[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]


                 A HEARING TO REVIEW FARM POLICY WITH 
                     UNDER SECRETARY ROBERT BONNIE

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                        GENERAL FARM COMMODITIES
                          AND RISK MANAGEMENT

                                 OF THE

                        COMMITTEE ON AGRICULTURE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            FEBRUARY 8, 2022

                               __________

                           Serial No. 117-29
                           
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                          


          Printed for the use of the Committee on Agriculture
                         agriculture.house.gov
                         
                                __________

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
48-997 PDF                 WASHINGTON : 2022                     
          
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                        COMMITTEE ON AGRICULTURE

                     DAVID SCOTT, Georgia, Chairman

JIM COSTA, California                GLENN THOMPSON, Pennsylvania, 
JAMES P. McGOVERN, Massachusetts     Ranking Minority Member
FILEMON VELA, Texas                  AUSTIN SCOTT, Georgia
ALMA S. ADAMS, North Carolina, Vice  ERIC A. ``RICK'' CRAWFORD, 
Chair                                Arkansas
ABIGAIL DAVIS SPANBERGER, Virginia   SCOTT DesJARLAIS, Tennessee
JAHANA HAYES, Connecticut            VICKY HARTZLER, Missouri
ANTONIO DELGADO, New York            DOUG LaMALFA, California
SHONTEL M. BROWN, Ohio               RODNEY DAVIS, Illinois
BOBBY L. RUSH, Illinois              RICK W. ALLEN, Georgia
CHELLIE PINGREE, Maine               DAVID ROUZER, North Carolina
GREGORIO KILILI CAMACHO SABLAN,      TRENT KELLY, Mississippi
Northern Mariana Islands             DON BACON, Nebraska
ANN M. KUSTER, New Hampshire         DUSTY JOHNSON, South Dakota
CHERI BUSTOS, Illinois               JAMES R. BAIRD, Indiana
SEAN PATRICK MALONEY, New York       JIM HAGEDORN, Minnesota
STACEY E. PLASKETT, Virgin Islands   CHRIS JACOBS, New York
TOM O'HALLERAN, Arizona              TROY BALDERSON, Ohio
SALUD O. CARBAJAL, California        MICHAEL CLOUD, Texas
RO KHANNA, California                TRACEY MANN, Kansas
AL LAWSON, Jr., Florida              RANDY FEENSTRA, Iowa
J. LUIS CORREA, California           MARY E. MILLER, Illinois
ANGIE CRAIG, Minnesota               BARRY MOORE, Alabama
JOSH HARDER, California              KAT CAMMACK, Florida
CYNTHIA AXNE, Iowa                   MICHELLE FISCHBACH, Minnesota
KIM SCHRIER, Washington              JULIA LETLOW, Louisiana
JIMMY PANETTA, California
SANFORD D. BISHOP, Jr., Georgia

                                 ______

                      Anne Simmons, Staff Director

                 Parish Braden, Minority Staff Director

                                 ______

      Subcommittee on General Farm Commodities and Risk Management

                     CHERI BUSTOS, Illinois, Chair

ANGIE CRAIG, Minnesota               AUSTIN SCOTT, Georgia, Ranking 
FILEMON VELA, Texas                  Minority Member
SALUD O. CARBAJAL, California        ERIC A. ``RICK'' CRAWFORD, 
TOM O'HALLERAN, Arizona              Arkansas
AL LAWSON, Jr., Florida              RICK W. ALLEN, Georgia
SANFORD D. BISHOP, Jr., Georgia      DAVID ROUZER, North Carolina
                                     TRACEY MANN, Kansas
                                     MARY E. MILLER, Illinois

              Joshua Tonsager, Subcommittee Staff Director

                                  (ii)
                             
                             C O N T E N T S

                              ----------                              
                                                                   Page
Bustos, Hon. Cheri, a Representative in Congress from Illinois, 
  opening statement..............................................     1
    Prepared statement...........................................     2
Scott, Hon. Austin, a Representative in Congress from Georgia, 
  opening statement..............................................     3
Thompson, Hon. Glenn, a Representative in Congress from 
  Pennsylvania, opening statement................................    17

                                Witness

Bonnie Hon. Robert, Under Secretary, Farm Production and 
  Conservation, U.S. Department of Agriculture, Washington, D.C..     4
    Prepared statement...........................................     6
    Submitted questions..........................................    37

 
   A HEARING TO REVIEW FARM POLICY WITH UNDER SECRETARY ROBERT BONNIE

                              ----------                              


                       TUESDAY, FEBRUARY 8, 2022

                  House of Representatives,
         Subcommittee on General Farm Commodities and Risk 
                                                Management,
                                  Committee on Agriculture,
                                                   Washington, D.C.
    The Subcommittee met, pursuant to call, at 10:00 a.m., via 
Zoom, Hon. Cheri Bustos [Chair of the Subcommittee] presiding.
    Members present: Representatives Bustos, Craig, Carbajal, 
O'Halleran, Lawson, Bishop, Spanberger, Pingree, Schrier, 
Austin Scott of Georgia, Crawford, Allen, Rouzer, Mann, 
Thompson (ex officio), Miller, LaMalfa, Johnson, Moore, and 
Fischbach.
    Staff present: Lyron Blum-Evitts, Prescott Martin III, 
Joshua Tonsager, Patricia Straughn, Trevor White, Erin Wilson, 
and Dana Sandman.

  OPENING STATEMENT OF HON. CHERI BUSTOS, A REPRESENTATIVE IN 
                     CONGRESS FROM ILLINOIS

    The Chair. Good morning, everyone. This hearing of the 
Subcommittee on General Farm Commodities and Risk Management 
entitled, A Hearing to Review Farm Policy with Under Secretary 
Robert Bonnie, will come to order.
    So, welcome, and thanks to everyone for joining today's 
hearing. After brief opening remarks, Members will receive 
testimony from our witness today, and then the hearing will be 
open to questions. In consultation with the Ranking Member and 
pursuant to Rule XI(c), wait, is it XI(c) or XI(e)? Sorry. My 
vision is bad. XI(e), I am sorry, XI(e). I want to make Members 
of the Subcommittee aware that other Members of the full 
Committee may join us later.
    Today's hearing to review farm policy with USDA's Under 
Secretary for Farm Production and Conservation, Robert Bonnie, 
is an important opportunity for Members of this Subcommittee to 
share with USDA what our farmers back home are experiencing, as 
well as to hear updates on the status of programs under our 
jurisdiction.
    During the past year, this Subcommittee has held a series 
of sessions, listening to our important stakeholders so we can 
keep a pulse on what is happening on the ground in farm 
country. We have held a hearing with a group of farmers, a crop 
insurance agent, and an ag economist to get a better 
understanding of how our farm safety net programs are working. 
What we learn from those is critically important as we evaluate 
how programs are working.
    We know that the pandemic has continued to impact all of 
society, including supply chain disruptions that have led to 
higher input costs for farmers. And farmers across the country 
have been experiencing more and more extreme weather events; a 
polar vortex, historic drought, multiple hurricanes, and 
tornados, in December no less.
    There are a variety of critical programs designed to help 
farmers through these tough times. I hear through pretty much 
every ag meeting that I have how important the Federal Crop 
Insurance Program is to help farmers manage this risk.
    Congress has also provided significant disaster funding to 
provide additional support for producers hit by extreme 
weather, funding for which was requested by the Biden 
Administration last September. And commodity programs like ARC, 
PLC, and marketing assistance loans have been important safety 
net options for producers, with several enhancements to those 
programs made in the last farm bill.
    And just yesterday, Secretary Vilsack announced an 
important new initiative, the Partnership for Climate-Smart 
Commodities, which will help develop new marketing 
opportunities for farmers.
    Under Secretary Bonnie, I look forward to hearing your 
testimony and getting a sense of what you've been hearing and 
how the programs you oversee are working to address the 
economic and growing conditions farmers have been experiencing.
    [The prepared statement of Mrs. Bustos follows:]

 Prepared Statement of Hon. Cheri Bustos, a Representative in Congress 
                             from Illinois
    Today's hearing to review farm policy with USDA's Under Secretary 
for Farm Production and Conservation, Robert Bonnie, is an important 
opportunity for Members of this Subcommittee to share with USDA what 
our farmers back home are experiencing as well as to hear updates on 
the status of programs under our jurisdiction.
    During the past year, this Subcommittee has held a series of 
sessions, listening to our important stakeholders so we can keep a 
pulse on what's happening on the ground, in farm country.
    We have held a hearing with a group of farmers, a crop insurance 
agent, and an ag economist to get a better understanding of how our 
farm safety net programs are working.
    What we learn from those is critically important as we evaluate how 
programs are working.
    We know that the pandemic has continued to impact all of society, 
including supply chain disruptions that have led to higher input costs 
for farmers.
    And farmers across the country have been experiencing more and more 
extreme weather events; a polar vortex, historic drought, multiple 
hurricanes, and tornados, in December no less.
    There are a variety of critical programs designed to help farmers 
through tough times.
    I hear through pretty much every ag meeting I have how important 
the Federal crop insurance program is to help farmers manage their 
risk.
    Congress has also provided significant disaster funding to provide 
additional support for producers hit by extreme weather, funding for 
which was requested by the Biden Administration last September.
    And commodity programs like ARC, PLC, and marketing assistance 
loans have been important safety net options for producers, with 
several enhancements to those programs made in the last farm bill.
    And just yesterday, Secretary Vilsack announced an important new 
initiative, the Partnership for Climate-Smart Commodities which will 
help develop new marketing opportunities for farmers.
    Under Secretary Bonnie, I look forward to hearing your testimony 
and getting a sense of what you've been hearing and how programs you 
oversee are working to address the economic and growing conditions 
farmers have been experiencing.
    I would now like to welcome the distinguished Ranking Member, the 
gentleman from Georgia, Mr. Austin Scott, for any opening remarks he 
would like to give.

    The Chair. I would now like to welcome the distinguished 
Ranking Member, the gentleman from Georgia, Mr. Austin Scott, 
for any opening remarks that he may have.

  OPENING STATEMENT OF HON. AUSTIN SCOTT, A REPRESENTATIVE IN 
                     CONGRESS FROM GEORGIA

    Mr. Austin Scott of Georgia. Thank you, Chair Bustos, and I 
also would like to thank Under Secretary Bonnie for being here 
today, and congratulate you on your confirmation to head up the 
Farm Production and Conservation mission area.
    Over the past 5 years, that mission area has been extremely 
busy with implementation of the 2018 Farm Bill, disaster 
assistance, working to combat illegal tariffs from China, and 
protect the food supply in the face of disruptions due to 
COVID. I hope that we use our lessons learned from these past 
couple of years as we go into the next farm bill to help 
improve on all of those areas.
    I grew up working on a farm, and owned several hundred head 
of cattle with my grandfather at one point. But today, I am 
part of the 98 percent of Americans whose primary connection to 
agriculture is eating every day. Only two percent of the people 
in this country are classified as farm producers. That comes 
from a pretty broad definition, and I want everybody to 
understand that anybody who has the potential to produce $1,000 
in sales in this country by definition is considered an ag 
producer. The reality is there are about 200,000 full-time 
farmers and farms, most of which are family-owned, that are 
responsible for producing about 85 percent of the food supply 
in this country. I want to say that again: 200,000, or 
approximately \1/10\ of 1 percent of the American population, 
are farm families who are responsible for 85 percent of the 
food supply that we consume on a daily basis. That is a very 
small line of producers that stands between us being self-
reliant and us being dependent on foreign countries for our 
groceries.
    That is why I think it is critical that we have an 
effective farm safety net, and that we have open and honest 
discussions about where our food supply comes from and the 
danger of disrupting that from some of the policies that are 
being promoted by the extreme left.
    Mr. Secretary, I look forward to hearing your comments and 
your concerns today. I want to thank you for appearing before 
us. I look forward to additional oversight as we push forward 
in these years, and I again want to charge the Committee with 
making sure that we are taking care of America's food supply.
    With that, Madam Chair, I yield back.
    The Chair. Thank you to our Ranking Member, Mr. Scott.
    The chair would request that other Members submit their 
opening statements for the record so our witness may begin his 
testimony, and ensure that there is ample time for questions. 
With that, I would like to introduce Under Secretary Robert 
Bonnie. He oversees the mission area that houses the Farm 
Service Agency, Risk Management Agency, Natural Resources 
Conservation Service, each of which plays a critical role in 
delivering programs and assistance for producers across the 
country.
    Prior to joining USDA, Mr. Bonnie was at Duke University, 
and also worked at the Bipartisan Policy Center. This is Mr. 
Bonnie's second time serving in a confirmed position at USDA, 
having previously been Under Secretary of Natural Resources and 
Environment during the Obama Administration. And he has also 
served in senior staff roles at USDA under both the Obama and 
Biden Administrations. He brings a deep wealth of knowledge and 
experience to his position.
    Welcome, Under Secretary Bonnie. We look forward to hearing 
your testimony. You will have 5 minutes, and you will see that 
there is a timer that should be visible to you on your screen, 
and will count down to 0, at which point your time will have 
expired. Under Secretary Bonnie, please begin when you are 
ready.

    STATEMENT OF HON. ROBERT BONNIE, UNDER SECRETARY, FARM 
 PRODUCTION AND CONSERVATION, U.S. DEPARTMENT OF AGRICULTURE, 
                        WASHINGTON, D.C.

