Dairy’s Future Requires New Ways of Thinking

A Letter from Secretary of Agriculture Russell Redding

Like many of you, what is happening now in our dairy industry has me concerned, but I have faith that the strength and enduring spirit of our agriculture industry—especially our dairy sector—will see us through this crisis. As the recent economic impact analysis of Pennsylvania’s agriculture and food industries made clear, there are tremendous opportunities before us, and Pennsylvania’s leaders from Governor Wolf to the General Assembly and the Department of Agriculture are committed to helping dairy farmers affected by this tightening dairy market take full advantage of those opportunities, while helping them to manage in the short run.

I recently testified before the House Agriculture Committee on the current state of Pennsylvania’s dairy industry. I was joined by the Chairman of the Senate Agriculture Committee, Sen. Elder Vogel, whose background is in dairy farming, just like mine. During that session and recent budget hearings, I was asked by legislators what could be done to help.  One representative asked if the dairy industry is costing me sleep.

“Yes,” I replied, “it is.” I know the same can be said for many of you.

Like you, I wake up at nights wondering how we got here and what the future holds. We find ourselves in a market where milk prices are increasingly subject to global market forces; where there are limits to what the United States, much less one state like Pennsylvania, can do to balance supply and demand. The trend we’ve seen in Pennsylvania over the last two decades may continue if we lose dairy farmers whose cows go on producing in someone else’s herd, keeping downward pressure on prices while negatively impacting communities, farms, and related industries.

But we are not without hope and reason for optimism.

According to our economic impact analysis, Agriculture accounts for roughly 18 percent of Pennsylvania’s Gross State Product today, with an annual economic impact of $137.5 billion. The report found promising signs for dairy and a separate study of the state’s processing capacity potential was likewise encouraging. The bottom line is that there are opportunities, and that dairy will remain a key part of our agricultural sector for the foreseeable future, although the decisions dairy farmers and the commonwealth face over the next 12 to 18 months will significantly shape its prospects.

Dairy farms across Pennsylvania have a breadth of options and resources at their disposal as they consider their next step. Some of these options include:

The Center for Dairy Excellence for business tools to help manage production costs and optimize herd health;

Ideas for diversifying your operation and income sources or transitioning to organic products where demand is growing, but supply remains inadequate;

Potential financing options beyond traditional lenders;

Direct marketing services, as consumer interest in buying local is at an all-time high; and

Revisiting risk management programs, including the recently reformed Margin Protection Program.

The Department of Agriculture supports the commonwealth’s dairy farmers, and is committed to providing communities with the resources and connections they need to ensure that our dairy industry will thrive in the years to come. To be successful, though, will require new ways of thinking.

Perhaps Franklin D. Roosevelt said it best as the nation was searching for solutions amid the depths of the Great Depression, “It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something.”

Those words of wisdom are particularly apt today as we find ourselves in these challenging times. Many dairy families are wondering how did we get to this point. Again, I say that you’re not alone. There are plenty of good producers out there who are facing the same hardships, the same questions, the same difficult choices you are. We’re at this point because of factors no one individual, organization, or government entity could control alone. It’s been a confluence of factors over nearly 20 years, but now that we’re here, one thing that won’t solve the problem is standing still, holding onto the past rather than planning and acting for the future. We’re committed to being here with you throughout that process.

 

Secretary Russell Redding

Pennsylvania Department of Agriculture

PSCFO Election Preview 2016

PA SENATE

There are 50 Senate seats of which 25 are up in this election.  Of these, 13 incumbents had no opponent.  There are three open seats because of retirements: Pat Vance (R-Cumberland) and John Wozniak (D- Cambria) and one, Lloyd Smucker (R-Lancaster), the Republican nominee in the 16th congressional district, the one being vacated by Rep. Joe Pitts.  Incumbents are bolded.

District            Counties                     Who                            Party               Occupation

5                      Phila.                           Ross Feinberg              R                      no info available

5                                                          John Sabatina D                                 PA Representative

9                      Delaware                     Tom Killion                 R                      insurance producer

9                                                          Marty Molloy               D                     nonprofit group

13                    Lancaster                     Scott Martin                 R                      county commissioner

13                                                        Greg Paulson               D         legislative aide to Dem. Rep.

