A proposal that would offer grants for farmers whose insurance did not fully cover their crop losses cleared a South Carolian House budget panel Thursday.
House budget chairman State Rep. Brian White, R-Anderson, is pushing legislation that would offer grants to those farmers — particularly in the Midlands and Pee Dee — who suffered nearly total losses of their harvest following record rainfall in October. State agriculture officials say the agriculture industry statewide suffered more than $375 million in damaged crops or fields that could not be harvested due to the unprecedented weather.
“What we’re interested in doing is not having an industry totally go away,” he said during a Ways and Means Committee subcommittee hearing. “We’d try to give a helping hand to the farmers, but not restoring profits, not giving 100% bailouts. There’s no way we could afford to do that.”
White’s bill would create a statewide Farm Aid Board to review the cases of farmers and approve grants that could assist in next year’s planting. The board would award grants of up to 20 percent of their total documented losses, up to $100,000. No dollar figure is attached to the bill at this time, but White said he’d like for legislators to use a contingency reserve fund that includes roughly $87 million in surplus funds from the past budget year in order to get the funds immediately instead of waiting for the full budget in June. The chairman said there could also be emergency federal grants available through a federal budget provision that passed last month
Gov. Nikki Haley opposes making cash payments to underinsured farmers, however, arguing they should not be treated any differently from other South Carolina businesses affected by the record rainfall.
Farmers who testified before the vote Thursday argue the nature of crop insurance itself practically guaranteed they could not afford enough insurance. Most crop insurance programs reimburse farmers based on a percentage of the commodity price for their damaged crops. However, Dean Hutto of R. Barry Hutto Farm in Holly Hill said the cotton commodity prices were extremely low this year and the insurance will not come close to covering his losses.
He said many farms are being forced to shut down this upcoming season, as even three months later some farms are still unusable. “How do we overcome a $400,000 loss, even after insurance, on our farms?” he asked the panel. “And the answer for some is: you don’t. There are some of my neighbors who are not flooding in 2016. You don’t overcome a thousand-year flood without some form of government intervention.”
State Agriculture Commissioner Hugh Weathers said the proposed bill would not be a bailout for farmers, but is meant to simply help them survive financially. “No farmer by passage of this bill will be made whole,” he said. “It will bridge that farmer’s operations hopefully to 2016. Hopefully, this year will be one in which Mother Nature treats us kindly.”
One member of the panel, State Rep. Kenny Bingham, R-Cayce, was hesitant to support the idea and abstained from voting. Bingham said he has concerns about using state resources to favor one set of victims over another. “Whatever we do should not be for the loudest voice or the biggest voice. It’s to be fair and balanced with every citizen across the state,” he argued. “I’ve got folks in my district who lost their homes and don’t have any insurance.”
The bill now heads to the full House Ways & Means Committee, where it is expected to be approved. White said he hopes to have a cost estimate by the time the bill reaches the House floor in a few weeks.