    Mr. Bonnie. Madam Chair, Ranking Member Austin Scott, I 
appreciate the opportunity to be with you today to discuss farm 
bill implementation and USDA's ongoing work to serve America's 
farmers, ranchers, and forest owners.
    While COVID-19 continues to present challenges for in-
person staffing of USDA offices, our staff have continued to do 
their jobs at full capacity. Indeed, we have implemented 
several new pandemic programs on top of our existing farm 
safety net and conservation programs. As we navigated the 
pandemic, our priority has been on the safety of our staff. 
FPAC has deployed an incident management team to monitor the 
spread of the disease and to adjust staffing accordingly.
    COVID-19 is not the only challenge that American 
agriculture faces. Between 35 to 40 percent of the contiguous 
U.S. experienced severe to exceptional drought last year. The 
region hardest hit was the West, in which 80 percent 
experienced severe to exceptional drought. In response, USDA 
both updated the ELAP Program to help cover the costs of 
transporting feed for livestock that rely on grazing, and 
lowered the drought intensity threshold that triggers 
assistance.
    FSA is now moving quickly to deliver $10 billion provided 
by Congress in additional disaster assistance to agricultural 
producers impacted by wildfire, droughts, hurricanes, winter 
storms, and other eligible disasters from 2020 and 2021. In 
implementing this law, our goals are to reduce the paperwork 
burden on producers, ease agency administrative burdens while 
maintaining accountability, and encourage producers to use 
existing safety net programs by linking assistance to them.
    USDA will follow a two-phase process to administer relief 
to eligible producers with the first phase utilizing a 
streamlined process that relies on existing data that producers 
have already provided to USDA. We plan to distribute at least 
half of the $750 million for livestock through the first phase 
by the end of March.
    With increasing extreme weather, crop insurance remains a 
vital tool for agriculture. RMA continues to develop and expand 
its offering to row crops, fruits and vegetables, and other 
parts of agriculture. We recently announced a micro-farm policy 
to ensure we are helping producers of all sizes. We developed 
and implemented a Pandemic Cover Crop Program to incentivize 
use of cover crops across 12 million acres. We recently 
announced an additional insurance coverage for corn farmers who 
split-apply nitrogen, a cost effective and environmentally 
friendly practice.
    Agriculture has a vital role to play in mitigating 
greenhouse gases. Fortunately, many of the practices that 
benefit the climate also improve agricultural and forest 
productivity. USDA's approach to climate change for agriculture 
and forestry will be voluntary, incentive-based, producer-led, 
and grounded in science.
    Yesterday, the Secretary announced the Partnership for 
Climate-Smart Commodities funding opportunity. Using CCC 
dollars, USDA will partner with agriculture and forestry to 
scale the adoption of climate-smart practices associated with 
commodity production, and quantify and verify the climate gains 
from these pilot projects. Our goal is to de-risk the adoption 
of climate-smart practices so that farmers, ranchers, and 
forest owners can benefit from the development of emerging 
markets for climate-smart commodities.
    We are in the midst of the 2022 crop year signup for ARC-
PLC, an important safety net program that provides critical 
support to mitigate fluctuations in either revenue or prices 
for certain crops. In November 2021, we issued $1.8 billion in 
payments for producers for the 2020 crop year, and we are on 
pace for enrollment this year with a deadline for signup in the 
middle of March.
    We are committed to making USDA's farm and conservation 
programs available to all farmers and ranchers and forest 
owners. Last August, FSA published the final rule for the Heirs 
Property Relending Program to help producers and landowners 
resolve heirs property and land ownership and succession 
issues. All three FPAC programmatic agencies are increasing 
outreach and assistance in historically underserved 
communities.
    Beginning farmers and ranchers represent more than \1/4\ of 
the farming population, but have historically experienced more 
difficulty obtaining assistance from USDA. FPAC will continue 
to prioritize assistance to these farmers and ranchers. 
Likewise, urban agriculture is of growing importance, as FSA 
now has 11 urban county offices focused on programs and 
engagement with producers, and we just announced the membership 
of the Urban Agriculture Federal Advisory Committee.
    I look forward to your questions today, and thank you again 
for having me.
    [The prepared statement of Mr. Bonnie follows:]

    Prepared Statement of Hon. Robert Bonnie, Under Secretary, Farm 
     Production and Conservation, U.S. Department of Agriculture, 
                            Washington, D.C.
    [Chair] Bustos, Ranking Member Scott, and Members of the 
Subcommittee, it is a pleasure to meet with you today in my new 
capacity as Under Secretary for Farm Production and Conservation 
(FPAC).
    My name is Robert Bonnie, and I was honored to serve during the 
Obama Administration as Under Secretary for Natural Resources and 
Environment and as a senior advisor to Secretary Vilsack. With that 
experience I have had the opportunity to see both the possibilities and 
the challenges that define American agriculture. As I focus on my new 
role within the FPAC Mission Area and survey the breadth of what we 
have accomplished in partnership with Congress, I am pleased to report 
that we continue to meet the evolving challenges our producers face 
through implementation of the 2018 Farm Bill provisions, the 
establishment of pandemic response programs, and administration of 
disaster programs.
2018 Farm Bill Update
    First, I want to thank this Committee for working tirelessly to 
improve the farm economy through the 2018 Farm Bill and subsequent 
provisions. Strengthening the farm safety net has been even more 
critical during this pandemic, and the improvements from the 2018 Farm 
Bill that FPAC agencies have implemented set the foundation for new 
programs and changes to meet the toll that the pandemic has taken on 
our producers.
Crop Insurance
    The tools Congress provided in the 2018 Farm Bill further 
strengthened crop insurance programs, and I'm glad to report that 
producers have already benefited from these improvements to this strong 
public-private partnership. I am pleased to share a few of these 
improvements that are helping support the crop insurance safety net for 
farmers, who face increasingly severe weather patterns due to climate 
change. For instance, the Risk Management Agency (RMA) now provides 
coverage for rice growers who use innovative irrigation practices such 
as alternative wet-dry and furrow irrigation. Producers now have the 
ability to insure land in multiple counties through Multi-County 
Enterprise Units--recognizing the practical realities that farms often 
cross county lines and insurance should accommodate that. We 
implemented the Quality Loss Option to reduce the impact quality losses 
have on a producer's future crop insurance coverage. We developed a new 
nursery policy that is easier for producers to access and for insurance 
companies to sell and service, a new policy for strawberries in Florida 
and California, and a new Micro Farm Policy targeted at providing a 
crop insurance policy for smaller producers who sell locally, such as 
for farmer's markets. We also introduced Hurricane Insurance 
Protection--Wind Index (HIP-WI) for the Gulf Coast, Eastern Seaboard, 
and Hawaii that provides prompt payment to producers when a hurricane 
hits. Lastly, the Pasture, Rangeland, and Forage insurance program now 
has over 200 million acres insured compared to under 100 million in 
2018.
    RMA continues to work with stakeholders, private insurance 
providers, and the Federal Crop Insurance Corporation Board of 
Directors to develop new, innovative, and financially-sound policies 
and plans of insurance to adapt to the changing risk management needs 
of farmers and ranchers that have thus far resulted in 40 new insurance 
products to further strengthen the crop insurance program. Recent 
examples include Dairy Revenue Protection (DRP) that has only been 
offered for a few years but now already covers 30 percent of the milk 
production in the U.S., the Enhanced Coverage option that allows 
producers to purchase up to 95 percent levels of coverage, and key 
policy changes and subsidy increases to the Livestock Risk Protection 
(LRP) plan to bring those policies in line with row crops. The changes 
made to LRP have resulted in a remarkable increase of over 1,000 
percent program participation.
    In addition to the increased participation in DRP, RMA is also 
seeing growing participation in the Livestock Gross Margin for Dairy 
Cattle and producers who purchase crop insurance for their specialty 
and organic crops. This is a testament to our work with producers and 
interest groups to strengthen the farm safety net and the public-
private partnerships that enable us to deliver crop insurance.
Farm Programs
    The 2018 Farm Bill reauthorized the Agriculture Risk Coverage (ARC) 
and Price Loss Coverage (PLC) programs with some modifications for the 
2019 through 2023 crop years. The ARC program is an income support 
program that provides payments when actual crop revenue declines below 
a specified guarantee level. The PLC program provides income support 
payments when the effective price for a covered commodity falls below 
its effective reference price. Payments, if triggered, are issued after 
October 1 of the year following the program year. When comparing ARC/
PLC participation from its authorization in the 2014 Farm Bill and 
inaugural program year 2014 to program year 2019, enrollment increased 
by 8.7% and a total $6,281,422,160 was issued in payments for 2019, 
making it the largest amount since the 2016 program year. For program 
year 2020, enrollment increased by 10.6% and payments were issued in 
the amount of $2,162,805,971.
    On March 2, 2020, the Farm Service Agency (FSA) published changes 
to the Noninsured Crop Disaster Assistance Program (NAP) as required by 
the 2018 Farm Bill. The 2018 Farm Bill made the buy-up coverage option 
for NAP permanent, with the payout limit for buy-up coverage increased 
to $300,000. It also codified that NAP coverage must include local, 
organic, contract, or other premium prices, and maintained the fee 
waiver and 50 percent premium discount for beginning, socially 
disadvantaged (SDA), and veteran farmers.
    The farm bill also made NAP available to producers when limited 
insurance coverage or only Whole-Farm Revenue Protection is available 
and directed FSA and RMA to collaborate to collect and share data so 
that RMA can develop policies that address gaps in coverage for NAP 
users so both agencies can help transition crops and counties from NAP 
to crop insurance. This includes helping beginning farmers use NAP as 
an on-ramp to Federal crop insurance. Since program year 2019, nearly 
$400 million has been paid to producers enrolled in NAP, who otherwise 
would have been left without risk management coverage through RMA for 
crop losses due to low yields, loss of inventory, or prevented planting 
due to natural disasters.
    On February 26, 2020, FSA published a rule making changes in its 
supplemental disaster programs as directed by the 2018 Farm Bill. These 
changes include removing the payment limitation for the Emergency 
Assistance for Livestock, Honey Bees, and Farm-raised Fish Program 
(ELAP), and increasing the payment rate for beginning and veteran 
farmers and ranchers in both ELAP and the Tree Assistance Program 
(TAP). Under changes made by the Bipartisan Budget Act of 2018 there is 
also no longer a program year per person and legal entity payment 
limitation for TAP and growers are eligible to be partly reimbursed for 
losses on up to 1,000 acres per grower. This is double the initial 
acreage cap of 500 acres that was first set for the program in 2014. 
ELAP has paid out over $170 million to producers since program year 
2019, while TAP has provided over $8 million in much-needed relief.
Dairy Programs
    The 2018 Farm Bill replaced the Margin Protection Program with 
Dairy Margin Coverage (DMC) to ensure that dairy farmers can protect 
themselves against financial catastrophe and market fluctuations. DMC 
is a voluntary program that provides dairy operations with risk 
management coverage that offers protection against low milk prices, 
high feed costs, or some combination of both and pays participating 
producers when the difference (the margin) between the national price 
of milk and the average cost of feed when it falls below a certain 
level selected by the producer. As of January 18, 2022, DMC indemnity 
payments since the 2018 Farm Bill total over $1.64 billion, of which 
$1.19 billion was from 2021 alone when the program provided vital 
support to dairy farms, particularly for small- and mid-sized 
operations, navigating low milk prices and high feed prices in 2021.
    As part of a subsequent effort by Congress to help the dairy 
industry respond to the pandemic and other challenges, the Consolidated 
Appropriations Act established Supplemental Dairy Margin Coverage 
Payments for calendar years 2021-2023. These payments are limited to 
farms enrolled in DMC with a production history of less than 5,000,000 
pounds, reflect increases in their production since 2014. In a December 
2021 rule, FSA implemented those changes that expanded DMC allowing 
producers to enroll supplemental production that will provide an 
estimated $644.52 million to better help small- and mid-sized dairy 
operations. In line with 2022 DMC sign-up, enrollment for this 
Supplemental Dairy Margin Coverage Payment opened on December 13, 
20201, and will remain open through February 25, 2022. As of January 
18, 2022, approximately $20.6 million was disbursed for 2,369 
operations with established supplemental production history.
    Additionally, the 2018 Farm Bill directed USDA's National 
Agricultural Statistics Service (NASS) to begin collecting data on 
premium alfalfa prices for the first time. Using that new NASS data, in 
the December 2021 rule USDA changed the DMC feed cost formula to better 
reflect the actual cost dairy farmers pay for high-quality alfalfa hay. 
FSA is now calculating payments using 100% premium alfalfa hay rather 
than 50%. Approximately $100 million in DMC payments have been 
disbursed due to changes in feed cost formula to better reflect the 
actual cost fairy farmers pay for high-quality alfalfa hay. In that 
same December 2021 rule, USDA also amended Dairy Indemnity Payment 
Program regulations to compensate dairy producers for the loss of cows 
due to contamination, including from per- and polyfluoroalkyl 
substances.
Farm Loan Programs
    The 2018 Farm Bill doubled the Direct Farm Ownership (FO) loan 
limit from $300,000 to $600,000 and Guaranteed FO loan limit increased 
from $700,000 to $1,750,000, which then increased to $1,825,000 on 
October 1, 2021. The Direct Operating Loan (OL) limit was raised from 
$300,000 to $400,000 and the Guaranteed OL limit from $700,000 to 
$1,750,000, which, again, was increased to $1,825,000 on October 1, 
2021. FSA has seen a significant increase in the average loan amount 
since the enactment of the increased loan limits. Providing much needed 
financial assistance to our borrowers.
    While this authority has been helpful to farm loan borrowers, the 
increased loan limits put demand on the total loan levels provided. 
USDA continues to monitor this situation and uses the annual 
appropriation's authority to increase negative subsidy rate loan levels 
by 25 percent when needed. This has been beneficial to meet borrowers' 
needs, especially during CRs and within the constraints of our 
targeting requirements.
    Through an amendment to the Consolidated Farm and Rural Development 
Act (CONACT), the 2018 Farm Bill increased the percent of the FSA 
guarantee for Guaranteed FO and OL from 90 to 95 percent for a 
qualified Beginning or Socially Disadvantaged (SDA) farmer.
    Previously, lenders could only receive a 95 percent guarantee under 
limited circumstances such as refinancing FSA direct loan debt or 
participating in the Direct FO Down Payment Loan Program. The increase 
in the guaranteed loan percentage provides lenders more incentive to 
extend credit to these farmers, a traditionally underserved group.
    Guaranteed operating loan activity has varied since this change was 
implemented. Guaranteed FO activity has increased in the last several 
years but declined in Fiscal Year (FY) 2019.
    Prior to the 2018 Farm Bill, borrowers who received debt 
forgiveness were ineligible for emergency loans; however, a 2018 Farm 
Bill amendment to CONACT allows borrowers who have received debt 
restructuring with a write down to maintain eligibility for emergency 
loans. This change addresses the concern that borrowers who have 
experienced a disaster, through no fault of their own, are suddenly 
unable to receive financial assistance and continue their operations.
    Borrowers who have received prior debt forgiveness through 
restructuring with a write down still have viable operations and FSA 
can now extend assistance in the form of emergency loans to those 
current and past borrowers who have suffered from a disaster. While 
there are other ways debt forgiveness can be obtained through FSA, the 
2018 Farm Bill expanded emergency loan eligibility only to those whose 
debt forgiveness was in conjunction with an approved debt restructuring 
plan. FSA has made 213 emergency loans to 96 borrowers who previously 
received a debt write down as a component of loan restructuring.
    On August 9, 2021, the final rule of the Heirs' Property Relending 
Program (HPRP) was published in the Federal Register outlining the 
availability of competitive loan funds to help agricultural producers 
and landowners resolve heirs' property land ownership and succession 
issues. Intermediary lenders--cooperatives, credit unions, and 
nonprofit organizations certified as a community development financial 
institution--can receive up to $5 million at one percent interest for 
relending to heirs to resolve property issues. This includes the costs 
of remedying clouded title issues or buying out partial property 
interests of other heirs.
    The first application period closed on October 29, 2021, and FSA 
received three loan applications totaling $12,000,000. Selection of 
successful eligible intermediary lenders is expected to be announced in 
early 2022. As part of its efforts to expand intermediary lender 
participation and assist heirs, prior to the next application period 
FSA will undertake an assessment of potential barriers to participation 
and identify what outreach and technical assistance it can provide to 
increase program interest. The program has a positive subsidy rate and 
unused funds carryover to the next fiscal year. Currently, FSA has 
approximately $128 million available.
Beginning Farmers and Ranchers
    Beginning farmers and ranchers represent more than \1/4\ of the 
farming population and our work in this space builds on previous 
successes and lessons learned while looking ahead to emerging issues in 
agriculture. The 2018 Farm Bill contained several key provisions that 
USDA has leveraged in support of the next generation of farmers and 
ranchers.
    In implementing the provisions of the 2018 Farm Bill, the Beginning 
Farmer and Rancher Coordinator responsibilities were delegated to FSA 
who has since hired a full time National Coordinator to lead efforts 
across the department and support agencies with new farmer-focused 
program delivery at the local level. For example, the National 
Coordinator partnered with FSA's Farm Loan Program staff to increase 
and improve lending through the Direct and Guaranteed lending programs. 
We hosted a Beginning Farmer and Rancher Lending Summit that resulted 
in an ongoing collaboration between FSA and our commercial lending 
partners. FSA is also working with a variety of commercial lending 
stakeholders to identify process and policy enhancements that will 
improve guaranteed lending to beginning farmers.
    The Beginning Farmer State Coordinator implementation began in 2019 
and was fully implemented in 2020. As outlined in the 2018 Farm Bill, 
each state has a collateral duty coordinator from one of the FPAC 
agencies or through USDA Rural Development. Each state has an annual 
Beginning Farmer plan and reports quarterly on the goals and metrics 
they identified for prioritization based on the needs of new farmers in 
their state. State coordinators have been instrumental in helping 
beginning farmers access and navigate USDA programs.
    USDA hosted a listening session in May 2021 for beginning farmers 
to share how the pandemic has disrupted and impacted their operations 
as well as provide general feedback on how our programs could better 
serve them. The participants made recommendations on how our programs 
could be improved and communicated the value of having local staff who 
can work with them directly. We are using this feedback to continue to 
improve the delivery of programs during this difficult time.
    The Farm Bill of 2018 laid a firm foundation for success, and FPAC 
utilized the tools provided by Congress to meet the unique needs of 
producers since its passage. While no one wrote the farm bill with an 
upcoming pandemic in mind, we were well positioned to meet the 
challenges of this once in a generation challenge.
Pandemic Assistance
    As the Committee well knows, agriculture is an inherently risky 
business, complicated further by the impacts of the ongoing COVID-19 
pandemic. In response, USDA initially rolled out the Coronavirus Food 
Assistance Program (CFAP) to provide financial assistance to producers 
of agricultural commodities who suffered certain price declines or who 
had losses due to market supply chain disruptions due to COVID-19.
    To address gaps and disparities in previous rounds of aid, this 
Administration provided $6 billion in funds through the Pandemic 
Assistance for Producers Initiative, a suite of pandemic and disaster 
assistance programs designed to help producers absorb increased 
marketing costs, with greater emphasis on outreach to small and 
socially disadvantaged producers, specialty crop and organic producers, 
and timber harvesters.
    Pandemic Assistance for Producers provided approximately $280 
million in payments to contract producers of eligible livestock and 
poultry. This is in addition to financial assistance provided through 
the Pandemic Livestock Indemnity Program to support producers of 
eligible swine, chickens, and turkeys as a result of insufficient 
access to processing facilities, and up to $50 million in Spot Market 
Hog Pandemic Program funds to support producers who sold hogs through a 
spot market sale.
    Timber harvesters and haulers, who experienced losses of at least 
ten percent gross revenue in 2020 in comparison to 2019, received $200 
million in relief as part of the Pandemic Assistance for Timber 
Harvester and Haulers program.
    Organic and transitioning organic producers are receiving up to $20 
million in assistance under the Organic and Transitional Education and 
Certification Program to cover eligible certification and education 
expenses.
    Through the Pandemic Cover Crop Program, RMA distributed almost $60 
million in crop insurance premium support, covering over 12 million 
acres, to producers who insured their spring crop with most insurance 
policies and planted a qualifying cover crop during the 2021 crop year.
    Since January 2021, we also suspended past-due debt collections and 
foreclosures for distressed borrowers under the Farm Storage Facility 
Loan and the Direct Farm Loan programs until further notice due to the 
pandemic. FSA also extended deadlines for producers to respond to loan 
servicing actions, including loan deferral consideration for 
financially distressed and delinquent borrowers. Where possible, we 
made flexibilities available to lenders through our Guaranteed Loan 
program to assist in servicing their customers. Additionally, the 
Department suspended non-judicial foreclosures, debt offsets or wage 
garnishments, referring foreclosures to the Department of Justice 
(DOJ); and is working with the U.S. Attorney's Office to stop judicial 
foreclosures and evictions on accounts that were previously referred to 
the DOJ.
Disaster Assistance
    On top of the monumental effort of supporting America's producers 
during this historic pandemic, this Administration has, time and again, 
responded to the immediate needs of producers in the wake of natural 
disasters.
    FSA made important changes to the ELAP. First, in response to the 
winter storms that hit states along the Gulf Coast in early 2021, we 
made food fish and other aquatic species eligible for assistance. 
Second, in response to the severe drought in the West and Great Plains, 
we lowered the drought intensity threshold to trigger assistance for 
water hauling expenses and began accepting applications to cover the 
cost of transporting feed for livestock that rely on grazing. FSA also 
made available an online tool to help ranchers document and estimate 
payments to cover feed transportation costs resulting from the drought.
    To further mitigate the impact of the drought in the West, FSA 
invested $15 million in a block grant in August 2021 to provide 
payments to producers in the Klamath Basin to reduce irrigation demand 
in parts of California and Oregon.
    FSA is also issuing $1.8 billion in payments to producers who 
enrolled in the ARC and PLC programs, distributed more than $292 
million through the Quality Loss Adjustment Program, and $3.1 billion 
under the Wildfire and Hurricane Indemnity Program Plus as appropriated 
through the Additional Supplemental Appropriations for Disaster Relief 
Act, 2019.
    In addition, Congress called upon our Mission Area again to deliver 
$10 billion in disaster assistance for 2020 and 2021 losses funded 
through the Extending Government Funding and Delivering Emergency 
Assistance Act, 2021. Internally we are moving quickly to put programs 
in place to support farmers and ranchers and we understand the 
importance of this assistance.
    RMA worked with crop insurance companies to streamline and 
accelerate the adjustment of losses and issuance of indemnity payments 
to crop insurance policyholders in areas impacted by the 2021 drought 
as well as authorizing Approved Insurance Providers to extend deadlines 
for premium and administrative fee payments and defer and waive the 
resulting interest accrual as well as providing flexibilities under LRP 
for producers who had to sell livestock earlier than expected. Over $7 
billion in indemnities have been paid to date for the 2021 crop year 
with over $5 billion resulting from drought.
    Through RMA's HIP-WI, producers have received more than $270 
million in indemnity payments in addition to coverage provided through 
underlying policies.
    I would like to recognize our staff for all the great work they 
accomplished to provide this much-needed disaster assistance, as well 
as pandemic assistance. I recognize that it is critical to have our 
offices staffed to administer programs and get dollars out the door 
during difficult times like these, so expanding our staffing capacity 
remains a top priority for this Administration.
Climate-Smart Agriculture & Forestry
    Farmers, ranchers, forest landowners, and land managers are on the 
front-lines of climate change. Now more than ever we need to ensure 
they have access to the tools, incentives, and support to build and 
enhance resilient operations and continue to play a critical role in 
addressing the climate crisis.
    While USDA has not historically been at the center of the public 
conversation on Federal climate policy, it has enormous and 
underappreciated discretionary financial resources and agency 
expertise. This Administration seeks to harness these resources and 
expertise to partner with farmers, ranchers, and forest owners to 
reduce atmospheric greenhouse gases through carbon sequestration and 
emissions reductions and bolster the resilience of private working 
lands and public forests and grasslands to the effects of climate 
change.
    To that end, USDA has developed an ambitious department-wide plan 
for climate action, focused on partnering with agriculture, forestry, 
tribes, businesses and communities. Our efforts are based on voluntary, 
incentive-based approaches. Our plan centers on leveraging our existing 
programs, on creating new opportunities and markets for climate-smart 
agriculture and forestry, on ensuring rural America plays a key role in 
our transition to cleaner sources of energy, and helping producers and 
communities adapt to the impacts of climate change--adverse weather, 
increasingly severe drought, storms, and flooding. We've developed an 
Action Plan for Climate Adaptation and Resilience that identifies the 
most significant risks that climate change poses to the agriculture and 
forestry sectors and lays out Department-scale actions to best prepare 
our stakeholders to address these current and future climate change 
threats. We're also investing in research and development to make sure 
that we have the innovative technologies, data and quantification tools 
required to best position producers in this effort.
    As an important component of this comprehensive climate strategy, 
USDA has been working to prepare Partnerships for Climate-Smart 
Commodities to finance the deployment of climate-smart farming and 
forestry practices to aid in the marketing of climate-smart 
agricultural commodities. In response to public and stakeholder 
feedback, this opportunity will finance the production of climate-smart 
commodities through a series of partner-led large-scale pilots. Project 
partners will support producers to grow agricultural commodities using 
climate-smart practices, implement a plan to market these commodities, 
and measure and validate the resulting climate benefits. It is critical 
that a wide cross-section of agriculture is involved in this effort, 
including small, medium, and historically underserved producers.
    In FY 2020 and 2021 NRCS provided the following:

