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Shutdown or No Shutdown: What Does it All Mean for Agriculture?

September 25, 2015


As Congress begins to recover from Pope Francis’ visit to the Capitol and process House Leader Boehner’s (R-OH) announcement that he will leave Congress in October, it will once again be facing the task of how to fund the government and prevent a shutdown with only days left before the end of the fiscal year.

If Congress does not approve and the President does not sign funding legislation by midnight on September 30, the government will shut down as it did for 16 days in October of 2013.

This is in addition to all the other items Congress must address this fall.

What Will a Shutdown Mean for Agriculture

Without new funding, come October 1 USDA will not be able make new farm and rural development loans, most USDA offices will close, and many crop reports will not be issued impacting farmers and rural communities.

One of the biggest impacts of a shutdown that will be different than the 2013 shutdown is the suspension of Supplemental Nutrition Assistance Program (SNAP) benefits. SNAP funds are transferred each month to the debit cards of eligible households so that they can purchase groceries. During the last shutdown USDA was able to use already appropriated funds to keep the program going during the shutdown.

Those funds are no longer available and the program will be suspended starting October 1 until a new funding bill is signed into law.

Options Being Considered to Fund the Government

On Thursday September 24, a Senate effort to proceed to a Continuing Resolution (CR), funding the government at current levels through December 11 failed to achieve the 60 votes need to advance the bill. The vote failed on a 47-52 vote. The CR contained language to defund Planned Parenthood, which is opposed by Democrats in the Senate.

Immediately following the vote Senate Majority Leader McConnell (R-KY) took action to set up a Monday vote on another CR. This CR does not contain the Planned Parenthood language.  If this vote is successful, the CR could pass the Senate by midweek.

It will then go to the House for consideration, where it is unclear if, the now lame duck, House Majority Leader Boehner (R-OH), will bring up the Senate CR for a vote. The CR likely has the votes to pass, as Democratic leadership has singled they are likely to support a clean CR.  It is too early to tell how Leader Boehner’s (R-OH) announcement will impact discussions on an omnibus, but it does likely improve the prospects of a short term CR.

However, there is a significant caucus of conservatives in the House that are pushing for a government shutdown in order to push the President to the negotiating table on the Planned Parenthood funding issue. Earlier this week, a group of 11 freshman Republican House members sent a letter to House leaderships opposing a shutdown, so it is unclear what will happen if and when a CR reaches the House for consideration.  While it is unclear when leadership elections will take place, they could complicate discussions on an end of year omnibus.

What if the CR Passes?

If a CR through December 11 is passed and signed into law by the President, Congress will have about two months to negotiate an omnibus appropriations bill to fund the government through the end of Fiscal Year 2016. An omnibus stitches all 12 appropriations bills together in one big package.

Many would like the omnibus to take the form of a “grand bargain” similar to the 2013 Murray-Ryan deal, which raised spending caps established by the Budget Control act in 2011, allowing both non-defense and defense discretionary funding to increase.

While negotiations over a grand bargain are being discussed in the press, there is no sign of any real discussions having started. Once the short-term CR is in place, however, the hope is that things will finally get serious.

If there is a grand bargain, or even if there is not, the stated goal of a two month CR is to allow time to negotiate a year-end omnibus appropriations bill. If there is not a omnibus, putting government programs on autopilot with a full year CR is the most likely alternative.

The hoped-for grand bargain will be very complicated, potentially including a highway bill extension, extensions of other expired or expiring laws and tax provisions (possibly including the Child Nutrition Act reauthorization), and raising the national debt ceiling. But for appropriations purposes, the basic contour of the bargain is clear – finding an agreement to increase both defense and domestic social spending by $30-40 billion above the spending caps established in 2011, bringing spending levels in real dollars back closer to where they were a decade ago.

What’s is the CR’s impact on Agriculture?

While CRs generally simply extend all government funding at current levels, they can contain “anomalies.” These are provisions that are added for one reason or another to change policy, increase or decrease funding for specific accounts, and extend expiring programs.

In the case of the CR being considered by the Senate, there are a few anomalies impacting USDA:

Section 109: Impacts all government agencies and has the effect of limiting the number of loans that FSA can issue during the duration of the CR. NSAC opposes this provision being included in the CR because the fall and winter is when most farmers need loans to prepare for the next season.

Section 116: Increases funding for the Commodity Supplemental Food Program to cover higher food package costs.

Section 135: Appropriates $700 million in emergency funding for wildfire suppression activates and to refund other Forest Service accounts already raided to pay for firefighting activities.

Conclusion

NSAC supports efforts to prevent a shutdown with a short term CR. We hope that the CR that eventually passes stripes out the Section 109 provision.  Congress should then expeditiously move to negotiate an Omnibus that includes the NSAC supported provisions of the House and Senate Appropriations Committee passed agricultural funding bills.


Categories: Budget and Appropriations, General Interest, Grants and Programs


2 responses to “Shutdown or No Shutdown: What Does it All Mean for Agriculture?”

  1. […] would a government shutdown mean for U.S. agriculture? This blog post from the National Sustainable Agriculture Council (NSAC) discusses the very real impacts. Among them? The suspension of Supplemental Nutrition […]

  2. Crystal says:

    Thanks for these updates! We serve meals at our local soup kitchen. This helps us plan that there may be far more next month. We are also in process for an FSA loan, so it helps us plan for possible delays.

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