On July 12, 2017, the House Appropriations Committee advanced their agriculture appropriations funding measure for fiscal year (FY) 2018, which was drafted originally by the House Agriculture Appropriations Subcommittee. This appropriations bill funds the major programs and functions of the US Department of Agriculture (USDA), the Commodity Future Trading Commission (CFTC), and the Food and Drug Administration (FDA). When writing the bill, the Agriculture Appropriations Subcommittee assumed an overall discretionary spending cap of $20 billion, which is $876 million less than it had in the FY 2017 Omnibus. As a result, the initial Subcommittee bill made cuts to a variety of program across multiple USDA agencies. During the full Appropriations Committee’s consideration of the bill yesterday, Subcommittee Chairman Robert Aderholt (R-AL) agreed to reverse a number of those cuts, while several members of the Committee spoke out against other cuts that were not reversed.

The National Sustainable Agriculture Coalition (NSAC) commends Representative Chellie Pingree (D-ME) for speaking against cuts to the Farm Service Agency’s (FSA) Direct Operating Loan program, and both Representatives Pingree (D-ME) and David Young (R-IA) for opposing the deep cuts made to the Rural Energy for America Program (REAP). We also thank Chairman Robert Aderholt (R-AL) for his commitment (in response to to Representative Young) that he and the Committee would continue working to address cuts to mandatory funding for farm bill energy programs.

As always, NSAC is committed to working with our champions on both the House and Senate Appropriations Committees to protect and strengthen programs and policies that help family farmers, their businesses, and rural communities thrive.

To see a full breakdown of the House Agriculture Appropriation Subcommittee’s original bill, please see our previous blog post. Most of the bill remains unchanged since the original version was released two weeks ago.

The Managers Amendment – Farm Service Agency (FSA) Guaranteed Operating Loan Program

During the legislating process, the “manager” of a bill, in this case Subcommittee Chairman Aderholt, has the option to make changes to a bill after introduction but ahead of consideration of that bill. Those changes are typically packaged into what is known as a “manager’s amendment.”

As a result of the hard work and tenacity of Congresswoman Pingree, who spoke with Chairman Aderholt ahead of markup, the manager’s amendment during yesterday’s debate included a provision to increase funding for the FSA Guaranteed Operating Loan program by $190 million, to $1.58 billion. We thank Representative Pingree as well as all the members who signed onto a letter championed by Representatives John Faso (R-NY) and Ron Kind (D-WI) in support of increased funding for FSA loan programs. Even with this increase in funding, however, the FSA Guaranteed Operating Loan program’s funding falls far short of the $1.96 billion included in the FY 2017 Omnibus.

The FSA Guaranteed Operating loan program provides loan guarantees of 85-95 percent to private banks to provide operating loans to farmers. This program includes set-asides for beginning and socially disadvantaged farmers, though banks have never fully utilized these set-asides.

We continue to be concerned about, and will work to reverse, significant cuts to two other FSA loan programs retained in the bill. FSA Direct Operating Loan funding levels remain $226 million below FY 2017 levels and FSA Guaranteed Farm Ownership Loan funding reimains $250 million below FY 2017 levels.  FSA Direct Operating loans are especially critical because of the downturn in the farm economy. They were the first type of loan to run out of funding in FY 2016 and are particularly important for beginning farmers and ranchers. In order to qualify, farmers have to have been turned down for other loans, so they have nowhere else to turn.

The Managers Amendment – Health Food Financing Initiative (HFFI)

The manager’s amendment, at the request of Representative Barbara Lee (D-CA), also contained a provision to provide $1 million in FY 2018 for HFFI. The Subcommittee’s bill had not included any funding for HFFI. If included in final appropriations legislation, this funding would support market planning and promotion and infrastructure development to increase the availability of retail outlets in food deserts. It could also potentially be used to increase the delivery of locally and regionally produced foods. Until FY 2017, all HFFI funding had been provided by the Treasury Department and the Department of Health and Human Services. The FY 2107 Omnibus included $1 million to start-up HFFI activities within USDA, which was the first time that the USDA portion received funding.

Other Manager’s Amendment Provisions

In addition to the increases listed above, the manager’s amendment also contained a troubling cut to mandatory funding for a key farm bill program. The additional cut (on top of a 82 percent cut already included in the initial Subcommittee bill) of $8 million to REAP leaves the program with just $1 million of the $50 million in mandatory funding provided by the 2014 Farm Bill. In gutting REAP, the Committee is undermining USDA’s primary tool for helping farmers and ranchers reduce energy costs by conserving and producing energy on their land.

Other Amendments

Potential amendments on the Grain Inspectors, Packers, and Stockyards Administration (GIPSA) and organic animal welfare rules did not materialize this year. Amendments on e-cigarettes, compounding of drugs, and horse slaughter consumed the bulk of the debate. Each of these amendments were either defeated or withdrawn. An amendment on USDA’s sugar programs was offered and withdrawn with little debate.

One notable amendment that did pass was one offered by Representative Dan Newhouse (R-WA) to allow workers brought to the United States on H2A visas for agriculture work to stay in housing built using funding from a USDA migrant worker housing loan program. Currently, housing built using the Section 514 loan program cannot be used to house foreign farm workers.

Takeaways from the Committee Report

In our last blog covering the House Agriculture Appropriations Subcommittee markup of the FY 2018 Agriculture Appropriations bill, we did not yet have access to the full report accompanying the bill. This report specifies certain funding levels and contains important directions to USDA about how to implement the Committee’s objectives. The Committee report:

• Directs USDA to treat the conservation mission and the farm production mission equally under the new consolidated Farm Production and Conservation Mission Area;
• Encourages USDA to cost-share the installation of saturated buffers in new, re-enrolled and existing Conservation Reserve Program contracts;
• Encourages USDA to retain and fulfill farm loan program officer positions to facilitate an orderly processing of applications and prevent administrative backlogs;
• Encourages USDA’s Food and Nutrition Service to assist farmers markets and direct-selling farmers in obtaining electronic benefits transfer (EBT) equipment that accepts both Supplemental Nutrition Assistance Program benefits and Women, Infants, and Children Program benefits; and
• Encourages USDA’s Agriculture and Food Research Initiative to do more to address the needs of organic agriculture.

Next Steps

The House Agriculture Appropriations bill is now able to go to the House floor for consideration by the full House, though it is not at all clear when or even if that will happen. If a stand-alone bill does not go to the House floor, it will likely be wrapped into a larger Omnibus funding package that includes multiple appropriations bills later in the year.

We expect the Senate Agriculture Appropriations Subcommittee to debate and vote on its own agriculture appropriations bill in the coming weeks. Once that happens, negotiations will ramp up between agriculture appropriators in the House and Senate. We will continue to monitor and report on the process as it moves forward, so stay tuned.

For a full breakdown of the current funding situation, download our updated annual appropriations chart here.