   $330 million through the Regional Conservation Partnership 
        Program (RCPP) and an additional $75 million in RCPP 
        Alternative Funding Arrangements, with 75% of these investments 
        supporting activities that advance the Department's Climate-
        Smart Agriculture and Forestry priorities;

   $41.8 million through the Environmental Quality Incentive 
        Program to help agricultural producers in the West mitigating 
        impacts from climate change by implementing practices to 
        alleviate the immediate impacts of drought and other natural 
        resource challenges on working lands;

   $21 million as part of a collaboration with the Department 
        of [the] Interior's WaterSMART Initiative to improve our water 
        conservation and drought resilience;

   More than $46 million through the Joint Chiefs' Landscape 
        Restoration Partnership for projects that mitigate wildfire 
        risk, improve water quality, and restore healthy forest 
        ecosystems on public and private lands;

   $15 million through the Conservation Innovation Grants 
        program to support the development of new tools, approaches, 
        practices, and technologies to further natural resource 
        conservation with a focus on climate-smart strategies and $25 
        million for On-Farm Conservation Innovation Trials.

    To target climate impacts, FSA has made several improvements to the 
Conservation Reserve Program (CRP), including providing higher rental 
rates to increase producer interest and enrollment; establishing a new 
Climate-Smart Practice Incentive for CRP general and continuous signups 
to increase carbon sequestration and reduce greenhouse gas emissions; 
and rolling out a CRP Climate Change Mitigation Assessment Initiative 
to measure program climate impacts and increase climate outcomes over 
time.
    These changes paid off. In 2021, producers enrolled more than 5.3 
million acres in CRP through the General, Continuous, and Grassland 
signups, surpassing USDA's 4 million acre goal.
    One of the most important strategies for farmers to increase 
climate resilience is improving soil health, and this Administration 
has made critical investments to support that goal. Earlier this year, 
NRCS announced a new partnership with Farmers for Soil Health to 
advance the use of soil health practices--especially cover crops--on 
corn and soybean farms. To complement the new partnership, NRCS is 
investing $38 million through a new targeted Cover Crop Initiative to 
help agricultural producers mitigate climate change through the 
widespread adoption of cover crops.
    Additionally, NRCS' Soil Health Demonstration Trial, part of the 
Conservation Innovation Grants On-Farm Conservation Innovation Trials, 
focuses extensively on implementation of conservation practices and 
systems that improve soil health.
    Early this year, RMA implemented the Post Application Coverage 
Endorsement that provides coverage to producers in select counties in 
the Midwest who ``split apply'' nitrogen, added flexibility for 
producers to hay, graze, or chop cover crops and still receive 100% of 
the prevented planting payment, and provided a $5 per acre premium 
benefit for producers who planted cover crops.
Equity
    Equity is a vital consideration in all we do at USDA. We must 
ensure that the programs we support and the investments we make are 
available to everyone and that we take special steps to ensure that 
historically underserved and small- and medium-sized farmers are able 
to participate and prosper from our work.
    President Biden issued an Executive Order On Advancing Racial 
Equity and Support for Underserved Communities Through the Federal 
Government \1\ and committed to creating an Equity Commission as part 
of his rural agenda and commitment to closing the racial wealth gap and 
addressing longstanding inequities in agriculture. USDA is in the 
process of standing up an independent Equity Commission to reduce 
barriers to access, in which FPAC will be highly involved with the 
subcommittee on Agriculture. The Commission will provide 
recommendations to the Secretary on policies, programs, and actions 
needed to address racial equity issues within the Department of 
Agriculture and its programs, including strengthening accountability at 
USDA and to provide recommendations to the Secretary on broader more 
systematic equity issues at USDA.
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    \1\ https://www.whitehouse.gov/briefing-room/presidential-actions/
2021/01/20/executive-order-advancing-racial-equity-and-support-for-
underserved-communities-through-the-federal-government/.
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    FPAC was also active in USDA's first-ever Racial Justice and Equity 
Internal Working Group to identify gaps and inadequacies in the 
Department's systems and processes.
    With the over $1 billion provided from the American Rescue Plan 
Act, the Department will focus on creating opportunities for 
historically underserved producers through technical assistance and 
capacity building, access to land and credit, and access to markets and 
market development and FPAC will be crucial for that work.
    We currently provide approximately $75 million to 20 organizations 
to provide technical assistance to connect underserved producers with 
USDA programs and services, $50 million in cooperative agreements to 
support historically underserved farmers and ranchers with climate-
smart agriculture, $4.7 million in cooperative agreements for FSA 
outreach and education, $6.6 million in urban agriculture grants and 
cooperative agreements, and $2 million in cooperative agreements for 
risk management education and training programs that support 
historically underserved producers and small-scale farmers.
Conclusion
    It is clear that when Congress, FPAC, and producers work together, 
we can accomplish great things. The 2018 Farm Bill created a foundation 
that allowed us to strengthen and adapt our programs to meet the 
dynamic needs of our producers. The FPAC workforce took the tools 
provided by Congress, listened to producers, and implemented and 
adapted our programs to meet their needs. We have overcome significant 
challenges and will continue to do so.
    I look forward to working with this Subcommittee, the Committee, 
and Congress at large to ensure America's producers can weather any 
challenges they face--whether it be a once-in-a-lifetime global 
pandemic, or the annual challenges faced as the result of a changing 
climate--to build back a better food system.

