News briefs – September, 2009
Comments requested on climate change bill
Guest Opinion: Who’s a farmer?
Comments requested on climate change bill
Electric co-op members across the country are being asked to contact elected officials in Washington, D.C., about proposed legislation that would limit emissions of greenhouse gases blamed for global warming.
Electric co-ops in Kentucky have especially criticized the plan for heavily penalizing the use of coal, which is used to generate nearly all the electricity in the state. The result of the bill, say the co-ops, would be dramatic increases in the cost of electricity, especially in Kentucky.
At issue is a bill passed by the U.S. House of Representatives in June on a close 219 to 212 vote. The proposal is now being considered by the Senate, which could pass it and send it to President Obama to be signed into law. If the Senate makes major changes to the bill that passed the House, the measure would go to a joint conference committee to work out the differences.
The bill sets limits on greenhouse gas emissions by requiring electric utilities to sharply increase the use of energy efficiency and renewable energy, beginning in the year 2012. If the utilities can’t meet those limits, they can buy emissions allowances from other utilities that don’t emit as much greenhouse gas.
The practical result of this complex “cap and trade” system would be to push utilities in Kentucky and other coal-dependent states, to purchase credits from other parts of the country, like the West Coast, where nuclear and hydroelectric power fuel a larger share of the electricity.
That’s not fair, says the National Rural Electric Cooperative Association, which opposes rules that would significantly raise electric rates based on where people live. In urging co-op members to contact their elected officials, NRECA said that global warming goals could be achieved without huge cost increases, if Congress would work with electric co-ops to fix the problems in the proposed legislation.
As the debate shapes up in the Senate this fall, NRECA suggested co-op members ask their senators to fight for a bill that is:
“Fair—Climate change legislation needs to recognize regional differences in how electricity is produced. I should not be penalized because of where I live.
“Affordable—Any climate change plan must keep electric bills affordable for all Americans.
“Achievable—Climate change mandates must be realistic to ensure long-term success.”
If you would like to register your opinion on the bill with Senator Jim Bunning or Senator Mitch McConnell, you can find out how to contact them by going to www.kaec.org and click on “Contact Your Legislators.” If you want to refer to the bill covered in this article, it’s known as the “Waxman-Markey” bill (it was introduced by Rep. Henry Waxman of California and Rep. Edward Markey of Massachusetts), and goes by the number H.R. 2454.
The Appalachian Artisan Center in Hindman wants to borrow pottery made by local potter Mike Ware for an exhibit highlighting his ceramics and photographs. The Center needs the items by September 28 for the show that runs October through December. For info contact the Center at (606) 785-9855 or visit their Web site at www.artisancenter.net.
Guest Opinion: Who’s a farmer?
by Craig Infanger
The most recent Agricultural Census reveals that in 2007 we had 85,260 farms in Kentucky, down 1 percent from 2002. That ranks Kentucky fifth, behind Texas, Missouri, Iowa, and Oklahoma. The average Kentucky farm was 164 acres and had $56,586 in market value of production.
How farms are defined has rural policy implications. The current definition of a farm was first used in the 1974 Census of Agriculture. A farm for census purposes is any place that has (or normally would have) $1,000 or more in gross sales of farm products a year.
The Ag Census definition of a farm has little functional economic meaning. It is a technical term agreed to by the Office of Management and Budget, the Census Bureau, and U.S. Department of Agriculture.
If you consider a farm to be an economic enterprise where land, labor, capital, and management are used to produce a financial return, then you should logically look for farms with the potential to utilize these resources to produce incomes above the poverty level. The current federal guideline for the poverty level of income for a family of four is $22,050. So, it might be useful to ask: “What is the minimum size of a farm in Kentucky that would produce incomes above the poverty line?”
From a farm management point of view, if you can keep production expenses to 80 percent or less of total sales, you are in the “green zone” of financial viability. Thus, only those farms with sales substantially greater than $100,000 and are being managed reasonably well, have the potential to generate family income above the poverty level.
Under that definition of a farm, the Ag Census shows 5,922 farms in Kentucky—those with total sales of $100,000 or more. However, it is probably more realistic to think of Kentucky’s core “commercial farms” as those with sales of $250,000 and more. If we use this definition, we have 3,030 farms in Kentucky. This group accounted for 74 percent of Kentucky’s $4.8 billion of farm production sales in 2007.
Of course, there are far more than 5,922 people in Kentucky who consider themselves farmers. These smaller farms are important and spread all across the state. USDA has terminology like “limited resource farms” or “residential lifestyle farms” that might be used to describe the bulk of Kentucky farms (79,338). For these farms, rural economic policy is far more important than farm programs because these farms are highly dependent on off-farm income. In 2007, 35,148 of the principal operators on Kentucky farms worked 200 days or more off the farm—essentially full-time. Jobs in rural areas, health care, education, and rural infrastructure are far more important to these farms than farm policies.
Craig Infanger is Extension professor and director of Undergraduate Studies for Agricultural Economics, University of Kentucky College of Agriculture.
An electric co-op based in Grayson wants to create a license plate that will honor linemen and raise money for line worker training. For the “lineman design” license plate to become a reality on cars in the state, Grayson Rural Electric Co-op needs 900 people to agree to purchase a plate with a signature and a check for $25. When 900 paid applications are received, the Kentucky clerk’s office will notify applicants when the plates are ready to be picked up. Five dollars from each plate will be donated to Kentucky Community & Technical College System’s lineman’s training schools. You can find information and an application form at www.graysonrecc.com or call the co-op at (606) 475-2191.
