Gop Reaches Deal On Farm Cuts

House and Senate Republicans have reached a compromise package of $12.3 million in farm spending cuts that will guarantee wheat farmers about 60 cents a bushel in annual subsidies through 2002.

But Democratic leaders, saying the cuts are too deep, said President Clinton will veto the plan if it gets through Congress.

Keying on programs that often dump more than $100 million a year directly into the Inland Northwest economy, the Republicans’ original plan called for $13.4 billion in cuts as agriculture’s share of balancing the federal budget by 2002. The cuts were reduced when no agreement could be reached on dairy programs.

The proposal would no longer tie government subsidies to crop production, leaving U.S. farmers and consumers at the mercy of market forces for the first time in decades.

Farmers would gain the freedom to plant whatever the market demands as they are slowly weaned from federal subsidies. But consumers might have to pay higher food prices should supplies of certain crops run low.

The plan would require farmers to continue to comply with existing conservation compliance and wetlands protection rules. It also would reduce the annual payment limitation from $50,000 to $40,000.

Details of the plan include:

A flat payment to wheat farmers of about 60 cents per bushel would be made on 85 percent of their historic base acres, congressional sources said. That compares to the average payment of 75 cents per bushel during the last five years.

Farmers would receive payments regardless of what crop they grow, with the exception of fruits, vegetables and hay. The remaining 15 percent would be free from any planting restrictions.

The Conservation Reserve Program, which has idled 36.4 million highly erodible acres, would be capped at that level. But farmers enrolled in the program for more than three years could opt out without penalty, giving them the freedom to bust out the sod in time for a 1996 crop.

The Farmer-Owned Reserve, a popular program in the Pacific Northwest, would be eliminated.

The Export Enhancement Program, which subsidizes wheat sales overseas, would be capped at $350 million in 1996 and 1997, down from $800 million in recent years. Spending in future years would fluctuate from $478 million to $579 million.

Crop insurance would no longer be mandatory, but producers who opt out are ineligible for federal disaster assistance.

“The beauty of these proposals is that farmers will know the minimum amount they can expect in the future,” said Gary Mitchell, chief of staff for the House Agriculture Committee. “They can start planning accordingly for less government involvement in the year 2003.”

Democrats, however, said the cuts are too severe. Senate Minority Leader Tom Daschle, D-S.D., said he had secured a commitment from Clinton that the president would list the farm cuts as “one of the major reasons” for vetoing the budget-balancing bill.

, DataTimes The following fields overflowed: CREDIT = Grayden Jones Staff writer The Associated Press contributed to this story