    The Chair. All right. Thank you very much, Under Secretary 
Bonnie.
    At this time, Members will be recognized for questions in 
order of seniority, alternating between the Majority and the 
Minority. What we will do is you will each be recognized for 5 
minutes in order to allow us to be able to get to as many 
questions as possible. As a reminder, please keep your 
microphones muted until you are recognized so we can keep down 
the background noise.
    So, I am going to start by recognizing myself for 5 
minutes.
    Under Secretary Bonnie, yesterday Secretary Vilsack 
announced a new Partnership for Climate-Smart Commodities. You 
just talked about that. I appreciate the thoughtful approach 
that USDA has taken by first seeking formal input from 
stakeholders last fall about what such an initiative could look 
like, and taking that input in creating this initiative. The 
Food and Agriculture Climate Alliance, which is chaired by the 
American Farm Bureau Federation, the National Farmers Union, 
Environmental Defense Fund, and National Council of Farmer 
Cooperatives, and dozens of other stakeholder organizations as 
participants have put out a statement commending USDA on this 
announcement and said they were pleased the program is 
structured in a manner consistent with the recommendations. It 
is obvious that a wide variety of stakeholders were asking for 
this sort of initiative.
    As this will use funding from the CCC, Under Secretary 
Bonnie, can you please talk about the authorities that are 
being used for this?
    Mr. Bonnie. The Commodity Credit Corporation, part of the 
role of the CCC is to promote domestic consumption of domestic 
agricultural products by helping to expand markets, including 
the creation of new markets. And that is essentially what we 
are doing with this program. This is a commodity program. This 
is a program on working lands to link climate-smart practices, 
to incentivize climate-smart practices as part of commodity 
production, and then to measure and monitor that. So, we think 
we have a very strong link to the CCC, and as you say, we have 
spent a lot of time with agriculture trying to design something 
that we believe will work for both agriculture and forestry.
    The Chair. So, the last Administration used CCC Section 5 
authority to spend $23 billion over 2 years on direct payment 
programs to producers called the Market Facilitation Program to 
offset the impacts of retaliatory tariffs, a program which 
essentially paid out to producers based on the level of price 
drops of each commodity. For the Climate-Smart Commodities 
Initiative that Secretary Vilsack rolled out yesterday, can you 
clarify how much is being spent and is it fair to say that this 
initiative will help to build new marketing opportunities for 
farmers and add value to their products?
    Mr. Bonnie. So, we have committed $1 billion to this, and 
as the Secretary noted yesterday, these are pilot projects. We 
are very confident we will be able to deliver on all the things 
the CCC needs to be able to deliver on as we move forward. And 
yes, the idea there is emerging interest in greening company 
supply chains, looking at the opportunity for agriculture and 
forestry to reduce greenhouse gas emissions. We are hoping to 
spur private investment in that to de-risk this in a way that 
the private-sector and agriculture can partner together on this 
important issue.
    The Chair. All right, thank you.
    During last month's hearing with Secretary Vilsack, he 
indicated that RMA would roll out another round of Pandemic 
Cover Crop Program for the 2022 season soon, and it appears 
that a final rule on the program has been sent to OMB for 
review.
    My home State of Illinois has a pilot project that also 
provides premium discount support for the planting of cover 
crops, which was complimented by PCCP last summer. It is a very 
popular program for producers back home, and I am wondering if 
you have any sense of when that program will be rolled out for 
2022?
    Mr. Bonnie. Well, we are moving as quickly as we can. We 
know producers need to make those decisions quickly, and so, I 
will commit to you that we are, we are moving as quickly as we 
can.
    We were actually surprised by the amount of interest. We 
had originally thought we would be around 5 million acres, as I 
noted in my testimony, it is close to 12 million acres. And I 
know we learned something from Illinois, which is why we 
thought about this program in the first place.
    The Chair. All right, very good.
    I am going to try to squeeze in one more question.
    I am co-chair of the Congressional Crop Insurance Caucus, 
and I understand the critical importance that the Federal Crop 
Insurance Program plays in making sure that we are helping 
farmers manage their risk. Would you take the remaining time 
that I have to talk about efforts that USDA has to expand the 
availability of crop insurance products for commodities, and 
for more regions in the country?
    Mr. Bonnie. Crop insurance is absolutely critical, and you 
know, over the last several years, RMA has worked to create new 
policies, new opportunities for producers in all types of crops 
and livestock, and in different regions of the country, 
different types of operations, whole farm, micro farm, and 
others. We will continue that effort, look for those gaps, 
continue to look for ways that we can expand this vital tool.
    The Chair. All right, very good. Thank you, Under Secretary 
Bonnie. My time has expired.
    I now recognize the gentleman from Georgia, Mr. Austin 
Scott, our Ranking Member.
    Mr. Austin Scott of Georgia. Thank you, Chair Bustos and 
Under Secretary Bonnie.
    Are you familiar with The New York Times op-ed video series 
on America's food supply that they have titled, Meet the People 
Getting Paid to Kill Our Planet?
    Mr. Bonnie. I am.
    Mr. Austin Scott of Georgia. And it goes on to say American 
agriculture is ravaging the air, soil, and water, and then goes 
to a pretty great length to demonize America's farm families.
    What are your thoughts on those comments in that video 
series demonizing America's farm families?
    Mr. Bonnie. I thought it was a horrible video. I think 
farmers, ranchers, and forest owners are great stewards of our 
land. I think they all depend on the productivity of the land 
which comes from stewardship. Agriculture has the opportunity 
to be a critically important partner; in fact, it is already 
stepping out in climate, water quality, wildlife, and other 
ways. I was very disappointed with the video.
    Mr. Austin Scott of Georgia. I, for one, want to thank you 
for your comments.
    I am very disappointed in it, too, and in fact, it is 
outright--it is just flat out lying about the American farm 
families. If we don't take care of the land, the land won't 
take care of us, and people work very hard to put that food 
supply on the shelves for Americans to enjoy on a daily basis. 
And American farm families are facing unprecedented challenges 
right now. Commodity prices are better, but look at the price 
of diesel. Look at the price of inputs. And I am very concerned 
about the continued attacks from the extreme left, and I don't 
expect you to comment on this because it is not fair to ask you 
to comment on this. But when you see someone like Senator Cory 
Booker, who if I am not mistaken, sits on the Agriculture, 
Nutrition, and Forestry Committee in the U.S. Senate, making 
the statements that he has about America's farm families, that 
is very disappointing to me that somebody in the U.S. Senate 
would become an extremist opposing America's farm families. So, 
I won't ask you to comment on that, but I did want to get that 
out. I hope that the Members of the Committee will take the 
opportunity to watch that video, and please do it when you are 
not in a bad mood so that you don't break something.
    Under Secretary, the concern I have right now with 
America's producers is two-fold. I understand that the raw 
materials to make the chemicals are here that we need in our 
crop protection products to get the yields that we have, but 
even if we get the yields that we have and commodity prices are 
strong, the input costs are so high, and as you said, most of 
our safety nets are based on the actual commodity price. And 
so, commodity prices may be very good and farmers still lose 
tremendous sums of money.
    What safety nets are out there today that protect the 
farmers in those scenarios under which commodity prices are 
good, but the input costs are so high that they still lose 
money, in many cases, more money?
    Mr. Bonnie. Yes. I mean, you are exactly right. Most of our 
commodity programs are based on yield and prices. The one 
exception is the Dairy Margin Program, which takes into account 
the costs of feed. I think the best thing we can do right now 
is make sure we move quickly on disaster; move quickly on the 
programs we have, to make sure agriculture is in as good a 
situation as it can be to address this.
    Mr. Austin Scott of Georgia. Well, one of the things I 
would point out to the Committee is if you are not farming 
today, you are not going to be farming tomorrow. You might be 
one of those producers that is putting $1,000 worth of produce 
on the shelf or $10,000 worth of produce on the shelf, but if 
you are not part of that \1/10\ of 1 percent that is putting 85 
percent of America's groceries on the shelf today, you are 
probably not going to be in that number a year from now or 10 
years from now. And so, I am very concerned about the false 
narrative from the extreme left, and even Members of Congress 
that are attacking those farm families that are responsible for 
our food supply.
    And so, Under Secretary, I look forward to working with 
you. I do think that we are going to have some things that we 
are going to have to do in the future that maybe we haven't had 
to do. And when I say future, I mean short future where we have 
good commodity prices, but the input costs are so high that the 
farmers and our farm families lose tremendous sums of money. 
And so, I look forward to working with you on those solutions.
    And with that, Madam Chair, I will yield the last 10 
seconds and ask people to take a look at what the extremists 
had to say in that video.*
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    * Editor's note: the video referred to is retained in Committee 
file, and is available at https://www.nytimes.com/video/opinion/
100000008091680/climate-sustainability-agriculture-lobby.html.
---------------------------------------------------------------------------
    The Chair. Thank you, Mr. Scott.
    I now recognize the gentlewoman from Minnesota, Ms. Craig, 
for 5 minutes.
    Ms. Craig. Well, thank you so much, Chair Bustos and 
Ranking Member Scott, for the focus of today's hearing. Thank 
you, Under Secretary. I appreciate you being here today, and 
especially for your leadership within USDA.
    As conversations around the next farm bill ramp up, I am 
hearing from farmers and ranchers in my district about a couple 
of key topics, including risk management, cover crop and 
conservation programs, as well as commodity programs. With 
those topics in mind, I am going to dive right into those 
questions.
    First on risk management. I consistently hear from 
producers that Federal crop insurance works. It works well for 
them, and that the program does not need major changes. Given 
the significant amount of ad hoc disaster relief funding that 
has been made available to producers in recent years, can you 
talk a little bit about the role crop insurance agents have 
played in helping to deliver that assistance, as well as 
efforts USDA has undertaken to expand coverage options in the 
crop insurance program?
    Mr. Bonnie. Crop insurance is a public-private partnership. 
We partner with the agents, the insurance companies to deliver 
it, and maintaining that partnership is critically important. 
And I think as we look at the future of crop insurance, as I 
noted earlier, we have developed a lot of programs, 
opportunities for producers. We will continue to look at ways 
that we can refine and improve those, and we will continue to 
look at gaps in coverage where we can create new products or 
new opportunities in partnership with agriculture.
    So, crop insurance remains absolutely vital, and as we 
think about disaster programs, one of the things we are doing 
as we roll out the disaster assistance, this $10 billion, is we 
are linking Phase 1 to participation in crop insurance, 
participation in NAP, participation in Livestock Forage 
Program, so that producers have an incentive to go to those 
programs and utilize those programs. I think that is one of the 
best ways that we can encourage folks to use those existing 
programs.
    Ms. Craig. Second, thank you so much for that. Related to 
crop insurance a little bit more, I was encouraged to see RMA's 
recent announcement on PACE. Is USDA currently evaluating any 
other crop insurance policies, and do any of those evaluations 
include a similar sustainability angle?
    Mr. Bonnie. I can get back to you on precisely the policies 
we are looking at right now. One of the things that was 
attractive about the PACE that split-application nitrogen 
brought forward with support from corn growers, along with 
others--I think we look for opportunities to create those new 
products that will create incentives, whether it is for 
sustainability, climate, or otherwise. I think that in all 
those cases this has to work for agriculture. We have to 
develop tools that work for agriculture that folks can embed 
into their existing operations. So, I think that is going to be 
an important filter for all these efforts.
    Ms. Craig. Finally, I really appreciate the work the 
Department has taken on to ensure that farmers utilize the 
commodity programs, that they are a part of the solution to 
addressing climate change.
    Two brief questions on these programs. First, how does USDA 
plan to continue to support these programs within the context 
of the circular economy that Secretary Vilsack mentioned last 
month, and then second, different crops, of course, involve 
different growing practices. Minnesota, of course, is the 
number one state in the country for sugar beet production, and 
we are proud of it. How does USDA plan to ensure that a wide 
range of commodity production systems and crops, like sugar 
beets, are included in climate efforts at the Department?
    Mr. Bonnie. When it comes to climate change, we want to be 
outcome oriented and we don't want to dictate practices. We 
want this to be producer-led. We want to allow different 
cropping systems, different types of agriculture, livestock, 
and allow for creativity and innovation. And so, I think as we 
think about climate, what is going to be really, really 
important is to allow everybody to participate: small, medium, 
large, historically underserved. I think that that is going to 
be of critical importance to how we design these programs.
    Ms. Craig. Mr. Under Secretary, thank you so much. We got 
through a lot in a very short period of time.
    So, with that, Madam Chair, I yield back.
    The Chair. Thank you, Ms. Craig.
    I now recognize the Ranking Member of our full House 
Agriculture Committee, Mr. G.T. Thompson from the State of 
Pennsylvania.