15                    Dauphin, Perry             John DiSanto                R                      developer

15                                                        Rob Teplitz                  D                     attorney

17        Delaware, Montgomery             Brian Gondeck             R                      attorney

17                                                        Daylin Leach               D                     attorney

19                    Chester                        Jack London                 R                      insurance producer

19                                                        Andy Dinniman           D                     legislator

25        Jefferson, Clearfield, etc.          Joe Scarnati                R                      local official

25                                                        Jerri Buchanan             D                     information unavailable

31        Cumberland, York                    Mike Regan                  R                      legislator

31                                                        John Bosha                  D                     pharmacist

35        Bedford, Cambria                     Wayne Langerholc       R          assistant district attorney

35                                                        Ed Cernic                     D                     county controller

37        Washington, Allegheny Guy Reschenthaler                 R                      district judge

37                                                        Ed Eichenlaub              D         environmental health specialist

41        Indiana, Butler, Armstrong        Don White                   R                      insurance producer

41                                                        Tony DeLoreto             D                     restaurant owner

49                    Erie                              Daniel Laughlin             R                      home builder

49                                                        Sean Wiley                   D         health system foundation          

The only working farmer running is Senate Agriculture & Rural Affairs Chair Elder Vogel (R-Beaver).  A Senate candidate with a farming background is Lancaster County Democrat Greg Poulson running for the open seat vacated by Senator Lloyd Smucker who gave up his Senate seat to run for Congress.  Poulson says that his father was an organic farmer.  As a Representative, Senator Sabatina served as Minority Chair of the House Agriculture & Rural Affairs Committee.

Senate Agriculture & Rural Affairs Committee members running for re-election are Majority Chair Elder Vogel, Minority Chair Judy Schwank (D-Berks), Dave Argall (R-Schuylkill), Gene Yaw (R-Lycoming) – He is Majority Chair of the Senate Environmental Resources & Energy Committee –, Kim Ward (R-Westmoreland), Andy Dinniman (D-Chester), and Rob Teplitz (D-Dauphin/Perry).

 PA HOUSE

There are 203 House seats and all are up for election each two years.  98 seats are uncontested.  Those on the House Agriculture & Rural Affairs Committee who are unopposed include:  Majority Chair Martin Causer (R-McKean), Minority Chair Mike Carroll (D-Luzerne), are unopposed.  The only Representative with a working farm operation is Rep. Mark Keller (R-Perry) who is also unopposed.  Incumbents are bolded.  Contested races include:

District                        Counties         Who                            Party               Stated Occupation

199                  Cumberland                 Stephen Bloom             R                      attorney

199                                                      Jill Sunday Bartoli        D                     info not available

164                  Delaware                     Inderjit Bains               R                      auto repair shop owner

164                                                      Margo Davidson         D                     non profit

102                  Lebanon                       Russ Diamond             R                      business owner

102                                                      Jake Long                    D                     volunteer advocate

194                  Phila./Montgomery       Bill Pounds                  R                      non-profit

194                                                      Pam DeLissio              D                     legislator

137                  Northampton                Joe Emrick                  R                      teacher

137                                                      David Mattei                D                     insurance agent

89                    Franklin                       Rob Kauffman            R                      legislator

89                                                        Christine Tolbert          D                     retired teacher

114                  Lackawanna                 Cheryl Scandale-Murnin  R                   adjunct faculty

114                                                      Sid Michaels Kavulich  D                    communications spec.

