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Fiscal cliff deal avoids milk price increase, leaves questions about Fort Drum spending

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WATERTOWN - With Congress moving legislation through to avert the fiscal cliff, Congressional representatives are giving the deal mixed reviews in terms of helping local dairy farmers and creating stability for Fort Drum funding.

Congress avoided the so-called “dairy cliff” by approving a nine-month extension of the current farm bill approved in 2008. Without the extension, milk prices could have risen to more than $6 a gallon, as the government would have been forced to buy milk from farmers at prices set in 1949.

Rep. William L. Owens, D-Plattsburgh, said he was dissatisfied with the limited extension of the farm bill, and that he wouldn’t have voted for it as a standalone bill. He blamed the delay on voting on the farm bill on Republican leadership within the House of Representatives, Speaker John A. Boehner and Majority Leader Eric I. Cantor, who he said could not have sufficient votes to pass the measure without votes from Democrats.

“I’m extremely frustrated by the fact that Mr. Boehner and Mr. Cantor promised it would be voted on after the election and reneged,” Mr. Owens said. “They refused to vote on it on the House floor because they knew it was going to be passed” with votes from Democrats.

While the passage of the extension will provide some certainty for dairy farmers who had been waiting months for Congressional action, Mr. Owens said funding for the Milk Income Loss Contract, which expired on Sept. 30, has been reduced in the extension. The program allows the government to buy milk from farmers when prices fall below a federally set level pegged to the cost of production.

Mr. Owens said it may be several months before the margin insurance program, which allows enrolled farmers to be reimbursed based on gaps between production and milk costs, will be reintroduced and voted on.

“I don’t think we have any assurance they’ll do that, and it could be a very frustrating second year for this farm bill,” Mr. Owens said.

The extension will also continue a $5 billion program that provides direct payments to provide assistance to commodity farmers, which would have been cut by the farm bill proposed earlier in 2012. Mr. Owens called that program wasteful spending, and something that could have been a part of an overall deficit reduction program. He said the Senate version of the bill would have cut $2.3 million per year from the program, while the House version would have saved $3.2 billion.

Despite some reservations about the extension, its passage was deemed as a positive by the state’s senators.

Sen. Charles E. Schumer, in a statement released Wednesday, said if the extension had not passed, it would have created an unnecessary burden on families, schools and farmers.

“The ‘dairy cliff’ would have meant chaos for family farmers and sticker shock throughout New York’s supermarkets, with the doubling of milk prices,” he said.

Sen. Kirsten E. Gillibrand, in a statement, called the inability to pass a new bill another sign of “Congressional dysfunction.”

“An extension is better than nothing, but the status quo is unacceptable. I hope to work with the Committee to develop a new bill that will provide stability and transparency for New York farmers,” she said.

At Fort Drum, the deal agreed to by lawmakers, which pushes back decisions on most spending cuts for two months, leaves many questions about what kind of reductions will be determined for defense spending, and how that will affect the post.

One group that could see cuts are civilian employees and contractors.

Carl A. McLaughlin, executive director of the Fort Drum Regional Liaison Organization, said that since many of the civilian jobs on post paid well, cuts to those positions would present a “serious problem” for the north country.

“Anything we lose there hurts,” he said.

The post’s last economic impact study, released in April, listed the post as having 4,614 civilian workers in fiscal year 2011 with a combined payroll of $204,183,368.

F. Anthony Keating, civilian aide to the secretary of the Army, said he had struggled to understand what the deal would mean for Fort Drum. He speculated that while the post may not be as badly affected as other installations, “there’s no way we’re going to completely dodge the bullet.”

He said cuts to civilian jobs on post would be just as bad to the area as if troop levels were reduced.

Mr. Owens said he was concerned that the area could get hit twice as companies lose business on post, and in turn reduce employees.

“That’s why we have to work very hard over the next 60 days, so that kind of thing doesn’t happen,” he said.

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