The deal to fund the federal government beyond its current expiration date of December 23, 2022, to September 30, 2023 was released this morning and includes PIA-supported crop insurance provisions, just weeks after PIA crop insurance agents came to Washington, D.C. to promote them.
Throughout the fall, PIA aggressively advocated in favor of the inclusion of crop provisions in the year-end federal government appropriations package, known as an omnibus. The provisions included in the year-end omnibus acknowledge the need for the federal government to right the wrongs that crop insurance agents have faced for years. First, the 2011 Standard Reinsurance Agreement (SRA), which is the contract between the Federal Crop Insurance Corporation (FCIC) and crop insurers, or Approved Insurance Providers (AIPs), established a cap on the administrative and operating (A&O) expense subsidy, applicable in most instances. To make matters worse, beginning in 2016, the U.S. Department of Agriculture’s Risk Management Agency (RMA) stopped making annual inflation adjustments to the total A&O subsidy cap, leaving its value fixed in 2015 dollars, where it remains today.
These actions resulted in effective cuts to agent commissions, during a historically challenging time for crop insurance agents.
PIA-Supported Crop Insurance Language
The provisions included in the omnibus this week begin to address this problem. The omnibus includes an allocation of $25 million in equitable relief for specialty crops. The accompanying report language confirms that the U.S. Department of Agriculture has the legal authority to reinstate the inflation adjustment for all reimbursements and provide equitable relief for specialty crops, all without renegotiating the SRA.
The inclusion of these provisions makes clear Congress’s view that the RMA has the legal authority to provide A&O inflation adjustment reimbursement relief to all crop agents. The $25 million appropriation will provide immediate relief to the specialty crop market, where the effect of ending adjustments for inflation has been severe, and the need for a remedy has been particularly urgent.
Crop insurance agents from PIA affiliates from North Dakota, Nebraska, Kansas, and Minnesota came to Washington, D.C. to ask Congress to include these inflation provisions in the year-end omnibus appropriations package. They met with their elected representatives, congressional committee staff, and the RMA to press their case.
In addition, PIA agents from around the country sent grassroots action messages to their Congressional representatives on the inflation issue. The inclusion of these provisions in the omnibus is a great example of the impact PIA members can have when they advocate for their profession.
Congress must still pass the omnibus by midnight December 23, and it is also possible that the package could be changed before it comes to the floor of each chamber for a vote. After the omnibus text is final, PIA’s work will continue in 2023 to ensure these provisions are fully implemented and, if necessary, urge the 118th Congress to further address the inflation issues in the upcoming Farm Bill negotiations.