Md. bid to raise milk price may fail

Tentative agreement in Congress would bar state from price co-op


November 17, 1999|By Robert Little | Robert Little,SUN STAFF

A tentative agreement reached by negotiators in Congress would prevent Maryland's dairy farmers from joining a New England pricing cooperative, something they had sought in hopes of getting higher prices for their milk.

But the agreement, which still needs congressional approval, would keep that cooperative alive for another two years. And it would not change milk prices as much as an earlier proposal from the U.S. Department of Agriculture -- a plan that local officials warned could drive many dairy farmers out of business.

"It doesn't look as bad as it could have been," said Michael Wilcom, a Frederick County dairy farmer and chairman of the dairy committee of the Maryland Farm Bureau.

"Maybe there's still a chance we can get in."

Under current federal guidelines, the amount of money paid to farmers for milk is based on where that milk is produced. Farmers essentially get more money the farther they are from Eau Claire, Wis. -- a plan that dates to the 1930s, and was designed to encourage farming beyond the country's dairy heartland.

The U.S. Department of Agriculture is proposing to revise the system, creating fewer geographic pricing regions and generally setting lower prices in the Northeast and the South.

Farmers in Maryland and surrounding states had hoped to join a federally authorized pricing cooperative that allows farmers in six New England states to set prices above the federal minimums. The cooperative can expand to contiguous states. New York and Pennsylvania want to join, making it possible for Maryland to be a member.

The tentative agreement reached by members of Congress yesterday would allow the Northeast Interstate Dairy Compact to continue, but would reportedly freeze its membership. In exchange, negotiators representing Midwestern states have reportedly agreed to a new milk pricing structure that is little changed from the geography-based system already in use.

The agreement was reported in a story yesterday by the Associated Press. Jim O'Connor, an aide to New York Republican Rep. James T. Walsh, called the story "premature, but essentially correct."

"It's not great, but it's better than it might have been," O'Connor said of the agreement.

The USDA's proposal "really only would have helped a handful of states," he said, "and this one, we're confident, should do more to help farmers in the North and elsewhere."

The issue appears far from resolved, however. Senators from Minnesota and Wisconsin have been threatening to tie up the Senate with various delaying tactics, including a filibuster of any legislation that the dairy measures were put into.

"We don't consider this to be a done deal. All holds that we have on legislation remain," said Todd Glass, a spokesman for Sen. Herb Kohl, the Wisconsin Democrat. But supporters of the deal said they have enough votes to break a filibuster.

Consumer groups criticized the proposal yesterday, calling it bad for retail-level prices. The USDA says consumers would save 2 cents a gallon under its plan, while the alternative system would raise prices slightly.

In a letter to congressional leaders, Consumers Union and the Consumer Federation of America said the new proposal would raise milk prices and hit low-income families especially hard.

"This is anti-consumer, special-interest legislation being brought up at the eleventh hour," the letter said.

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