the differences would need to be reconciled and the conferenced bill would need to again be passed by both the House and the Senate before going to the President to be signed into law. This sounds daunting, but one of the key elements of reconciliation (and why it has been used by both parties) is that the Senate only needs a simple majority (51) to pass the bill, whereas a normal bill would require 60 votes.
The House reconciliation bill includes quite a few changes to the current 2018 Farm Bill that has been extended through September 30, 2025. In terms of the farm safety net, the two primary commodity programs—Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC)—are extended through the 2031 crop year. Most importantly, reference prices are increased 10% to 20% depending upon the commodity. Reference prices would also increase 0.5% annually beginning in 2031, recognizing the need to keep up with inflation in the future.
The ARC coverage guarantee would be increased from 86% of the benchmark to 90%, and the payment band would increase from 10% to 12.5%. The first change would make payments trigger sooner, and the second change would increase the amount of the payments. Loan rates for most commodities would also be increased.
Combined payment limits for ARC and PLC would be increased from $125,000 to $155,000 and would be adjusted annually for inflation. The bill would also eliminate the LLC penalty (i.e., eliminate the payment limit on pass-through entities while maintaining the payment limit on owners of the entity) as previously highlightedin Southern Ag Today.
Premium assistance for crop insurance would see increases for individual yield or revenue coverage across all coverage levels. The Supplemental Coverage Option (SCO) would also see an increase in premium subsidy from 65% to 80%.
The House bill also contains language to allocate a maximum of 30 million additional base acres to producers who have been planting more acres than they have base acres on farms.
The bill has many other agriculture related provisions, but those listed above—if enacted—would strengthen the producer safety net beginning with the 2025 crop.
Outlaw, Joe, and Bart L. Fischer. “Much Needed Producer Assistance in the House Reconciliation Bill.” Southern Ag Today 5(21.4). May 22, 2025. Permalink
Leave a Reply