This week, I organized a rally in LeRoy to bring attention to the urgent need for our state to invest in our dairy industry. With milk prices low and costs at an all-time high, if the state does not intervene immediately, we are looking at losing this vital component of our agricultural industry.
Right now, New York States dairy industry is one of the leading dairy industries in the nation. In addition to dairy farms, dairy production has skyrocketed across our state, leading the way in terms of new products and packaging. New Yorks dairy truly exemplifies the pride of New York and contributes around $2.4 billion to our states annual economy. If dairy farms close, not only does our rural economy collapse, but the landscape of our region will forever be changed.
Specifically, I have joined with dairy farmers and organizations and other elected officials to call on the Governor to invest $150 million in the Dairy Assistance Program. Half of this money would go to farmers immediately, the other half would be appropriated in the 2010-11 fiscal year. The appropriations would be funded through the American Recovery and Reinvestment stimulus money, which our state has a surplus $1 billion left unappropriated.
In 2008, as a member of the Assembly Agriculture Committee, I helped to deliver $80 million for this program; however, now that energy and transportation costs have risen again, dairy farmers are in need again. With federal stimulus dollars already in hand and unused, there is no reason why our state shouldnt use these dollars in the exact way they were intended: to assist our economy during these tough economic times. Here in Western New York, agriculture is the backbone of our economy and I firmly believe that our rural economy deserves the same support given to failed Wall Street companies, like AIG.
Additionally, I testified at a United States Senate Hearing, held recently in Batavia, on this vital issue. Not only did I call on our federal government to encourage the Governor to appropriate the federal stimulus dollars, but I also called on them to increase the Milk Income Loss Contract (MILC) payments in order to help give dairy farmers more stable ground on which to produce milk and dairy products.
As a former family farmer with knowledge of this industry, I understand that MILC payment rates should be based not on the feed costs in the Midwest, but the feed costs here in New York State, or at least prices in the Northeast. Thats why I also asked federal officials to permanently reform MILC to reflect the higher costs in the Northeast, if not by creating a New York State specific price index itself.
There is no question that the current dairy crisis needs to be addressed immediately. Yet, our state and federal governments should enact meaningful reforms to programs like MILC in order to set up a long-term solution for this vital industry.