Plan to accelerate farm payments in development

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(Host) With federal disaster relief funds stalled in Congress, dairy farmers are facing a long winter of high feed and fuel prices.

So lawmakers and the Douglas Administration are working on a plan to get a bit more money into farm bank accounts by the end of the year.

VPR’s John Dillon reports:

(Dillon) The plan now being developed in Montpelier is to accelerate payments under an existing emergency assistance program.

Last summer, farmers faced record low milk prices and crops ruined by heavy rains.

So the state came up with an $8.6 million program that ensured farmers got paid a support price of $14 for every hundred pounds of milk.

Milk prices have improved since then. That means the amount paid out by the state has declined and under the original formula, payments would be stretched out for several more months.

The state has about $2.5million left in the $8.6 million emergency appropriation.

Administration Secretary Michael Smith says
officials now want to get the funds to farmers as quickly as possible.

(Smith) “What the governor has asked me to do is figure out a mechanism to make sure that this money can go out before the end of December.”

(Dillon) Even with milk prices improving, farmers are still facing a cash flow crunch. The House and Senate Agriculture Committees recently held hearings around the state. They learned that farmers owe feed and equipment dealers about $100 million.

Franklin Senator Sarah Kittell chairs the Senate Agriculture Committee. She says farmers face steep prices when they go to buy feed for the winter.

(Kittell) “I think the figure was 23 to 25% increase in feed costs in the last couple of months. So I think it’s a critical time on the farm still.”

(Dillon) The state program was designed to be a stop-gap measure that would help until Congress passed a disaster relief package.

The federal plan was supposed to send an estimated $54 million to Vermont. But the legislation remains stalled, and could get delayed until the next Congress.

Meanwhile, administration Secretary Smith says Vermont may want to come up with a state program that could step in the next time milk prices fall.

(Smith) “My understanding is that milk prices are rising to the $15 to $17 range over the course of the next six months or so. I think what we need to do is take a careful look at how we build a counter-cyclical program when the next trough comes in.”

(Dillon) Smith says the administration is ready to work with lawmakers on the plan, which he says could be in ready in two years.

For Vermont Public Radio, I’m John Dillon in Montpelier.

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