November 19, 2018

As Final Farm Bill Negotiations Continue This Week, Gillibrand Calls On President Trump To Reject Any Farm Bill That Does Not Include Refund For Dairy Farmers Who Paid Into Failed Insurance Program

Gillibrand Successfully Secured $73 million in Senate-Passed Farm Bill to Put Money Back into the Pockets of New York Dairy Farmers

Washington, DC – As the Farm Bill Conference Committee works to craft a final Farm Bill in the final days of the current session of Congress, today U.S. Senator Kirsten Gillibrand called on President Trump to only support a Farm Bill that includes a refund for the failed Dairy Margin Protection Program and puts money back into the pockets of New York dairy farmers.

“Our dairy farmers have been suffering from abysmally low milk prices, unfair trade policies, and a failed insurance system for too long, which is why I fought to get $73 million in the Farm Bill for our dairy producers. The Farm Bill is our chance to finally fix some of these problems, and I urge President Trump to only support a final bill that includes my Dairy Premium Refund Act that would issue a refund to farmers who participated in the failed Dairy Margin Protection Program,” said Senator Gillibrand. “President Trump should reject any Farm Bill that comes to his desk that doesn’t give our dairy farmers the support and protection they urgently need. I will always do everything I can to continue fighting for our dairy farmers, and I urge my colleagues and the President to do the same.”

The Dairy Margin Protection Program (DMPP) is the main insurance option for dairy farmers to protect their revenue when the price they receive for their milk falls or feed costs rise. Since 2014, thousands of New York dairy farmers paid millions of dollars to the USDA for this coverage, but when milk prices and feed prices fell at the same time, most farmers lost money on every pound of milk they sold and never received a payment.

The bipartisan Farm Bill passed by the Senate in July included Gillibrand drafted provision that would secure $73 million for dairy farmers who paid millions of dollars into an insurance program that did not help them when milk prices dropped. This provision would ensure that dairy farmers automatically receive a refund check for any MPP insurance premium funds not used to pay claims to them ‎during the previous year. Currently, these remaining funds are returned to the U.S. Department of Treasury rather than to the farmers who paid them.

A copy of Gillibrand's letter may be found here and below:

November 19, 2018

The Honorable Donald J. Trump

President of the United States of America

1600 Pennsylvania Ave. NW

Washington D.C. 20500

Mr. President:

As the principals of the 2018 Farm Bill Conference Committee resume their work in the waning days of the current Congress, I write to urge you to support a Farm Bill only if it has at its core the interests of the American dairy farmer. Now is a time of unprecedented distress on dairy farms in every state and a failure to take meaningful action may condemn hundreds of dairy farms and farm families to financial ruin. As a fellow New Yorker, you know the important role that dairy plays in our state and you have spoken frequently in support of dairy farmers and their rural communities. Therefore, I urge you to keep your word and sign a Farm Bill that ensures our dairy farmers will have the tools and resources they need to succeed.

By every measure and across every product class, milk prices remain well below historic averages and, for many farmers, below the cost of production that means they lose money on every pound of milk they produce. In this fourth year of declining milk prices and farm incomes, farmers face additional challenges caused by shrinking access to foreign markets and uncertain commodity prices.

The Senate version of the Farm Bill contains several unique provisions that will assist dairy farmers including one to refund the premiums paid by producers for a previous version of the Dairy Margin Protection Program.

The ‘Repayment of Premiums’ in Section 1403(g) would compel USDA to return the premiums dairy producers paid to purchase coverage under the Dairy Margin Protection Program (MPP), a risk management tool specifically designed to protect dairy farmers from loss. MPP was not effective and many farmers paid millions of dollars in premiums for a program that never paid out even while milk prices fell 50 percent in three years (2014 – 2017). Returning these premiums to farmers is fair, simple, and can be accomplished quickly with existing mechanisms if this provision is retained in the final Farm Bill. This provision has strong support from dairy producers and farm advocacy organizations.

While there are many issues on which we disagree, I hope that we can find common purpose to assist the American dairy farmer by passing and signing into law a Farm Bill that will treat them fairly and give them the support they deserve. We owe them nothing less. 

Sincerely,

Kirsten Gillibrand

United States Senator