 OPENING STATEMENT OF HON. GLENN THOMPSON, A REPRESENTATIVE IN 
                   CONGRESS FROM PENNSYLVANIA

    Mr. Thompson. Madam Chair, thank you so much. I apologize, 
I had some technical difficulties getting on here. Technology 
is wonderful. I am so looking forward to getting back to all of 
our hearings in person because it just can be a challenge 
sitting in your office in Washington, D.C.
    But thank you for this hearing. Thank you and the Ranking 
Member.
    Under Secretary Bonnie, thank you for Zooming in with us 
today. It has been 23 months since the pandemic lockdowns 
began, and across America, particularly in rural America, 
producers are operating business as usual, and thank God for 
that, because of how they provide us our food, our fiber, a lot 
of energy resources, and building materials.
    Yet, USDA is still limiting FSA offices to just 25 percent 
of their personnel, and limiting or even preventing farmers 
from going in to the physical office. I hear from farmers, not 
just in my Congressional district, quite frankly, all across 
the country, that this has had a negative impact on their 
ability to sign up for programs and get information, and they 
have had enough. When can we expect FSA offices to return to 
their full staffing capacity?
    Mr. Bonnie. So, we have an incident command team that is 
tracking daily levels of COVID by county. Yesterday, we moved 
804 offices from 25 percent to 50 percent staffing. As omicron 
abates, we expect to be able to move very quickly as the data 
changes.
    I understand the challenges here. We hear the same thing 
you do, and we will work to move as quickly as we can to 
reopen.
    Mr. Thompson. Well, Mr. Secretary, you do understand 
Americans will be starving to death if the good, hardworking 
folks that work the fields, the farms, the forests, if they had 
that same philosophy. It is time to go back to work.
    Yesterday, USDA announced $1 billion for what the 
Department calls Partnerships for Climate-Smart Commodities to 
be funded by the CCC, and I have to say, first of all, I did 
have a conversation with the Secretary on Friday, expressed my 
frustrations with the Department for basically working as a 
lone wolf, working as a maverick. That is not the way we do 
things in agriculture. We use a farm team and to be kept in the 
dark, basically 48, 72 hours before this announcement and yes, 
he had given me a heads up before that they were working on 
this, but between it was just absolute radio silence as opposed 
to engaging the Legislative Branch. We are the ones that 
authorize programs. You all are the ones that execute those. I 
am not sure some of you folks recognize that line, the 
leadership.
    Now, the Secretary reiterated his authority to use CCC 
funds is because the program is focused on U.S. commodities' 
market expansion, and that is a legitimate use. In yesterday's 
announcement, however, the Department reiterated this point, 
stating, and I quote, ``All projects must be tied to the 
development of markets and the promotion of climate-smart 
commodities.'' The Secretary also noted how this program could 
lead to a USDA climate-smart label, which is, again, something 
we would want to be working with you on, not having you do this 
alone.
    Mr. Under Secretary, what the Secretary has described is a 
commodity marketing program. That is why I am somewhat confused 
to learn the NRCS was the agency issuing the notice of funding 
availability. It seems like the Department is trying to fit a 
square peg into a round hole to avail yourselves of the CCC 
authorities and funds. And frankly, to me, this looks like a 
conservation program dressed up as a marketing program.
    Now, as I continue to question USDA's authority to do this 
absent Congressional action, I am also very concerned that this 
money will not directly benefit producers. And in the end, I 
think hopefully we are all in agreement that whatever we do in 
a climate space should primarily and right up-front benefit our 
farmers, our ranchers, and our foresters.
    But we haven't had the opportunity to really weigh in on 
what you all announced just a couple days ago. These and many 
other concerns are going to lead this Committee to engage in 
extensive oversight of this program, its funding stream, its 
implementation, its operation. I just wish we would have 
engaged earlier. I am not expecting any kind of a comment or 
response, I just wanted to lay out my disappointments in how 
this was done.
    And with that, Madam Chair, I yield back.
    The Chair. Thank you, Ranking Member Thompson.
    Under Secretary Bonnie, if you would like to respond to 
that, we will give you some time before we turn to our next 
Member.
    Mr. Bonnie. Yes. This is a commodity program. It is 
specifically linked to commodity production, and that is 
important. And while it does sit in NRCS, we will draw on 
expertise from across the Department, the Office of the Chief 
Economist, FSA, and others as we move forward on this, and 
welcome a conversation with everybody. We have tried to listen 
to agriculture as much as we can. We welcome the conversation, 
going forward.
    Mr. Thompson. Well, Mr. Under Secretary, and I expressed 
this to the Secretary, too, and I hope you will take this in a 
sincere way. I also am hoping that what you have announced 
doesn't undermine the fact that the state of American 
agriculture today with our productivity, our application of 
technology, innovation, and science, they are already climate 
heroes. I am afraid that perhaps that was the other thing that 
was miscommunicated that only the folks, that it is in the 
future that agriculture will be the climate heroes, when quite 
frankly, they are the leading force for good. American 
agriculture is really a force for good around the world in 
terms of a healthier environment and climate.
    So, thank you so much.
    The Chair. All right. I now recognize the gentleman from 
California, Mr. Carbajal, for 5 minutes.
    Mr. Carbajal. Thank you, Madam Chair.
    Santa Barbara and San Luis Obispo Counties in my district 
are home to a wide array of specialty crop production, from 
wine grapes to strawberries, broccoli, and other fresh fruits 
and vegetables. An increasing number of producers in my region 
are participating in the crop insurance program, but I still 
hear from many of them who find it challenging to take 
advantage of the existing programs for a variety of reasons.
    Under Secretary Bonnie, can you please discuss the crop 
insurance products that are available for specialty crop 
producers, and share an overview of any newer products that 
recently have become available for producers like those in my 
district?
    Mr. Bonnie. So, probably I think as we think about crop 
insurance, we are always in a dialogue with agriculture, sort 
of turning the knobs, to make them work better for agriculture. 
We are developing specific products for specialty crops. For 
example, apples right now, we are in conversations with folks 
in the apple industry about developing a product that will work 
for them. We have developed Whole Farm and lots of other 
efforts that work for specialty crops.
    But we recognize the need to continue to listen to take 
account of where users are. I mentioned earlier, this is a 
partnership between the agent and the agency. It is also a 
partnership with agriculture, and so, we welcome your input and 
producers' input to make sure that we are offering the products 
that agriculture needs.
    Mr. Carbajal. Thank you.
    My district on the Central Coast of California has been 
severely impacted by year-round wildfires as a result of 
climate change. This new reality has a significant impact on my 
local producers through direct crop losses, smoke taint of wine 
grapes, and the inability for workers to safely harvest crops 
due to poor air quality conditions.
    To help address those losses in communities such as mine, 
this Committee passed legislation to respond to agricultural 
losses due to natural disasters in 2020 and 2021, last summer. 
Congress provided $10 billion in funding for that purpose later 
in the year. When do you anticipate details regarding the 
distribution of that assistance will be announced?
    Mr. Bonnie. We are trying to move as quickly as we can. Our 
expectation is we will have more detail for you this spring. As 
I noted, we are moving with livestock in March. We are going to 
try to make this as easy as possible for producers. We are 
going to try to use existing data, crop insurance, NAP, and 
other programs so that producers don't have to come back in. We 
will then have a second round where we have gaps that we can 
work with producers to fill those gaps. Our plan is to move 
here as quickly as we can.
    Mr. Carbajal. Great.
    To that end, can you also touch on what lessons were 
learned from the 2018/2019 WHIP+ implementation that you have 
used to help guide the distribution of disaster assistance for 
the 2020/2021 losses?
    Mr. Bonnie. Yes. I think WHIP worked well. I think part of 
our effort here to streamline this is lessons learned. How do 
we make this as easy as we can for producers? So, that was part 
of the lesson learned here, and then as I say, we will have two 
phases both on the livestock and the crop side with the hope 
that we can answer any significant gaps in the second phase.
    Mr. Carbajal. Thank you, Under Secretary Bonnie. I really 
appreciate your leadership and your good work.
    With that, Madam Chair, I yield back.
    The Chair. Thank you, Mr. Carbajal.
    I now recognize the gentleman from Georgia, Mr. Allen, for 
5 minutes.
    Mr. Allen. Thank you, Madam Chair, and thank you, Mr. 
Bonnie, for joining us today.
    Obviously, we had a great hearing last week from NRCS Chief 
Cosby and FSA Administrator Ducheneaux, as we conduct a review 
of the farm bill conservation programs. We are obviously very 
focused, or at least, this Administration is totally focused on 
climate change, and this is at odds from what I am hearing at 
home. I don't hear about climate change. All I am hearing from 
my constituents is this Administration's war on fossil fuel, 
which is causing input costs to rise at unprecedented levels, 
meaning fuel, fertilizer, and so on. They tell me about the 
constant dumping of foreign commodities such as blueberries in 
our domestic markets. And overwhelmingly, I hear about supply 
chain disruptions made worse by the Administration's vaccine 
mandates, school closures leaving parents unable to go to work, 
decreased meat packing line speeds, and countless other agency-
level decisions made by unelected officials. They walk in the 
grocery store, they see empty shelves and the price of food is 
unprecedented.
    Mr. Secretary, obviously this Administration took office a 
little more than a year ago. You talked about being outcome-
based, can you tell me how many dollars has USDA, as far as 
your responsibility, has redirected toward climate change in 
rural America?
    Mr. Bonnie. So, first, I am not sure I can give you an 
exact number, and I will tell you why.
    A lot of the climate practices, climate-smart practices 
that we think about are actually things like timber stand 
improvement, nutrient management, cover crops, soil health. 
They are things that have broad other environmental and 
conservation gains. Things that improve productivity of 
agriculture are good for climate, because we can grow more, 
more efficiently. That is really good for climate.
    Our hope here is to prioritize climate practices where we 
can, but to do it in a way that works for agriculture that 
creates new opportunities. So, we will continue to look for 
ways in the conservation programs to do that, and of course, 
with the partnership initiative that we talked about yesterday.
    Mr. Allen. So, let me get this straight. These are 
practices that we have always done, and obviously, rural 
America is one of the great climate change advocates, and have 
been, because that is how they make their living. So, why all 
this emphasis, and again, I don't know where we are moving 
money or whether we are taking our eye off the ball here, but 
we have other problems we got to deal with, and I want to know 
why are we taking our eye off the ball on feeding America in 
the most efficient and the safest ways, and all of this noise 
about climate change? Like I said, my people are not talking 
about climate change. They are very concerned, so what are we 
doing to address these issues?
    Mr. Bonnie. When I go out in the countryside, I hear about 
drought, I hear about wildfire, I hear about extreme weather 
events. And part of our effort to address those things is about 
climate change as well, and it is making U.S. agriculture more 
resilient. And investments in that is, as I noted, is going to 
actually----
    Mr. Allen. Sir, you already talked about everything we are 
doing to deal with climate change.
    Let me ask you this. With everything we are doing with 
climate change, how much are we going to lower the temperature 
of this planet?
    Mr. Bonnie. Well, I don't think----
    Mr. Allen. You are outcome-based. Tell me how much we are 
going to actually reduce the temperature of the planet and all 
of a sudden the weather is totally calm?
    Mr. Bonnie. Well, I am not a climate----
    Mr. Allen. And no more droughts.
    Mr. Bonnie. I am not a climate modeler, but I know that 
U.S. agriculture is prepared to do a lot of good and to create 
new markets and new opportunities while they do it.
    Mr. Allen. Well, again, I think we better keep our eye on 
the ball. We need to address these issues because like I said, 
for our farmers, this input cost is a real problem, and with 
that, Madam Chair, I yield back.
    The Chair. I now recognize the gentleman from Georgia, Mr. 
Bishop, for 5 minutes.
    Mr. Bishop. Thank you, Madam Chair, and thank you, Mr. 
Bonnie for sharing with us today.
    Let me first associate myself with the comments from 
Congressman Austin Scott, as well as yours regarding the 
attacks on farm families as evidenced through The New York 
Times piece. It obviously reflects a lack of understanding of 
the great difficulty that our farm families have providing the 
food and fiber for all of Americans which they are doing so 
well under difficult circumstances. So, we have a real job in 
educating the public as well as some of our Members of 
Congress. But I want to associate myself with those remarks, 
because our farm families deserve better.
    Let me address you, Mr. Bonnie. Prior to the global 
pandemic--and I am speaking as an appropriator--USDA staff 
retirements and attrition had reached an all-time high, leaving 
the Department with fewer staff and less experienced staff all 
across the 29 agencies. This seems to be pronounced at the 
local level in the FSA county offices. In my district, there 
have been anecdotal reports of timeliness issues when 
responding to customer service requests from county to county. 
With the increased workload from several ad hoc programs like 
payments to offset the 2018 trade war, ad hoc disaster 
assistance, the pandemic relief, has staffing been a concern 
within the Farm Production and Conservation mission area? Given 
the crucial assistance that FSA provides, do you have any 
suggestions for us as to what additional authorities or what 
additional resources the Department needs to address these 
challenges, particularly in our rural counties, that we should 
consider in the next farm bill? How do you anticipate that the 
Fiscal Year 2023 budget requests will address staffing needs, 
and are there staffing needs that go beyond the current 
Administration's priorities? Basically, do you have enough 
people to do the core work?
    Mr. Bonnie. We need more people, and we need both on the 
NRCS side and FSA. And you are right about staff attrition, and 
we are looking at things like direct hiring authority to be 
able to streamline that process. And it is critically important 
as you all think about the 2023 Farm Bill, thinking about 
things like technical assistance for NRCS, the ability for us 
to have the boots on the ground to provide sound technical 
assistance, to do the outreach we need to small producers, 
medium-sized producers, historically underserved, another 
important issue here. So, yes, there is a challenge and we are 
moving to hire as quickly as we can.
    Mr. Bishop. Thank you.
    Now, over the years, Mr. Bonnie, farmers of color have 
experienced historic discrimination in the loan process from 
the county offices, and in my district, there have been some 
anecdotal reports of the lack of consistency in services 
provided from county to county. For example, I had a farmer 
that was told that he needed to have irrigated crops in order 
to participate in the non-insured crop disaster assistance, 
which is simply not true.
    I know it is difficult to standardize processes across 
geographic regions and not everything can be uniform, but 
timeliness, the level of customer service, honesty, and the 
appeals process are examples of standards that should be 
consistently applied from county to county. What additional 
efforts is USDA making to ensure that the same quality of 
service occurs from county to county, and that equity and other 
challenges in rural counties can be accommodated, and is there 
something that we need to include in the next farm bill in that 
regard?
    Mr. Bonnie. This is a critically important issue that USDA 
programs are available to everybody. On the loan side, we think 
there is more we can do in loan servicing, but we have to make 
sure our staff is able to do that, and we will continue to work 
to do that.
    On our programs more generally, making sure we have 
outreach partnerships, both in FSA, RMA, we just moved $50 
million in NRCS to create some partnerships with folks on the 
ground to make sure we can reach everybody. This is critically 
important. It was critically important in our announcement 
yesterday when we talked about the importance of being able to 
reach all farmers. So, this remains a very high priority for 
us.
    Mr. Bishop. I think my time has expired. I yield back, 
Madam Chair.
    The Chair. Thank you, Mr. Bishop.
    I now recognize the gentleman from Arkansas, Mr. Crawford, 
for 5 minutes.
    Mr. Crawford. Thank you. I appreciate it.
    Mr. Bonnie, the 2018 Farm Bill bipartisanship, which is why 
I'm troubled by this example of USDA ignoring not just 
Congressional intent [inaudible] beginning farmers who are 
frustrated, being outbid by the Federal Government in their 
effort to access land to get into farming.
    Last month, USDA again announced it is offering a ten 
percent inflationary adjustment that is likely to exceed the 
cap set in law. So, my question is what legal authority did 
USDA use to go beyond the caps Congress expressly set in the 
law, and will USDA assess the impact that its decision has on 
beginning farmers and purchase affordability in farm country?
    Mr. Bonnie. Well, CRP is obviously a very important 
program. We talked about that. We have talked about how 
important it is for hunting and fishing and conservation more 
broadly. We work closely with OGC as we developed the new 
incentives last year that we worked on, and are very confident 
that we are on solid ground there.
    I think one of the most important issues is to make sure we 
get the best acres into CRP, marginal acres, flood prone acres, 
and I think if we do that, we can find a balance with 
agriculture where the folks that are concerned about taking 
land out of production, that we can strike the right balance.
    Mr. Crawford. Well, Madam Chair, I think we should take a 
hard look at this issue as we craft the next farm bill. It is 
troubling to me that Congress can set a clear cap with clear 
intent only to see its bipartisan work ignored.
    Let me follow up with consumer-packaged goods. Companies 
are always looking to set their products apart in the grocery 
store and restaurants, and now looking to incentivize 
production of low carbon grains to show environmental 
distinction about final products. It is my understanding that 
growers that sell in these markets can see a premium price. 
Isn't that an example of the private-sector being a leader, and 
what we see from this Administration is the government trying 
to play catch up?
    Mr. Bonnie. There is no doubt that there are already folks 
in the market. There are emerging markets for both. If you look 
what cotton producers are doing, if you look at what some other 
companies are doing in this space, there is no doubt that these 
markets are emerging.
    The question is can we do more to scale more quickly, and 
can we de-risk this for producers by providing incentives, both 
on the deployment of climate-smart practices, as well as the 
measurement and monitoring? We think that is a good place for 
us to be.
    Mr. Crawford. Thank you, Madam Chair. I yield back.
    The Chair. All right, thank you very much.
    I now recognize Mr. O'Halleran from the State of Arizona 
for 5 minutes.
    Mr. O'Halleran. Thank you, Madam Chair, and Under Secretary 
Bonnie, I appreciate your testimony. Thank you for spending 
your time with our Committee this morning.
    In your testimony, you certainly are explaining new and 
innovative ways that USDA is working with farmers to ensure 
that they can access critical programs that this Committee 
worked on in the 2018 Farm Bill. Programs administered through 
the Farm Service Agency and the Risk Management Agency have 
become of particular importance to Arizona over the past few 
years. The entire Southwest is experiencing significant 
drought, which has worsened wildfires. When people need to 
access these farm programs that we are discussing today, it is 
because they are struggling. And when farmers struggle, rural 
economies suffer. This is why it is important to be sure that 
in this coming farm bill process, we get these programs right 
and we are able to provide strong programs to support our 
farmers.
    Mr. Bonnie, as you highlighted, USDA has done quite a bit 
to expand the availability of different specialty crop 
insurance products for its stakeholders. However, I am very 
concerned regarding the infrastructure of USDA, and whether 
Congress has devoted enough resources to make the experience 
better for stakeholders when accessing USDA programs. When 
people need to rely on crop insurance programs, it is often 
because something has gone wrong. In Arizona, many of my 
constituents rely on these USDA programs in response to 
dangerous wildfires. Can you talk about how you are evaluating 
staffing needs? I know we talked about this already. I want to 
know what is going to be done, are you going to request more 
money? What are you going to do about IT infrastructure and 
other internal processes to make the experience better for the 
farmer utilizing one of the programs administered through the 
Farm Service Agency or the Risk Management Agency? And are you 
going to actually ask Congress for it and get it through the 
Secretary and the Administration to get it down to the people 
that we all serve?
    Mr. Bonnie. As I noted earlier, you are exactly right. 
Staffing is a critically important issue, and we will use our 
authorities to the maximum extent practical to help on that.
    I am glad you brought IT up, because that is an important 
part of the equation as well. We have to be able to allow for 
folks to access things like farm loans online to make it easy, 
and so, looking for ways that we can use IT to both reduce 
staff burden, but to open up programs to more people I think is 
really, really important.
    You can imagine, I probably don't want to scoop OMB or the 
Secretary on budget issues, but just know that the staffing 
issues are really, really important. We need the boots on the 
ground, whether it is safety net or conservation programs, to 
be able to deliver these programs to producers.
    Mr. O'Halleran. The staffing issues are not new. They have 
been there for quite some time, and it is not new to this 
Administration or the previous Administration. It appears like 
something has to be done, and it has to be done so that we keep 
the family farms up and going, and make sure farming in America 
continues in the direction it needs to.
    Thank you for giving us the overview of the workload of the 
Farm Service Agency, but in the past few years, given several 
ad hoc programs along with the regular farm bill programs they 
delivered, and what sort of workload do you anticipate delivery 
of disaster assistance for 2020 and 2021 will place on county 
FSA offices, and how has the pandemic impacted that workload?
    Mr. Bonnie. I should take this opportunity just to thank 
the folks in FSA. We have asked them to do a lot. We have put a 
lot of work, the pandemic assistance, our regular programs, 
disaster, and they have delivered. As we were thinking about 
the experience with WHIP and with other programs and the 
disaster program that we are rolling out this spring, staff 
capacity is really important. We want to be accountable. We 
want to make sure we spend the taxpayers' money well, but at 
the same time, we want to both reduce the burden on producers 
as well as FSA staff.
    Our hope is that once we get on the other side of disaster 
and pandemic assistance, things will calm a little bit, but 
even despite us asking more of those staff, and in a pandemic 
where staffing levels are down, our FSA team has delivered 
beyond expectations.
    Mr. O'Halleran. Thank you, Under Secretary.
    I just want to mention quickly that you can have the best 
product in the world, the best program in the world. If we 
can't get it to the people, it is not going to work. So, let's 
get it to the people that need it.
    Thank you, Madam Chair, and I yield back.
    The Chair. Thank you, Mr. O'Halleran.
    I now recognize the gentleman from Florida, Mr. Lawson, for 
5 minutes.
    Mr. Lawson. Thank you, Madam Chair, and Mr. Bonnie, welcome 
to the Committee.
    During the winter months Florida is responsible for about 
half of the produce consumed by America. Over the last couple 
of weeks, produce in my state has been experiencing extreme 
winter weather conditions with temperatures dropping below 
freezing in some areas. My question is can you give us an 
overview of what you have been gathering from farmers impacted 
in the Southeast by the weather, and what resources are 
currently available to help producers who have been 
experiencing this impact?
    Mr. Bonnie. Yes. We have obviously heard from producers as 
well, and you know, we have traditional programs there, crop 
insurance and other programs. The disaster program that you all 
provided resources for is tied to 2020 and 2021, so we can't 
access those for efforts in Florida. So, we will rely on our 
traditional disaster programs and crop insurance to help your 
producers.
    Mr. Lawson. Okay, thank you.
    Mr. Secretary, after Hurricane Michael made landfall in the 
panhandle where I am in 2018, over 16,000 forestland owners 
reported damage to their timber, with more than $1.3 billion in 
losses. What are the lessons learned from the 2018/2019 
Wildfire Hurricane Indemnity Program that you have used to help 
guide the implementation of disaster assistance for 2020 and 
2021 losses, especially as it related to state block grants 
like the one used for timber losses?
    Mr. Bonnie. Yes, I think we saw significant timber losses, 
and of course, when timber is down on the ground, it tends to 
increase supply very quickly and prices drop, which only makes 
salvaging the timber more difficult. And so, there were 
resources provided in WHIP for that. Again, this is an area of 
concern. We are limited in the number of tools we have there. 
We tend to have more tools on the agriculture and livestock 
side, but clearly, it is a significant challenge and one that 
deserves some discussion going into the 2023 Farm Bill.
    Mr. Lawson. Real quick before my time ends. Mr. Secretary, 
are we importing more timber into this country?
    Mr. Bonnie. We do import timber, but you and Mr. Scott, you 
both know your part of the world produces a lot of timber, and 
exports a lot of timber. The U.S. is a significant carbon sink, 
and part of it is because people have invested in timber, 
forestland ownership, and in places like Florida and Georgia in 
the South and other parts of the country.
    Mr. Lawson. Okay. With that, Madam Chair, I yield back.
    The Chair. All right. Thank you very much, Mr. Lawson.
    I now recognize the gentleman from South Dakota, Mr. 
Johnson, for 5 minutes.
    Mr. Johnson. Thank you, Madam Chair. I appreciate that.
    Mr. Under Secretary, I think the crop insurance system we 
got has done a really good job from a customer service 
perspective, as well as making sure those indemnities get out 
in the field as quickly as possible. I know some have proposed 
eliminating the private-sector-based delivery system. Any 
observations on that?
    Mr. Bonnie. I think the public-private partnership is a 
great delivery mechanism. As you point out, we can move 
quickly. You can turn on assistance very quickly, and that is 
very attractive.
    Mr. Johnson. Yes, I would just, first, I agree with you; 
and second, I would just urge you, as I am sure you would even 
if I didn't say anything, push back on any of those proposals, 
because I think you said it right. The public-private 
partnership has delivered a tremendous amount of value.
    Now I want to look towards some of these--and I will admit 
up front, South Dakota by and large has been early adopting as 
a state with regard to things like no-till. Granted, it is 
still a checkerboard, right? I mean, different producers can 
make different decisions, and even within their own property 
they may make a different decision on one section versus 
another section. But as we look toward smart stewardship 
practices of the future, how do we balance being fair to early 
adopters while also trying to target scarce resources toward 
getting a change in behavior? Give us some sense of how you do 
that, going forward?
    Mr. Bonnie. This is a critically important issue, the issue 
of early adopters as we think about particularly with respect 
to climate change. If all you did was tie the benefits from 
adopting climate-smart practices to carbon, some of those folks 
that have been doing these things for a long, long time might 
not be able to increase their carbon stores by that much. And 
so, looking for ways to incentivize practices, looking for 
ways, part of the thought yesterday with climate-smart 
commodities is that by linking it to commodities that we can 
maintain and enhance incentives for those early adopters. This 
is a critically important issue. You don't want to create 
perverse incentives for folks to come out of conservation 
tillage or come out of other things they do so they can get 
back into these programs. This issue is vitally important as we 
think about whatever it is, wildlife, whatever it is, climate. 
We have to have a response that both recognizes the 
contribution that many in agriculture have already made and 
rewards them for it.
    Mr. Johnson. Do we have a sense of operationally what is 
the best way to do that? I mean, obviously you could do it by 
having a further look back in setting your baseline. There are 
other mechanisms. Do you have a favorite?
    Mr. Bonnie. Yes. You are exactly right, and there are folks 
out there on the ground that are thinking about a look back, 
could we look back 5 years, 10 years. Obviously it requires 
some modeling or some other work to do that.
    You can also think about if you are producing a climate-
smart wheat or you are producing a climate-smart soybean, where 
the benefit is tied to the practices and the work being done to 
make sure that those commodities are produced in a climate-
