US Congress tax deal extends 2008 Farm Bill

Extension gives government time to come up with more permanent solution

The 2008 Farm Bill was extended by nine months as part of a tax deal approved by the U.S. Congress in order to give the government more time to come up with a five-year replacement, according to reports. The extension also prevents steep increases in milk prices — without an agreement, dairy subsidies would have reverted back to 1949 levels, and retail milk prices could have doubled in the near future.

So far, lawmakers have been unable to finalize a new $500 billion, five-year farm bill to replace the 2008 legislation, which authorizes spending on food stamps and crop subsidies. They had agreed to eliminate $5 billion in annual direct payments to grain, cotton and soybean growers. Three dozen programs in the law have no money left, including disaster relief and biofuel development as well as a soil conservation program and some rural economic development and agricultural research programs.

A one-year fix had also been drafted that included disaster relief money for livestock producers hurt by drought, and would have created a dairy subsidy program to compensate farmers when feed costs are high and milk prices are low.