[fullwidth background_color=”” background_image=”” background_parallax=”none” enable_mobile=”no” parallax_speed=”0.3″ background_repeat=”no-repeat” background_position=”left top” video_url=”” video_aspect_ratio=”16:9″ video_webm=”” video_mp4=”” video_ogv=”” video_preview_image=”” overlay_color=”” overlay_opacity=”0.5″ video_mute=”yes” video_loop=”yes” fade=”no” border_size=”0px” border_color=”” border_style=”” padding_top=”20″ padding_bottom=”20″ padding_left=”0″ padding_right=”0″ hundred_percent=”no” equal_height_columns=”no” hide_on_mobile=”no” menu_anchor=”” class=”” id=””][title size=”1″ content_align=”left” style_type=”underline solid” sep_color=”#000000″ margin_top=”” margin_bottom=”” class=”” id=””]Federal crop insurance critics propose $24 billion in cuts to program[/title][fusion_text]Wednesday, November 4th 2015
Critics of federal crop insurance are proposing to cut about $24 billion from the program, far more than what was included in a congressional budget agreement. Bills being introduced in the House and Senate would cut $19 billion over 10 years by eliminating the Harvest Price Option on revenue policies. The rest of the savings would come from slashing returns to crop insurance companies and agents and cutting farmers’ premium subsidies. The program is estimated to cost about $8 billion to $9 billion a year. The legislation, known as the Assisting Family Farmers through Insurance Reform (AFFIRM) Act, includes a $3 billion reduction in insurers’ rate of return that is contained in the budget deal President Obama signed into law on Monday, but Senate and House Republican leaders have pledged to reverse the cut before it can take effect. Under the provision, the insurers’ rate of return would be reduced to 8.9 percent. The bill represents a collection of cuts that have been proposed to crop insurance in Congress by Kind, Flake and others, or by the White House in recent years. The provisions include a $40,000 cap on premium subsidies and a means test for premium subsidies that when combined would save $2.3 billion over 10 years. Farmers with more than $250,000 in adjusted gross income would be ineligible for premium subsidies, under the bill. A version of the AFFIRM Act introduced in 2013 was estimated to save $11 billion. The new bill also would cap insurers’ administrative and operating costs at $900 million a year, saving the government $3 billion over 10 years.
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