13                    Chester/Lancaster         John Lawrence           R                      legislator

13                                                        Nancy Dean                 D                     info not available

40        Washington/Allegheny             John Maher                R                      accountant

40                                                        Andrew Zahalsky         D                     oncologist

51                    Fayette Somerset          Tim Mahoney             D                     legislator

51                                                        Matthew Dowling         R                      non-profit

133                  Lehigh                         Daniel McNeill             D                     retired

133                                                      David Molony              R                      acupuncturist

109                  Columbia                     Dave Millard               R                      legislator

109                                                      Eddie Sanders III          D                     landscaper

91                    Adams                         Dan Moul                    R                      legislator

91                                                        Denise Weldon-Siviy    D                     professional writer

99                    Lancaster                     David Zimmerman      R                      legislator

99                                                        Duane Groff                 D                     info not available

NOTE: Rep. Maher formerly chaired the House Agriculture & Rural Affairs Committee.

NATIONAL RACES AND AGRICULTURE

Hillary Clinton: “Too many rural communities aren’t reaping the rewards of our nation’s economic success—despite their critical role in our economy. Unemployment and poverty rates present a real challenge to these communities while accessible health care and education are too often out of reach”.  https://www.hillaryclinton.com/issues/rural-communities/

  • Create a national infrastructure bank to improve rural transportation and broadband access and grow the rural economy by expanding access to capital; expand the New Markets Tax Credit to encourage investments to prevent communities from spiraling downward after a major economic shift or plant closing.
  • Increase funding to support the next generation of farmers and ranchers in local food markets and regional food systems; create a focused safety net to help family farms get through challenging times.
  • Assisting farms that conserve and improve natural resources; strengthen the Renewable Fuel Standard and double loans that help support the bio-based economy.
  • Health: Support for rural telemedicine and Medicaid expansion
  • Democratic Platform also includes support for Regional Conservation Partnership Program, support for commodity price support safety net.

Donald Trump:  There is no specific agriculture/rural issues tab on the campaign website but he has taken public positions on issues that impacting the agricultural economy.  https://www.donaldjtrump.com/positions

  • Trade: Opposes the Trans-Pacific Partnership which many ag associations support as opening trade opportunities; renegotiate NAFTA
  • Opposes Waters of the United States (WOTUS)
  • Pro energy development with natural gas and coal
  • Scaling back “years of disastrous regulations unilaterally imposed by our out of control bureaucracy” and imposing a moratorium on most new regulations
  • Continue ethanol and biofuel blending subsidies
  • Republican Platform also includes supporting a market-oriented commodity price safety net, separating SNAP (food stamps) from the Farm Bill and removing it from the USDA, and support of Crop Insurance

Jill Stein:  Avoid chronic diseases by investing in local, fresh, organic food systems; ensure that consumers have better information about food – country of origin, GMO content, toxic chemical ingredients; ban pesticides that threaten survival of pollinators; moratorium on GMOs and pesticides until they are proven safe; support organic and regenerative agriculture, and sustainable forestry. http://www.jill2016.com/

Gary Johnson:  Neither his website or the Libertarian Party Platform have a stated position on agriculture but the Libertarian Party 2016 Platform addresses property rights:  “Respect for property rights is fundamental to maintaining a free and prosperous society. It follows that the freedom to contract to obtain, retain, profit from, manage, or dispose of one’s property must also be upheld. Libertarians would free property owners from government restrictions on their rights to control and enjoy their property, as long as their choices do not harm or infringe on the rights of others. Eminent domain, civil asset forfeiture, governmental limits on profits, governmental production mandates, and governmental controls on prices of goods and services (including wages, rents, and interest) are abridgements of such fundamental rights.”

Preview of 2015 Legislation

Pa-capitol-300x250 LegislationHARRISBURG – A month before the start of the new session, there were 60 sponsorship memos from 22 Representatives while 29 Senators distributed 107 sponsorship memos for new legislation.  Sometimes, the legislation is a commemoration of an historic event but mostly, these were substantive proposals dealing with criminal, tax, and State Budget issues.  Several dealt with tort reform issues such as:

  • Statute of Repose (time when a lawsuit can be filed) by Rep. Rob Kauffman (R-Franklin)
  • Right to file discrimination claims in court from Rep. Mark Cohen (D-Phila.)
  • False Claims Act (penalties for those who make false claims who have government funding sponsored by Rep. Brandon Neuman (D-Washington)