smart way. We can design incentives there that actually 
maintain the reward system for those early adopters.
    Mr. Johnson. Then one last question, sir. I mean, as this 
Committee continues its movement toward the next farm bill, 
what would you most want us to keep our eye on? What is the 
area most ripe for improvement?
    Mr. Bonnie. Well, with this pilot program that we rolled 
out yesterday, we hope that there will actually be some 
learning that will create some conversation, both on the 
incentives side of the equation as well as on the measurement 
and monitoring verification. It is going to be important for us 
to prove up these practices, to demonstrate that agriculture 
has an important role to play, both so that we maintain public 
confidence in making investments in conservation and other 
things for producers, but also so that the private market will 
continue to have confidence to invest in agriculture and invest 
in forestry.
    So, one of the things we need to think about is how do we 
invest in inventory and other things that will provide the 
tools, the models, the help that producers need to be able to 
make those decisions. So, we often think about the incentives 
side. There is an infrastructure of research and inventory that 
backs that up that is really important.
    Mr. Johnson. Thank you very much, sir, and thank you, Madam 
Chair. I yield back.
    The Chair. Thank you, Mr. Johnson.
    I now recognize the gentlewoman from Washington, Ms. 
Schrier.
    Ms. Schrier. Thank you, Madam Chair, and welcome, Under 
Secretary Bonnie.
    I would like to touch on a few issues really quickly, and I 
am enjoying this conversation. First, my colleague, Chellie 
Pingree, and I are co-leading an Agriculture Task Force as part 
of the House's Sustainable Energy and Environment Coalition, 
and with this taskforce, we want to build on increasing 
engagement of American farmers on climate change issues in a 
lead up to the reauthorization of the farm bill. We just held 
our first meeting identifying some shared priorities and the 
direction that we would like to go. But one thing we decided 
would be really helpful was to meet with experts in the field 
so that we make sure that we are really getting the most bang 
for the buck.
    So, I want to invite you. We would love to have you join 
our conversation, to come meet with our group, and give us some 
direction on how we can recognize, celebrate, amplify the 
contributions of our farmers who engage in climate friendly 
practices, and get your take on what will have the most impact 
on either reducing or sequestering greenhouse gases.
    Mr. Bonnie. Of course, I am happy to join.
    Ms. Schrier. Thank you. We are very excited to have you.
    Next, I want to just ask you, Mr. Under Secretary, about 
the Sustainable Farms and Fields Program in Washington State, 
which does exactly what you were just talking with Dusty 
Johnson about. It rewards the practices, not just the carbon. 
It is bipartisan. It is voluntary, supports farmers and 
innovation, simply rewards the practices, and it gives 
different options for participation so the funds can be used 
for site specific consultations, or the purchase of goods that 
they might need like seed drills, and even direct payments, in 
some cases, for carbon storage. So, this program is 
particularly well-suited for small- and medium-sized farms, as 
well as first-time, low-income minority farmers because you 
don't have to enter a carbon market to be compensated for doing 
the right practices.
    And so, I first just want to thank you for taking the time 
to meet with Michael Crowder from the National Association of 
Conservation Districts, and Kirk Robinson from the Washington 
State Conservation Commission. We are very, very grateful and 
just ask for your continued engagement and support. And I was 
wondering if you could just quickly comment on how this 
particular Washington program fits into yesterday's 
announcement that the USDA is investing $1 billion in 
partnerships to support America's climate-smart farmers, 
ranchers, and forestland owners?
    Mr. Bonnie. Part of our, as I mentioned earlier, part of 
the recognition yesterday is that there is a lot of really good 
work already going on. Still, there are risks for producers 
that when they undertake some of these practices, and certainly 
when they lay money out to measure, monitor, and on the back 
side. And that is why we think there is an interesting role for 
USDA. We fully expect that folks are going to have projects 
already in development or underway where they may be able to 
partner with USDA to scale out those projects, and we will look 
for those opportunities. And whether they are interested in a 
climate-smart commodity or a greenhouse gas reduction or 
whatever it is, we think we can structure this in a way that 
works.
    So, part of the idea here is to tap into many of those 
existing things, and to allow whether it is a state, a company, 
a nonprofit, a conservation district, a commodity group, all 
those folks to come forward to build those partnerships and 
develop those locally-led programs.
    So, part of it is to allow 1,000 flowers bloom and to draw 
on that experience, and to learn from it. So, we expect 
Washington and other folks to take a close look at this and 
hopefully we will generate a lot of interest.
    Ms. Schrier. That is great, 1,000 flowers all different, 
and then roll out what we have learned nationally.
    Last, I have very little time, but I just wanted to touch 
on a piece of legislation I am working on to modernize the 
Sustainable Agriculture Research and Education, or the SARE 
Program. This program has funded nearly 200 projects in 
Washington State, focusing on a broad range of topics like 
cover crops and tree fruit pests and sustainable grazing 
practices, and producers and stakeholders in my district 
absolutely love this program because it funds research that 
suits their specific needs. It is farmer-led and farmer-driven, 
and we just need to update this program to ensure it is working 
as effectively as possible to meet the needs of agriculture in 
the 21st century. So, I look forward to working with you and 
your staff on this, and I yield back.
    The Chair. Thank you, Ms. Schrier.
    I now recognize the gentleman from Kansas, Mr. Mann, for 5 
minutes.
    Mr. Mann. Chair Bustos, thank you for having this hearing 
and Under Secretary Bonnie, thank you for joining us today.
    As we all know, it is important that we get farm programs 
right in advance of the next farm bill. During your 
confirmation hearing last summer, several Senators asked you 
about the Conservation Reserve Program, the CRP Program. You 
often answered that it is vitally important that we get the 
right lands in the program. We don't want to take highly 
productive lands out of the program, or we don't want to put 
highly productive lands into the program, and I agree with that 
focus. According to USDA's most recent natural resources 
inventory, at least 1 out of every 4 acres of land in CRP is 
considered to be prime farmland. In your mind, why is so much 
good productive farmland ending up in CRP, and what is USDA 
doing to achieve the shared goal of reserving CRP for the most 
environmentally sensitive acres that need to be in the program?
    Mr. Bonnie. So, the concern you would have if you have 
really productive land coming in is that you are taking out 
highly productive land that is obviously an economic 
consideration as well, and that this program was designed for 
more marginal lands, obviously. It is a voluntary program. 
Landowners are going to enroll what they are going to enroll, 
but we can do things through targeted enrollments, continuous 
enrollments, partnerships through CREP, that can make sure we 
get those lands that are really environmentally sensitive. 
Maybe they are environmentally sensitive because they are in a 
riparian area, or maybe there are efforts to deal with water 
issues, like the Republican River in Colorado, or there are 
targeted uses here. And I think that is really important.
    There, of course, are lands that may be drought sensitive 
or otherwise that will come in through the general signup. 
Those remain really, really important, but there are ways that 
we can both incentivize and think about continuous enrollments 
and others to make sure that we get the right mix of lands into 
the program.
    Mr. Mann. Thank you. I think the issue needs to be 
addressed before any discussions about raising CRP's acreage 
cap really come to bear. We are going to have limited 
resources, as we all know, in the next farm bill, and limited 
land on which we are farming. And this Committee, we need to 
prioritize the working lands programs and make sure that the 
right acres are going into the CRP Program. So, thank you.
    Second question: As farmers are gearing up for the 2022 
growing season, many are having difficulty getting fertilizer. 
We know that many times fertilizer costs three or four times or 
more than it did last year. We are also having challenges 
getting key chemicals that may not even be available for crop 
protection due to regulatory and supply chain issues. If these 
challenges ultimately result in lower yields, in your mind, 
what risk is there to the crop insurance industry, and in 
particular, to the private-sector delivery system that is 
currently in place as these claims come forward?
    Mr. Bonnie. I mean, I guess it is hard for me to estimate 
what the risk is. There obviously is one there and we are 
sensitive to the fact that folks are looking at higher inputs 
costs.
    As I noted before, the set of tools we have is relatively 
limited. We are thinking about: are there ways that we can help 
on the supply chain side. With the work we have done so far, it 
has sort of been on thinking about export, the partnership in 
the Port of Oakland, but we are open to looking at ways that we 
can address this. Our challenge is that our toolbox is 
relatively limited.
    Mr. Mann. Yes, great.
    One more quick question. I know I have just a little over a 
minute, but my family farm is in Gove County, in northwestern 
Kansas. And the FSA office, the workers there constantly are 
talking to my dad and I hear this repeatedly from other 
offices, just the antiquated computer systems, the 
inefficiencies, the amount of time it takes to log in and log 
off. What is being done there, and what do you think needs to 
be done here moving forward? And forgive me if you covered this 
earlier in the hearing.
    Mr. Bonnie. No. IT across FSA and across FPAC is a really, 
really important issue, and we have just adopted an updated 
strategic plan, but frankly, there is more to do there. And it 
involves both the public facing side--I mentioned farm loans 
earlier, but making enrollment easier, updating that to make 
sure we have better tools than we have now, and as you point 
out, kind of the office side of it was to make sure our folks 
have the best technology.
    We have work to do. This is going to be an important area 
of investment. We have to think about how we balance the 
workforce we have, how we build the workforce. There is work to 
do there, and I think we will do it in consultation with 
Congress.
    Mr. Mann. Great. Thank you, Mr. Under Secretary, and Chair 
Bustos, I yield back.
    The Chair. All right, thank you, Mr. Mann.
    I now recognize the gentlewoman from Maine, Ms. Pingree, 
for 5 minutes.
    Ms. Pingree. Thank you very much, Madam Chair. Thank you 
for holding this hearing, and Under Secretary Bonnie, thank you 
for being with us here today. We appreciate your time.
    I, for one, was very excited to see Secretary Vilsack 
announce more details about the Partnerships for Climate-Smart 
Commodities Initiatives yesterday, so consider me a strong 
supporter, and I think it is a great idea. And I know some of 
my colleagues have been expressing some skepticism about 
spending $1 billion from the CCC to help farmers mitigate 
climate change, but I think we should all remember that last 
September, Congress had to pass $10 billion just in ad hoc 
disaster relief for agriculture, and that is on top of the 
support we already provide through the farm bill. So, while 
some of my colleagues say well, we don't hear about climate 
change from farmers--and it is often true. They don't mention 
climate change directly, but they certainly talk about the 
economic impact of the adverse weather effects and other things 
that are directly related to climate change. So, I would prefer 
to invest in helping farmers reduce their emissions and 
sequester more carbon in the soil, increase their resilience to 
extreme weather events, than have to pay it out in disaster or 
to see the damage and heartbreak that happens on so many farms 
across the country because of the experiences that we are 
having that are likely to only get worse.
    So, let me ask a question about the new initiative. One the 
goals of the Partnerships for Climate-Smart Commodities is to 
test different monitoring and verification methodologies so 
that USDA is not dictating how the recipients of this funding 
should go about doing that. Monitoring and verification is 
really important for us to know what the real impact of these 
projects will be, and that is something that I hear about all 
the time. So, could you just tell us a little bit more about 
how USDA will ensure that the monitoring and verification 
methods these projects will use are both farmer-friendly and 
scientifically-sound?
    Mr. Bonnie. Yes. So, we are going to ask every project that 
comes in to have a monitoring verification program as part of 
the project, and we will look at those and score projects based 
on that.
    The last point you made is a really important one. As I 
noted earlier, we want to maintain public confidence. We want 
to demonstrate that agriculture and forestry have an important 
role to play, and that these voluntary efforts work and will 
reduce greenhouse gases. And that is public facing. The market 
is going to take that into account as well, and make 
investments accordingly. At USDA, we need to, in parallel to 
the efforts going on with the announcement yesterday, we need 
to invest in more resources here to have a better understanding 
of where are producers doing conservation tillage? What 
practices are they doing? How do we measure nitrous oxide 
emissions reductions, methane, and all those things? It is 
critically important. We hope we will learn some things from 
the pilots, and we hope we will get some new technologies in. 
And as you know, there are a lot out there that could 
potentially lower the cost and increase the accuracy of those 
measurements. It is a critically important issue.
    Ms. Pingree. Thank you for that. I will really look forward 
to following that with you, because as you said, it is 
critically important. We need to make sure that if commodities 
are identified in this way, that the public has trust in that. 
And actually, I thought Representative Johnson of South Dakota 
made a really good point that I hear often is what about the 
early adopters? The organic farmers who have been worrying 
about soil and carbon in their soil for a very long time? They 
say to me am I going to be left behind, because I am not a 
newcomer?
    So, let me just quickly switch to another topic with the 
time I have available. That is about the Dairy Indemnity 
Program, and the recent updated rules. So, they provide 
additional options for dairy farms dealing with PFAS 
contamination, which unfortunately is a growing issue in my 
state, and I know we are going to hear about it everywhere.
    But I do hear some concerns that the new structure of the 
program may not provide producers with enough time to gather 
the information they need to make a decision about the best 
path forward on their farm. While Farm Service Agency can 
extend monthly milk indemnity payments on a case-by-case basis, 
3 months isn't really a lot of time to get soil and water 
testing done, for example. So, I am just going to ask you if 
you could commit that the FSA will work with producers affected 
by PFAS contamination so that these farmers have enough time to 
figure out their options and make an informed decision, which 
as we know, is sometimes the question of can you mitigate, or 
do you have to abandon? So, just quickly.
    Mr. Bonnie. Yes, I am absolutely happy to work with you.
    Ms. Pingree. Great. Well, thank you for moving forward on 
that, and again, I think that is a growing problem, really 
critical in my state, and I am looking forward to working with 
you.
    So, with that, I will yield back my 12 seconds and thank 
you so much for being with us today.
    The Chair. Thank you, Ms. Pingree.
    I now recognize the gentleman from California, Mr. LaMalfa, 
for 5 minutes.
    Mr. LaMalfa. Thank you, Madam Chair. Thank you, Under 
Secretary, for being here.
    As a farmer, our family has been farming where we are for 
90 years, and of course, I have a lot of neighbors and other 
colleagues. Agriculture is an extremely important part of the 
fiber of this country, obviously, and so, when we see our 
shelves are empty, our food commodity prices are higher and 
higher for public, yet the farmers are receiving less and less, 
now we get a curveball of saying hey, you need to do things 
climate-smart. So, can we figure out how is it you grow 
something climate-smart versus not smart at the field level? 
Because, growers are already looking for the most efficient 
ways to grow crops using all the technology with water savings 
and the least amount of chemicals, leveling land and all that. 
And so, how is this not going to throw another curveball at 
people in agriculture, having to deal with yet another thing in 
addition to being out of water in California, losing the 
materials we have to control pests with, higher cost of fuel, 
fertilizer is going to double. How is a farmer supposed to look 
and say great, here is another program for us to jump through 
because somebody wants to worry about carbon? Under Secretary, 
how is a farmer going to look at this?
    Mr. Bonnie. This is voluntary, and farmers can decide for 
themselves whether it fits into their own production, and 
whether it provides value. Our interest here is actually 
providing value, creating new markets, new opportunities, new 
sources of income, and to de-risk it in a way that allows 
producers to step into that.
    It won't work for everybody, but we think it will work for 
a potentially large slice of agriculture.
    Mr. LaMalfa. Sir, how is shifting $1 billion away from CCC, 
which is supposed to be helping promote domestic farm and price 
supports, and keeping farmers alive in disaster after disaster 
or low prices, what have you, $1 billion being shifted away 
from CCC into something that might be more looked at as a new 
program? I mean, that at the same time, the EQIP Program, which 
is a great program that farmers voluntarily use in order, the 
Environmental Quality Incentive Program. It does a lot of good 
work on that. We have participated and all my neighbors 
participate in it, many across the country. So, that improves 
conservation in an existing program, yet EQIP has only been 
funded by about 27 percent of people that applied and asked to 
be part of that. So, now $1 billion is being shifted away from 
things that are already promoting the commodities or the 
conservation programs. How is a $1 billion program even being 
defined as a pilot program? That is a lot of money.
    Mr. Bonnie. This is $1 billion that will go to folks in 
agriculture, both to deploy climate-smart practices as well as 
measure----
    Mr. LaMalfa. Let me give you the list here, because it is 
not even eligible for individuals. If you are a city or county 
or local government, you can get it. A state government can get 
it, for-profit organizations can get it, nonprofit 
organizations get it, 501(c)(3) or not 501(c)(3), private 
institutions of higher education, meaning colleges which 
already receive lots of other different types of money, and 
public and state-controlled institutions of higher education as 
it is listed too. So, everybody but an individual is going to 
see this money.
    Mr. Bonnie. No, the way it is designed is to have those 
institutions, whether a commodity organization or otherwise, 
aggregate those individuals. That will lower the cost for them 
and make it easier for them to participate, and easier for them 
to earn additional resources through this.
    Mr. LaMalfa. What makes a commodity climate-smart versus 
not climate-smart?
    Mr. Bonnie. So, there are a number of practices. In this 
case, what we are interested in is reduced greenhouse gas 
emissions or carbon sequestration. There are a lot----
    Mr. LaMalfa. Is carbon dioxide considered a greenhouse gas?
    Mr. Bonnie. Carbon dioxide is, yes.
    Mr. LaMalfa. Okay, versus methane coming out of other 
byproducts?
    Mr. Bonnie. Another greenhouse gas.
    Mr. LaMalfa. So, what percentage of carbon dioxide is in 
our atmosphere?
    Mr. Bonnie. I have no idea.
    Mr. LaMalfa. Take a wild guess, sir.
    Mr. Bonnie. I won't even guess.
    Mr. LaMalfa. Okay. When I ask people this question, they 
will say oh, man, so much CO2. It must be 30, 40, 50 
percent of our atmosphere. I will say no, go lower. Well, how 
about four percent? No, go lower than that. How about .4 
percent? No, it is lower than that. It is .04 percent of our 
atmosphere is CO2. If you put it on a pie chart, the 
pie sliver is so small you can't even do it with your pen. So, 
the number used to be .03, so the number is creeping up a 
little bit. But we are blaming everything on CO2, to 
weather change and all that. So, the direction of all this is 
very disturbing that we haven't even talked about forest 
practices underneath USDA. I had a million-acre fire, just one 
of my many fires that happens every year in the district. 
Million acres allotted out in USDA lands. So, we want to talk 
about CO2 and emissions. What are the practices that 
are going to make our forests safer and not burn to the ground 
every year? 140 million dead trees are in the inventory of the 
Forest Service just in California, and so, hardly anything is 
getting done to promote things in forestry, which would 
actually make a big impact. Because more CO2 comes 
off these fires than is--like that million-acre fire--I forget 
the stats, but 10 years' worth of car driving in L.A.
    The Chair. The gentleman's time has expired.
    Mr. LaMalfa. Okay. So, we are talking----
    The Chair. I now recognize the gentlewoman from Virginia, 
Ms. Spanberger, for 5 minutes.
    Ms. Spanberger. Thank you so very much, Madam Chair. I 
appreciate the ongoing discussion, and certainly, when we look 
at the complications caused by CO2 within the 
atmosphere, the amount is not the central focal point. It is, 
in fact, the impact of said amount. A little bit of poison is 
still poison, and so, making sure that we are looking at the 
impact, is the value of the conservation programs to mitigate 
the impact of said CO2 and our focus on sequestering 
it.
    But Under Secretary Bonnie, I am really appreciative of 
your presence with us today. I chair the Conservation and 
Forestry Subcommittee, and I have been encouraged by how USDA 
has really prioritized engaging farmers on climate change and 
climate solutions over the last year to the benefit of the 
environment, and certainly to the benefit of the farmers.
    And as you mentioned in your testimony, climate-smart 
farming practices are not just good for the planet, but for the 
bottom lines of farmers and ranchers who want to compete 
internationally, improve their crop quality and yields, and 
certainly lower the costs of their inputs. I am really 
particularly excited by yesterday's announcement of the $1 
billion in funding to facilitate markets for environmentally 
sustainable commodities through the Partnerships for Climate-
Smart Commodities Program. This program will help ensure 
America's farmers, ranchers, and forestland owners can remain 
competitive internationally, certainly as demand for climate 
conscious products continue to grow, both at home and abroad.
    However, it is important to note that over the past decade, 
we have seen that as new markets emerge around climate-smart 
agriculture, they are not just for the commodities produced 
within these practices, but also for the carbon sequestered by 
these practices. And this has led to the proliferation of 
voluntary carbon markets that, while well intentioned, can be 
confusing to the public and growers and producers alike, 
particularly smaller family farmers and foresters. And that is 
why I was proud to introduce the bipartisan Growing Climate 
Solutions Act (H.R. 2820) alongside my colleague, Congressman 
Don Bacon of Nebraska. This legislation would empower USDA to 
help farmers navigate voluntary private carbon markets with 
confidence, and USDA's help will enable farmers to choose to 
participate, and whether they would choose to participate. 
Whether they would, in fact, collect a new stream of revenue 
for their work to sequester carbon, protect their land, reduce 
emissions, and most importantly, ensure that these practices 
are beneficial in our efforts to mitigate climate change. It 
would also create a certification program at USDA to ensure 
that those working in these markets are actually providing the 
support that farmers need to secure meaningful carbon 
reductions. The bill is almost universally endorsed by national 
farm groups and supported by dozens of prominent environmental 
groups and Fortune 500 companies, and last year, it actually 
passed the United States Senate with a vote of 92 to 8. So, we 
continue to ring the bell of this piece of legislation here in 
the House. Certainly, I think it is clear that it should move 
forward and towards a vote.
    But, Under Secretary Bonnie, I would want to ask, would 
passing legislation like the Growing Climate Solutions Act 
strengthen, from your perspective, the work that USDA is doing 
on climate-smart agriculture and forestry, particularly in the 
market facilitation space?
    Mr. Bonnie. Yes, and I want to thank you for your 
leadership on this. It is really important, and it is an area 
of work that is really important as we think about climate-
smart practices, carbon, greenhouse gases. Producers need good 
information, and you are exactly right. There is a lot of 
information out there. They don't always know how to sort 
through it, and less chaos out there is really important. And 
USDA potentially has a role, as your legislation points out, in 
helping producers sort through that, and thinking about 
certifying technical service providers and others.
    And, as we think about what the Secretary announced 
yesterday, there is actually an interesting fit there to help 
provide better technical assistance, better data, better 
information. So, yes, I think we recognize that your 
legislation fills a really important gap----
    Ms. Spanberger. Thank you.
    Mr. Bonnie.--and I think, one, that there will be more and 
more interest going forward around this issue of 
standardization of methodologies, of measurement, all that 
stuff is really important, and it is an area that I think USDA 
will move increasingly into.
    Ms. Spanberger. And just based on what it is you just said, 
I think that could have determined for the purposes of the rest 
of the Committee as well, if we are increasing transparency 
over our voluntary carbon markets, it seems to me that that 
could really serve to incentivize farmers to make use of the 
existing, again, voluntary conservation programs like EQIP, 
like RCPP, because those are going to be the climate-smart 
practices that are going to have the benefits and allow them to 
enter into these voluntary carbon markets. Would you agree with 
that assertion?
    Mr. Bonnie. Absolutely.
    Ms. Spanberger. Okay. Thank you so much, Under Secretary 
Bonnie.
    Madam Chairwoman, I yield back.
    The Chair. Thank you, Ms. Spanberger.
    Before we adjourn today, I want to invite the Ranking 
Member to share any closing comments that he may have.
    Mr. Austin Scott of Georgia. Thank you, Chair Bustos.
    Again, Under Secretary Bonnie, I want to thank you for your 
candor and the work you are doing. I look forward to working 
together to write a new farm bill that works for America's 
producers, and the people that are enjoying the food.
    I do want to mention just very briefly on the environment, 
we can and should do a better job of taking care of the 
environment. But when we talk about the environment, it is not 
just CO2. It is our forestlands and our wildlife 
habitat. It is our watersheds. There is a lot more to taking 
care of the environment than simply talking about greenhouse 
gas emissions. And certainly, good soil health is good for the 
farmer. No-till and other things that we have supported in the 
past need to continue to be a part of the discussion as we talk 
about the environmental practices and taking care of the 
environment as a whole.
    So, Chair Bustos, thank you for having the hearing, and 
again, Under Secretary, I want to thank you for your honesty, 
your candor, and I look forward to working with you.
    The Chair. Thank you to our Ranking Member, Mr. Scott, for 
joining me, and thank you to all of our Members who were on the 
hearing.
    Under Secretary Bonnie, thank you so much for being here 
today. We have learned a lot. It was a good discussion, good 
questions, good answers, and you know, obviously really, really 
critical for our Subcommittee and our oversight work.
    So, our goal as we move forward, we will continue to seek 
out regular input from our producers about what is happening on 
the ground. We look forward to having really what would be an 
open dialogue, I hope, with Mr. Bonnie and our colleagues here, 
along with your colleagues at the USDA about what the needs are 
in the countryside.
    Let me see. So, let me say the official stuff here. Under 
the Rules of the Committee, the record of today's hearing will 
remain open for 10 calendar days to receive additional material 
and supplementary written responses from the witness to any 
questions that have been posed by a Member.
    This hearing of the Subcommittee on General Farm 
Commodities and Risk Management is adjourned. Thanks everybody.
    [Whereupon, at 11:38 a.m., the Subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
                          Submitted Questions
Response from Hon. Robert Bonnie Under Secretary, Farm Production and 
        Conservation, U.S. Department of Agriculture
Questions Submitted by Hon. Cheri Bustos, a Representative in Congress 
        from Illinois
    Question 1. USDA's Risk Management Agency recently approved a new 
crop insurance policy for corn farmers to incentivize the adoption of 
split application of nitrogen, which will reduce nitrate pollution in 
our streams and rivers--a policy championed by the Illinois Corn 
Growers. Do you see further opportunities for USDA to use crop 
insurance to help farmers incorporate better conservation practices?
    Answer. Federal crop insurance is piloting the Post Application 
Coverage Endorsement, known as PACE, in 2022 to insure against the 
inability to make an in-season nitrogen application. The pilot should 
provide ample feedback to further refine PACE and expand it at an 
appropriate rate to both offer more coverage to producers while also 
protecting taxpayers. The Risk Management Agency will continue to use 
its existing authorities for product development, whether through the 
private submission process commonly referred to as 508(h) submissions, 
like that used for PACE, or through internal research and development, 
as authorized by Section 522 of the Federal Crop Insurance Act, to look 
for more opportunities for insuring risks associated with innovative 
conservation practices.

