Congress comes back from August recess with a stalled farm bill, an unfinished farmer disaster aid package and a Sept. 30 deadline on surface transportation reauthorization. Layered on top: a proposed Union Pacific–Norfolk Southern merger that would create the first coast-to-coast railroad and won’t be decided until next year.
Hunter Carpenter, ARA’s senior director of public policy, and Richard Gupton, the association’s senior vice president of public policy, joined the Scoop Podcast to sort out what’s likely to move this fall and what ag retailers should be watching. Carpenter covers the farm bill, disaster aid and farm labor; Gupton takes rail, highways and waterways.
Farm Bill
We have House passage of the farm bill — a lot of things included, excluded, what have you. Now we’ve got it with the Senate. Give us a bit of an update. What is ARA watching?
Carpenter: Before the Senate left for August recess, they did try to mark up the Senate farm bill in committee. That did not pass out of committee. They were missing one of their senators on committee. And so they have set another markup and vote for September 15th — so just in a week or so.
We have been watching this and making sure that all of our members’ needs are met. Obviously, a lot of the farm bill priorities that got passed as part of One Big Beautiful Bill last summer touched the budget side, but a lot of the policy issues have yet to be pushed through that we’ve been working on.
We’ll see what happens coming out of committee. Maybe they’ll pre-conference some sort of agreement between the House and the Senate before final passage. But we’re running out of legislative days, so we’re making a push to try and get this done before the end of the month here.
Disaster Aid
We’ve also had a lot of updates and movement around disaster aid payments for farmers — some going back to previous years, some continuing into the present. What are you watching, and what is ARA’s priority in these disaster payments as they’re debated and legislated?
Carpenter: These disaster payments are something that are already a little bit behind on. They’re something that’s sorely needed, right? The ag economy is not doing well, farmers need to stay afloat, and one way that they can do that is through these bridge payments from the federal government.
The House has passed their package, which is actually a billion dollars over what the White House asked for. The Senate has not passed the package yet. We’re hopeful they’ll pass one in September. If they took up the House package, they could go ahead and get it done and get those payments out the door.
We’re hearing rumblings that some senators are seeking an increase from the House’s $12 billion in aid, looking upwards of maybe $17 billion in aid. So it kind of depends on what the Senate’s going to do, as with a lot of things. They’ve got to come to some sort of agreement.
But time is running out. I know that a lot of these members of Congress want to get home to their states and their districts and campaign for those that have elections this year. So it’s something that they need to address sooner rather than later, for sure.
Farm Labor
We’ve also had some movement when it comes to farm labor — an issue that’s multifaceted, but you’ve got at least one string of that thread to pull on here.
Carpenter: There was a ruling in a district court in California last week on the Adverse Effect Wage Rate rules that were written in the Department of Labor last October. They’ve sent that back to Labor and said that they need to rewrite it. We had pushed for some changes to be made for AEWR last year, and we were happy with what the Department of Labor put out.
So now that they’ve put this back in the hands of the department, Congress has the ability to take action on this and codify some of the changes to AEWR. We would like to see that done. And frankly, a lot of the things that need to get done could get done by passing the Securing Ag Workforce Act — that’s G.T. Thompson, the House Ag chairman’s labor bill, that we’re fully supportive of.
We’ve got a Take Action alert out on that. If you want to take action, you can go to ARADC.org, take action, and send a letter to your members of Congress asking them to support that bill. It’s something Congress could fix under their own purview, so we’re pushing for that to get done.
Rail: the UP–Norfolk Southern merger
Richard, I know you watch transportation issues and how they could impact ag retailers’ business very closely. What are the priority issues and updates you’re watching?
Gupton: There’s a lot going on in the transportation space. First and foremost — and it’s probably on everybody’s mind in the ag industry — is the UP–Norfolk Southern proposed merger. The timeline’s been set by the Surface Transportation Board, and we’ve already submitted our notice to participate in that. It doesn’t make you take a position one way or the other, but it protects your right to weigh in during this process.
So we urge our members, and the industry, to supply us with data so we can bring some real-world facts and data to the Surface Transportation Board as they look at this issue.
And how does ARA see the competition question?
Gupton: They have to look at it as enhancing competition. We don’t see these mergers enhancing competition — we actually think it’s the reverse, because they’re going to control nearly 50%, or just under 50%, of the market and be the first coast-to-coast rail line. And so as agricultural shippers, we need competition. Trucking is not a competitor to the rail, and you need reliable service and accountability.
Any kind of rail delay impacts ag retailers, but it also impacts the farm supply chain for their farmer customers. Agriculture works on tight windows, as we know — just-in-time delivery. And so when the transportation system breaks down, those windows don’t wait.
You mentioned rail fuel surcharges. What are you seeing there?
Gupton: If you saw the news about the surplus fuel surcharges — Union Pacific collected $91.1 million above actual fuel costs in quarter two, compared to Norfolk Southern, which was $3.6 million, and CSX at $8.4 million. And these are all reports. So, fairly excessive fuel charges.
Diesel prices and gas prices are impacting consumers, and diesel prices are impacting the ag sector — that’s been reported on. So that’s a big revenue source for UP, for example, and those fuel surcharges impact the bottom line for the ag sector.
Surface Transportation Reauthorization
What’s the outlook on the highway bill?
Gupton: Congress needs to do that by September 30th of this year, which is coming up very fast. That window is likely not to take place. These are for authorizing investment in our surface transportation — highway, roads and bridges — for a five-year timeline.
We have some policy reforms we’re looking for related to the seasonal ag CDL program. There are reforms in the House bill from Congressman Tracey Mann of Kansas, and Senator Jerry Moran of Kansas is working on similar reforms in his bill in the Senate.
The likelihood of that getting done, particularly before September, is very low. Ideally it can be done in what they call the lame duck, because of the election year — they’ll probably be out here shortly. If not, they’re going to have to pass an extension and go into the next Congress, which is not ideal for anyone.
Water Resources Development Act
And the last piece on transportation?
Gupton: The big thing we’re focusing on is the Water Resources Development Act. It’s been reauthorized every two years. It’s the investment in our waterway infrastructure — our inland waterways, which is important for fertilizer movements up north and grain movement out down south.
So we’re supportive of that. There’s bipartisan support in both chambers of Congress. My understanding is there are ongoing pre-conference negotiations, since both chambers have not passed it yet, and so we’re fairly confident that can get done this year, this Congress. It’s been reauthorized on a regular cycle — one of the few things — every two years for the last four Congresses.
On the transportation front, in a nutshell, that’s where we’re focused. But the rail one is really kind of hanging over the industry. We’ll see what happens, and that decision won’t be made until next year.
ARA Conference & Expo
The annual ARA Conference and Expo is coming up in Austin, Texas, December 1st through the 3rd. What highlights do you want to give folks?
Carpenter: We hope everybody listening today will register for the ARA conference. You can do that on our website, ARADC.org. As you said, Austin, Texas, December 1st through the 3rd. We’ll have an expo hall with lots of great presenters, and we welcome all suppliers and retailers to join us.
We’ll have lots of great breakout sessions. I’m moderating one on MAHA and how that’s affecting the ag space, so I’m looking forward to that discussion. Early bird rates do end soon, though, so I’d recommend people register sooner rather than later.
And if you have any young professionals that you want us to recognize at conference, you can nominate them for ARA’s Rising Stars program before September 18th — so that deadline is coming up. You can visit ARADC.org/rising-stars for more information. We’d love to see everybody there in Austin.
