02/10/05 Next year`s budget, Part two

There is no question President Bush's proposed 2006 Fiscal Year budget, announced earlier this week, has caused a significant amount of talk in a variety of areas. For example, many in the agriculture sector expressed concerns about reforming farm support programs. Under the proposed budget, almost $580 million dollars would be saved annually through means such as imposing tighter farm program payments and mandating a five per cent across-the-board cut in direct payments to producers. JOHANNS: They include lowering the payment limit cap for individuals to $250,000 dollars for commodity payments, including all types of marketing loan gains as well as eliminating the three entity rule, basing marketing loans on historical production, reducing crop and dairy payments to farmers by five per cent, acquiring the dairy price support program to minimize expenditures and extending the Milk Income Loss Contract program for two years, and imposing a sugar marketing assessment to be paid by sugar processors on all processed sugar. That's U.D.S.A. Secretary Mike Johanns detailing the cuts at Monday's announcement. Now while many lawmakers say the cuts could lead to a reopening of the 2002 Farm Bill, others like Iowa Senator Chuck Grassley have believed for some time that tighter farm support payments were needed. But while ag received the biggest share of press in terms of cuts, there were other area of concern. And there appears to be none bigger for Northwest lawmakers than the possibility of a new rate system for Bonneville Power Administration. Under the President's proposed budget, B.P.A. would switch from its current rate system based on cost of production, to one based on market prices. That would be a very dramatic switch, and according to news reports, one that could be very dramatic to B.P.A. ratepayer's budgets. Some reports had the projected rate increase resulting from the system switch as high as twenty per cent. And that drew the ire of the Northwest Congressional delegation. Summing up the feelings of many a Northwest lawmaker was Representative Doc Hastings of Washington. HASTINGS: I'm frankly outraged by the proposal to unfairly increase Northwest power rates. This in my view is a tax increase of the worst kind & one that would beat down our regions economy and potentially destroy jobs. So are there positives to the President's budget? Yes. More on that in our next program.