By a vote of 400-20, the U.S. House on Wednesday passed legislation by Rep. Vern Buchanan of Sarasota that would give tax breaks to citrus grove investors for replacing plants damaged by “citrus greening,” an incurable bacterial disease that has swept through nearly all of Florida’s commercial citrus groves.
The “Emergency Citrus Disease Response Act,” H.R. 3957, would amend the tax code to allow minority citrus grove investors – who don’t materially participate in the business – to deduct the costs of replanting crops damaged by the disease in the same year that the costs are incurred.
Current law allows only minority investors who take part in planting and related activities to immediately deduct the costs of replacing damaged crops rather than spreading them out over several years.
Farm investors can include local banks, credit unions and private investors. The new legislation would also allow an individual who bought an entire property in order to replant lost or damaged citrus plants to take the same expedited deduction.
By reducing tax revenues, the Joint Committee on Taxation estimates the legislation would increase the federal budget deficit by $30 million over 10 years.
Known as “yellow dragon disease,” citrus greening first hit Florida in 2005. Experts say the disease could cause a 26 percent decline in Florida’s commercial orange crop this year.
A 2012 study by the University of Florida estimates that citrus greening has cost the state more than $4 billion and eliminated some 8,000 jobs. Those numbers have since doubled, according to Florida Citrus Mutual, a trade association.
Growers like Mark Wheeler of Manatee County must pay an average of $2,000 per acre to replace plants stricken by the disease.
“The Emergency Citrus Disease Response Act will provide a significant incentive to put more trees in the ground by counterbalancing my upfront costs,” Wheeler said in a statement. “And when it becomes law I plan to take advantage of the benefits and I know other growers will too.”
In a statement on Wednesday, Buchanan, a Republican, said the bill “will go a long way toward protecting the livelihoods” of 62,000 citrus-industry workers in Florida.
“The story of American agriculture is one of resilience and hard work against tremendous odds,” Buchanan’s statement said. “Citrus farmers are being hit hard and Congress needs to help them recover.”
Florida’s entire 29-member congressional delegation supports Buchanan’s bill, which unanimously passed the House Ways and Means Committee last week.
Companion legislation in the Senate has been introduced by Florida’s Democratic Senator Bill Nelson. Buchanan is hopeful the Senate will take up the legislation next week.
“The Senate now needs to act swiftly to get this bill to the president’s desk,” Buchanan wrote.