    Question 2. In recent years there have been multiple exciting 
developments in the biofuels industry, including in the ability to 
source low-carbon grain, traceable back to the farm level. How do you 
anticipate innovations like these will be captured in new programs, 
like the Partnerships for Climate-Smart Commodities?
    Answer. Partnerships for Climate-Smart Commodities will help USDA 
expand market opportunities for producers. These expanded markets for 
climate-smart commodities may include companies or processors sourcing 
climate-smart commodities to meet internal targets or other supply 
chain goals, biofuel and renewable energy markets, companies seeking to 
sell branded consumer products, or other opportunities that could 
provide a premium or additional revenue for participating producers and 
landowners. Applicants to Partnerships for Climate-Smart Commodities 
may propose and justify innovative biofuels projects that generate 
climate-smart commodities.
    Pilot projects will increase adoption of climate-smart agriculture 
and forestry (CSAF) production practices and systems, investment in 
scalable and low-cost measurement/quantification, monitoring, reporting 
(MMRV) systems, improve understanding and communication of the 
economic/adaptation/co-benefits of CSAF practices and systems, and 
support early adopters and underserved producers.
    Knowing how important it would be to capture these innovations to 
further expand markets for producers, as part of the program design all 
selected Partnerships for Climate-Smart Commodities projects are 
required to participate in a Partnerships Network. This Partnership 
Network will bring partners together virtually or in-person on a 
regular basis to share learnings and USDA will summarize and publish 
important information from these gatherings, as well as consolidated 
data from required project reporting.
    Partnerships for Climate-Smart Commodities presents an enormous 
opportunity to scale up and invest in innovative production methods 
that generate new markets and quantifiable climate mitigation benefits.

