Food stamps to get $1 billion more in farm bill

WASHINGTON (Reuters) - Food stamp benefits will rise by $1 billion because of savings from crop supports in the farm bill awaiting Senate debate, senators from farm states said on Thursday.

The money became available because the Senate Agriculture Committee voted last week to alter the proposed "average crop revenue" program. ACR would be the first federal farm program to guarantee a revenue level for growers.

Congressional budget specialists said the changes freed enough money to add $1 billion to food programs, mostly for larger food stamp benefits, after boosting the size of an annual payment to grain, cotton and soybean growers under ACR.

With the increase, the Senate farm bill would put an additional $5 billion into pubic nutrition through 2012. It also boosts funds for land stewardship and renewable energy such as ethanol.

Chairman Tom Harkin said Agriculture Committee members agreed to put almost all of the latest savings into food programs. Committee members rejected a proposal last week by Indiana Republican Richard Lugar to cut farm payments by $1.7 billion to expand public feeding programs.

Lugar told reporters he would seek a Senate vote next week to scrap the decades-old farm program and replace it with government-paid insurance policies to assure all farmers of getting at least 80 percent of their usual farm revenue. He did not rule out a new effort to add money to food programs too.

Iowa Republican Charles Grassley says Lugar's proposal probably would get 30 to 35 votes in the 100-member Senate.

Grassley wants to amend the farm bill to set a "hard" cap of $250,000 a year in crop subsidies per farmer, compared with the current limit of $360,000. Grassley says odds favor victory on payment limits.

Under the average crop revenue plan, farmers would get a payment when revenue at the state level fell below a guaranteed level. They also would receive an annual payment of $15 an acre based on plantings of grain, cotton and oilseeds. ACR would begin in 2010 as an option to traditional crop supports.

Agriculture Committee members voted last week to delete a provision that offered lower crop insurance rates to farmers who enroll in ACR. They also voted to make annual payments and revenue payments on 85 percent of eligible crop land and to give less money to crop insurers for operating expenses.

After the Congressional Budget Office calculated the savings at $1.092 billion, committee members decided to make the annual payment on all eligible acres and put $1 billion in public nutrition, Harkin, an Iowa Democrat, said in a statement.

The additional funding would allow people to have slightly larger assets -- $3,000 in most households -- and increase the monthly benefit, now $10, to 10 percent of the largest benefit for one person. At current rates, that would be $18. At present, the asset limit is $2,000 for most households.

Corn growers say ACR is less attractive without lower crop insurance rates.