Legislation Would Close Crop Insurance Yield Substitution Loophole Nationwide
Washington, D.C. - Colorado U.S. Senator Michael Bennet, along with Senators John Thune (R-SD), Amy Klobuchar (D-MN), and Mike Rounds (R-SD), and Representatives Kristi Noem (R-SD) and Tim Walz (D-MN), last week introduced companion versions of the bipartisan American Prairie Conservation Act.
This new sodsaver legislation would close a crop yield substitution loophole in all 50 states, which would eliminate an incentive to convert native sod to cropland. According to the Congressional Budget Office, the legislation would save more than $50 million over ten years.
"As we look to the next Farm Bill, we should carefully consider where we are spending federal dollars," Bennet said. "Expanding sodsaver nationwide would ensure federal crop insurance investments are spent on the most productive farmland. By limiting incentives to break up native sod, we can conserve prairie habitat and support the wildlife and communities that depend on these landscapes."
Bennet first introduced a natiowide sodsaver bill in 2013, and the 2014 Farm Bill implemented sodsaver in six midwestern states.
Sodsaver is a cost-saving initiative that eliminates an incentive, but does not prevent farmers from converting native sod to cropland. Farmers who choose to break up native sod and convert it to cropland face a reduction in their crop insurance premium subsidy assistance and a reduction in guaranteed yields of insured crops.
However, a loophole in the existing sodsaver statute allows producers to plant non-insurable crops on newly-converted native sod for four successive years. After the four successive-year window, producers could then plant insurable crops, such as corn, wheat, and soybeans, without any reduction in crop insurance assistance. The American Prairie Conservation Act would require four cumulative years of crop insurance assistance reductions before insurable crops planted on native sod that are converted to cropland are no longer subject to sodsaver provisions.