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Farm bill sent to president; Klobuchar, Coleman praise $290 billion package

The new five-year farm bill headed to President Bush's desk Thursday contains many Minnesota-written provisions, especially in promoting renewable fuels.

The bill achieved veto-proof margins in both chambers, which will be needed as Bush said he will veto the bill.

The $290 billion farm bill includes $1 billion for renewable fuels research and credits, hoping to trigger the next wave of biofuels made from sugar beets and crop residue, switch grass and logging waste -- all of which benefit northern Minnesota.

"Something I worked very hard on is the energy provision ... which is to help us transition to the next generation of biofuels by offering farmers incentives to grow dedicated energy crops like switch grass and prairie grass, which can be used for cellulostic ethanol," U.S. Sen. Amy Klobuchar, DFL-Minn., said in a telephone interview Thursday.

U.S. Sen. Norm Coleman, R-Minn., would add sugar to that ethanol list, especially sugar beets from the Red River Valley. Since the Central American Free Trade Agreement allowed cheaper Mexican and Caribbean sugar cane to hit U.S. markets, Coleman has been seeking another use for sugar beets.

"This bill provides the funding for the next step, to move to cellulostic ethanol, to biofuels that are beyond what we do today," Coleman said Thursday in a telephone news conference with Minnesota reporters.

"It also supports sugar ethanol," he added. "I take personal pride in this because I raised this issue a couple of years ago and got a lot of push-back. Folks said it couldn't be done."

Brazil today isn't dependent upon foreign oil, getting most of its fuel from sugar ethanol, the Minnesota Republican said. "They aren't be held hostage as we are."

Including sugar ethanol in the farm bill "was the right thing," Coleman said. "Sometimes it just takes a while for folks to kind of see what the future is. ... Sometimes you have to convince people that you can see what's on the other side of the mountain."

Coleman said the farm bill also extends the government's program on sugar, as Minnesota's sugar beet farmers will receive an increase in the sugar loan rate, or guaranteed minimum price for sugar growers, from 18 cents a pound to 18.75 cents -- the first of its kind in over 15 years.

The sugar ethanol program Coleman pursued in order to take excess sugar from trade agreements and use it to help cut foreign oil dependence. Once implemented, the plan will help America move quickly to diversify our ethanol feedstocks, he said. The sugar beet industry provides more than $2 billion a year to Minnesota's economy and sustains nearly 40,000 jobs.

It's a direction the nation needs to move, agreed Klobuchar.

"This really is the future," she said. "We're going to truly be energy independent with a combination of hybrids and biofuels. We're going to have to build to this next generation of biofuels. It can be residue from logging, it can be the switch grass/prairie grass."

Northern Minnesota will benefit, she added.

"We can move as quickly as we can get the research done," Klobuchar said of ethanol production using biofuels other than corn, which has now put pressure on feedstocks and the food supply.

"I'm hoping that in just a few years we'll be able to start doing this, probably starting with corn stover because a lot of the existing ethanol plants can be transformed to take other parts of the corn," Klobuchar said.

The University of Minnesota is doing research on the next step, that of cellulostic ethanol, she said.

"The value for northern Minnesota is that the next stage of ethanol will involve all kinds of different things, including the residue from logging," Klobuchar said. "So that will be very good for northern Minnesota, as well as the sugar beets."

The idea is to use domestically grown renewables to make fuel, cutting dependence on foreign oil, said Coleman.

"One of the greatest threats we face is our addiction to foreign oil," Coleman said. "We need a Manhattan Project to end that dependency. We need to get that needle out of our arm and stop sending $500 billion a year out of this country and into the pockets of thugs and tyrants like (Hugo) Chavez and (Mahmoud) Ahmadinejad."

Coleman also lauded other provisions he aided in the farm bill, such as increased funding for food banks and emergency shelters, loans to farmers to build and upgrade grain storage facilities, measures to encourage local ownership of biorefineries, and in preserving the safety net for farmers.

"People think commodity prices are high and that it's good times on the farm," Coleman said. "They forget that it comes and goes. A couple of years ago we had people in great distress. And that's why you need a safety net. That's why this farm bill is so important."

The farm bill is also important to Minnesota's dairy industry, said DFLer Klobuchar.

"We were able to restore the milk payment rate back to 45 percent," she said. The Milk Income Loss Contract program is extended through the life of the farm bill and increases the payment rate back to 45 percent from the current 34 percent level. And the bill will adjust the price trigger up when feed prices increase.

Klobuchar was also a leader in trying to cap direct subsidy payments to farmers and non-farmers, which now will seek income caps of $750,000 for farmers and $500,000 for non-farmers over which they would be ineligible for direct payments.

"We tried to get that these art collectors from San Francisco and real estate developers from Florida from getting farm payments," she said. "There was some movement from the Senate bill, so I was excited about that."

She also hailed Country-of-Origin-Labeling provisions, which until now only applied to seafood. "Now people won't just ask where's the beef," Klobuchar said, "they can ask where's the beef from."

Both Coleman and Klobuchar said the bill includes a new permanent disaster fund, set at $3.8 billion, which will also benefit Minnesota farmers caught between drought and flood.

In other Minnesota reaction Thursday, Kevin Paap, Minnesota Farm Bureau Federation president, said that "passage of this critical piece of legislation has been long awaited by farmers across Minnesota and the United States. However, we are only part way to the finish line.

"We are disappointed that the president has threatened to veto the farm bill," Paap said. "The vote count in both bodies is an indication of strong bipartisan support for this bill. We encourage Minnesota's members of Congress and the Senate who voted yes to do so again to override the president's veto and ensure that the 2008 Farm Bill becomes law."

The bill, Paap said, "continues to provide the essential safety net for farmers and allows them to continue to produce food, fuel and fiber for consumers around the world. In addition, all consumers, rural, suburban and urban, reap the benefits of this bipartisan bill that increases support of the environment and programs to aide the hungry."