Lawmakers try to add disaster aid to Iraq bill

By Christopher Doering

WASHINGTON (Reuters) - Democrats in the U.S. House of Representatives will try to include farm disaster aid of more than $3 billion in a spending bill for the war in Iraq, the House Agriculture Committee chairman said on Thursday.

Congress hopes to pass the Iraq supplemental spending bill in the next month or two with funding expected to total more than $100 billion if assistance for Hurricane Katrina and farm aid are included.

Disaster relief would be offered on losses due to bad weather during 2005, 2006 and 2007, including recent cold weather in California and winter storms in other parts of the country. Farmers would be offered compensation on only one year where they experienced a loss.

"I think it's pretty clear you're only going to be able to pick one year out of the situation," chairman Collin Peterson, a Minnesota Democrat, told reporters. He estimated the package would be more than $3 billion.

"It's not going to be as generous as what has been talked about in the Senate," he said.

A $4.5 billion agriculture disaster measure was introduced by Sen. Kent Conrad, a North Dakota Democrat, on Thursday to provide crop disaster assistance, livestock provisions, conservation funds and other aid. A similar package was rejected last December.

Peterson also said he was optimistic the Milk Income Loss Contract would be extended a month to September 30 at a pricetag of $40 million. The House Appropriations Committee would likely include MILC in the Iraq bill.

Extending MILC from August 31 would restore the baseline "and give us the resources to extend the program," he said.

Establishing a baseline would extend the MILC program for five more years without requiring the House Agriculture Committee to come up with additional money to fund it.

MILC sends a check to dairy farmers when the price for fresh milk bound for grocery stores falls below $16.94 per 100 lbs. Each farm is eligible for payments on up to 2.4 million lbs of milk a year, equal to the production from 123 cows.

USDA proposed reviving the MILC subsidy as part of its $87.3 billion farm bill plan released last month. Payments, made on up to 2.4 million lbs of milk per year per farm, would begin at 34 percent, and decline to 20 percent over five years.

The House and Senate Agriculture Committees are both in the early stages of crafting a farm bill to replace the 2002 measure that expires in September. Peterson said he expected to know within two or three weeks how much money to request from the House Budget Committee for the House plan.