Others are repealing Pennsylvania’s Inheritance Tax from newly-elected Senator Michelle Brooks (R-Mercer) and making use of a hand-held mobile device while driving an offense with fines starting at $50, sponsored by Senators John Wozniak (D-Cambria) and Rob Teplitz (D-Dauphin)

Majority and Minority Chairs of the Senate Agriculture & Rural Affairs Committee (Senators Vogel and Schwank) distributed a sponsorship memo re PA’s Farmland Preservation and Forest Land Assessment Act (Clean and Green) program.  It would allow a landowner to lease an area to a third party for a rural enterprise as currently defined for Farmland Preservation purposes.  Senator Vogel also issued a sponsorship memo for his re-introduction of last session’s Senate Bill 944 to authorize a competitive bid verified nutrient procurement program to reduce Chesapeake Bay Total Maximum Daily Load (TDML) compliance costs.

Tax Break Extended for Ag Equipment

tax break on ag equipment Legislation extending the Section 179 tax break for small-business capital purchases passed Congress and was signed by President Barack Obama Friday.

Area farming officials, especially farm equipment dealers, were eying the legislation nervously prior to its passage. The tax bill allows farmers and small businesses to immediately write off up to $500,000 in capital assets purchases (including farm equipment) instead of depreciating it over time.

Section 179 tax deductions are good on new and used equipment, which must be financed/purchased by the end of the day on Dec. 31, 2014.

For more go to the Central Pennsylvania Business Journal

Farm Show Releases Schedule

farm-show-logo-2015The 2015 Farm Show tentative schedule has been posted on the Farm Show’s web site, http://www.farmshow.state.pa.us/page/show.aspx.   Running January 10-17, the Farm Show expects record numbers of exhibits, programs, and attendees.  In addition, the Food Court and Equine Arena will be open from 12-9:00 p.m. on Friday January 9.  The PA Farm Show is the largest indoor agricultural event in the United States and has 13,000 agricultural exhibits and over 300 commercial vendors.

Regulatory Note

Gas CanThe PDA announced that it had adopted the latest automobile fuel standards for automotive spark ignition engines based on the latest standards of the American Society for Testing and materials as determined by the US Federal Trade Commission.  Details: PDA Bureau of Ride and Measurement Standards 717/787-9089.

Legislative Updates July 2014

Legislative Pa. CapitolUpdates

  • House Bill 1996 (Lawrence-R-Chester) calling for transparency in milk pricing “over order premiums” (Milk Marketing Board fee per gallon of milk that is supposed to go back to dairy farmers) was reported out of the House Agriculture & Rural Affairs Committee July 1 and was re-referred to the House Rules Committee.
  • Adopted by the House unanimously was House Resolution 930 (Hahn-R-Northampton) declaring August as “PA Produce Month”.
  • Signed into law by Governor Corbett were several laws dealing with hunting/fishing: Free fishing and hunting licenses for disabled veterans (SB 1090/Act 80, SB 1102/Act 81); Elk hunting tag (HB 2169/Act 116). In addition, the Governor also signed:
    • SB 1287 regarding snowmobiles and all-terrain vehicles as Act 111
    • SB 1261 under the Dog Law administered by PDA increasing penalties for torture and murder of dogs used in law enforcement as Act 110
    • SB 177 regarding Lyme disease education as Act 83
  • Senate Bill 1188 (Vogel-R-Beaver) re-establishes regulatory oversight of the racing industry under the PA Gaming Control Board. Status: Passed the Senate and referred to the House Agriculture & Rural Affairs Committee June 29, 2014.

U.S. Exempts Livestock Haulers from Rest-Break Rule

FMCSA Logo 317x170On June 6, the Federal Motor Carrier Safety Administration granted a one-year exemption for livestock haulers to a rule that took effective July 1, 2013 requiring commercial truck drivers to take a 30-minute rest break after eight hours of service. In requesting the exemption, the National Pork Producers Council maintained that drivers’ service time includes loading and unloading animals and that mandating a break would affect the animals’ welfare.

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