    Question 3. The 2018 Farm Bill strengthened the Transition 
Incentives Program (TIP) which incentivizes landowners to sell or rent 
expiring Conservation Reserve Program (CRP) acres to beginning and 
socially disadvantaged farmers who must return land to production using 
sustainable methods. How many acres have been returned to production 
through TIP and how can we improve this program?
    Answer. FSA is limited in the amount of TIP acres that can be 
enrolled by the amount of CRP acres expiring each year. In order to 
qualify for enrollment in TIP, land must be expiring CRP. FSA is in the 
process of implementing a notice of funding opportunity for the 
Transition Incentive Program (CRP-TIP). FSA is seeking to partner with 
and support the efforts of partner and stakeholder organizations to 
promote awareness, increase understanding among landowners and program 
participants, and increase enrollment in CRP-TIP by providing outreach 
and technical assistance to the agricultural community, private 
landowners, beginning farmers, underserved farmers and ranchers, 
conservation organizations, cooperating agencies, acequias, and land 
grants.
    The following table is a summary of TIP acres that have been 
enrolled through TIP since the 2018 Farm Bill:

------------------------------------------------------------------------
          Year                 TIP Contracts             TIP Acres
------------------------------------------------------------------------
             2019                         2                   22.54
             2020                       689              117,953.33
             2021                       437               81,147.15
             2022                        28                6,688.76
             2023                         4                  149.50
                         -----------------------------------------------
  Totals................              1,160              205,961.28
------------------------------------------------------------------------

Questions Submitted by Hon. Chellie Pingree, a Representative in 
        Congress from Maine
    Question 1. I have heard concerns that proposed changes to the 
apple crop insurance policy could have disproportionate negative 
impacts on apple growers in the Northeast, a region that is already 
underserved by crop insurance. How will USDA ensure that the apple 
policy remains viable for growers in Maine?
    Answer. RMA's proposed rule is designed to update the apple policy 
provisions to reflect current growing practices and to reduce abuse in 
the program, which will lower costs to all growers over time. RMA did 
extensive grower outreach prior to and during development of the 
updated policy for apples. RMA encourages producers to provide comments 
on the proposed rule and has also extended the initial comment period 
by an additional 60 days to give producers more time to have their 
voice heard. RMA will take those comments and information provided by 
growers and the public into consideration when drafting the final rule.

    Question 2. I appreciate the steps USDA has taken to provide dairy 
producers impacted by PFAS contamination with more options through the 
Dairy Indemnity Payment Program (DIPP), as well as your commitment that 
FSA will work with these producers so they have the flexibility to make 
an informed decision about the best path forward for their operation. 
An additional concern I've heard is that the DIPP indemnification 
calculation for the value of depopulated animals is based on the value 
of the average conventional dairy cow, which is not helpful to 
certified organic farms. As FSA works to implement the new DIPP 
changes, how will FSA ensure that organic producers are fairly 
compensated?
    Answer. FSA will accept applications for DIPP for all eligible 
dairy operations, regardless of size or organic/conventional status, 
that are affected by PFAS chemical residues and can no longer 
commercially market milk. Per the DIPP regulation published in December 
2021, cow indemnification will now be based on the 100 percent value of 
Livestock Indemnity Program (LIP) rates as applicable for the calendar 
year of milk indemnification. LIP has traditionally provided indemnity 
for animal losses due to disaster events at 75 percent of fair market 
value for the applicable farm animal. Unfortunately, the LIP rates do 
not provide specific rates for organic cows.
    However, for PFAS-related milk indemnity under DIPP, FSA has been 
able to support organic dairy operations with indemnity payments at the 
value of the organic market price. FSA will provide support according 
to program provisions to any organic dairy operation eligible for cow 
indemnification through DIPP.
Questions Submitted by Hon. Ann M. Kuster, a Representative in Congress 
        from New Hampshire
    Question 1. Mr. Under Secretary, I recently received USDA's 
response to a letter I co-signed in July requesting an increase to 
available supplies of sugar. In its response, USDA noted that it has 
taken action in recent months to rebalance the sugar market. While I 
applaud these actions, I remain concerned about the current sugar 
market. As USDA's response letter acknowledged, ``raw sugar prices are 
at a 9 year high'' and are ``inconsistent with market fundamentals.'' 
Does USDA have any plans to take further action to correct this 
imbalance? If so, can you share what actions USDA may take?
    Answer. USDA sugar analysts continually monitor sugar supplies and 
demand to maintain adequate supplies of raw and refined sugar as 
required by statute. While USDA took actions in December 2021 to 
address domestic sugar shortages (increasing the Fiscal Year 2022 OAQ 
to allow beet processors to market all their available production and 
requesting that the Department of Commerce increase Mexico's Export 
Limit by 150,000 short tons raw value of raw cane sugar to be exported 
no later than March 31, 2022) the efforts had little impact on prices. 
USDA analysts believe that the large beet crop loss in November 2019 
destabilized the market, and while corrective actions were taken using 
the tools at hand, it might take more time for the market to fully 
rebalance.
    USDA recognizes that, since last year, sugar prices seem too high 
given the market is operating within a 13.5 to 15.5 percent stocks-to-
use ratio--USDA's standard measure of adequate supply. With the added 
challenges related to COVID, it is unclear whether this is a permanent 
or temporary phenomenon. Analysts recognize that labor shortages and 
strains on truck, rail, and barge capacity have increased costs for 
sugar sellers as well as sugar users, similar to other commodities. If 
there is a supply response to current high prices, we expect a natural 
reduction in sugar prices to follow. In the meantime, USDA will 
continue to monitor the sugar supply situation and take actions to 
ensure adequate supplies.

    Question 2. Mr. Under Secretary, USDA's response letter also 
acknowledged that using ``traditional stocks-to-use ratio metrics,'' 
the market appears ``adequately supplied.'' I'm hearing a very 
different story from sugar-using industries across the country. Could 
the problem be that the ``traditional stocks-to-use ratio metrics'' 
employed to generate reports like the World Agricultural Supply and 
Demand Estimates need updating?
    Answer. With recent high sugar prices seemingly out of sync with 
the stocks-to-use ratio, USDA sugar analysts are continually monitor 
sugar supplies and demand. Most USDA sugar decisions are linked to the 
World Agricultural Supply and Demand Estimates (WASDE) report. In fact, 
Mexico's access to the U.S. market is defined by a formula in the U.S./
Mexican Suspension agreement that is based off the WASDE. However, the 
WASDE's purpose for any commodity, in its purest form, is to provide 
estimates/forecasts of stocks, production, imports, exports, deliveries 
and prices--and not to serve as a policy tool. Looking back over time, 
USDA finds much variability between monthly sugar forecasts and final 
actual values. With the Suspension Agreement requiring strict adherence 
to the WASDE during certain months, Mexico's calculated access may be 
inadequate for rebalancing the market. USDA is not suggesting that the 
Suspension Agreement terms be altered. However, USDA has the discretion 
to recognize the existence of certain factors that are not reflected in 
the WASDE when making sugar supply decisions.
Question Submitted by Hon. Glenn Thompson, a Representative in Congress 
        from Pennsylvania
    Question. Mr. Under Secretary, on September 30, 2021, Congress 
enacted $10 billion in disaster assistance for producers who suffered 
crop losses in 2020 and 2021. To date, USDA has not made any additional 
information available to producers about how these funds will be 
dispersed or how losses will be calculated. Having a clear 
understanding of a farm's financial picture for the upcoming year is 
vitally important, especially in light of the volatility and 
unpredictability of markets and growing conditions producers are 
experiencing. This $10 billion in assistance was intended to be a 
simple extension of previous rounds of aid enacted for 2017, 2018, and 
2019 losses, for which regulations have already been written, which 
makes the delays even more concerning.
    Please provide in detail how USDA will provide disaster assistance 
to producers for their 2020 and 2021 losses. Please specify what 
program parameters USDA intends to change from the Wildfire and 
Hurricane Indemnity Program Plus (7 CFR Subpart O) which covered 2018 
and 2019 losses. For each of these changes specify if it was required 
by statute or a change that is at the discretion of USDA, and for each 
discretionary revision provide the rational for such change. Finally, 
up to $100 million was designated for use in implementing the program. 
How will those funds be used to simplify the application process and 
reduce workload on FSA county office employees?
    Answer. USDA is working expeditiously to implement the $10 billion 
in disaster assistance signed into law on September 30, 2021, as part 
of the Extending Government Funding and Delivering Emergency Assistance 
Act (P.L. 117-43). After engaging with several stakeholder 
organizations to better understand emergency relief needs, USDA's Farm 
Service Agency is working to specifically develop two programs, the 
Emergency Livestock Relief Program (ELRP) and the Emergency Relief 
Program (ERP), both of which will be administered via a two-phased 
process. FSA cannot yet share the differences between ERP and the 
Wildfire and Hurricane Indemnity Program Plus, given that both ELRP and 
ERP are currently in final development. However, we can share that the 
Department is focused on streamlining the application process to reduce 
the burden on producers and county offices, proactively include 
underserved producers who have been left out of past relief efforts, 
and encourage participation in existing risk management tools that can 
help producers navigate future extreme weather events.
    USDA will follow a two-phased process to administer relief to 
eligible livestock and crop producers, with the first phase utilizing a 
streamlined process that relies on existing data that producers have 
already reported to USDA.
    For the first phase of ELRP, USDA will leverage Livestock Forage 
Disaster Program \1\ (LFP) data to administer relief to impacted 
ranchers. LFP is an important tool that provides up to 60 percent of 
the estimated replacement feed cost when drought adversely impacts 
grazing lands. FSA continues to tally 2021 LFP applications filed by 
the January 31, 2022, deadline, but early estimates show 100,000 
applications totaling more than $670 million in payments to livestock 
producers under LFP. This will streamline the application process to 
require no or minimal additional paperwork. FSA announced phase 1 of 
ELRP on March 31, 2022.
---------------------------------------------------------------------------
    \1\ https://www.fsa.usda.gov/programs-and-services/disaster-
assistance-program/livestock-forage/index.
---------------------------------------------------------------------------
    The broader ERP will provide assistance to crop producers and 
follow a two-phased process similar to that of the livestock assistance 
with implementation of the first phase this spring. Phase one of the 
crop assistance program delivery will use existing Federal Crop 
Insurance \2\ or Noninsured Crop Disaster Assistance Program \3\ data 
as the basis for calculating initial payments. Making the initial 
payments using existing safety net and risk management data will both 
speed implementation and further encourage participation in these 
permanent programs, including the Pasture, Rangeland, Forage Rainfall 
Index Crop Insurance Program, as Congress intended.
---------------------------------------------------------------------------
    \2\ https://rma.usda.gov/.
    \3\ https://www.fsa.usda.gov/programs-and-services/disaster-
assistance-program/noninsured-crop-disaster-assistance/index.
---------------------------------------------------------------------------
    The second phase of both the livestock and crop programs will fill 
additional assistance gaps and cover eligible producers who did not 
participate in these existing programs. Through proactive communication 
and outreach, USDA will keep producers and stakeholders informed as 
program details are available.
    USDA has also developed a detailed spend plan to utilize the $100 
million designated for use in implementing the relief to support 
staffing needs, both overtime and temporary, along with information 
technology needs and outreach efforts that will result in a streamlined 
approach for our county offices and leverage partners to ensure broad 
awareness and access to the programs.

                                  [all]