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Senate Prepares to Debate New Farm Bill Proposal in Context of Sequestration Bill

February 27, 2013

Wednesday night update to original post:

Late Wednesday, Senate Republicans coalesced around the package they will offer on the Senate floor on Thursday.  Their plan would leave the $85 billion in total budget cuts in place, but instead of requiring across-the-board cuts via the sequester, they propose to give President Obama until March 15 to design a plan that exempts some budget accounts from cuts while doubling down on others.  Both houses of Congress could vote to override the President’s plan under the GOP proposal, but to do so would require a two-thirds vote.  Unlike the Democratic plan, the GOP plan would not address the Farm Bill.

Also late Wednesday night, the Congressional Budget Office (CBO) released their scoring of the Democratic bill sponsored by Senator Mikulski (see details in original post below).  According to CBO, the bill would cut defense spending by $26.8 billion and cut farm bill spending by $27.8 billion, over the next decade, while also increasing tax revenue by $55 billion.

The CBO analysis pegs the farm bill cut stemming from the automatic budget cuts (sequestration) at $6.025 billion over the next decade.  NSAC had previously estimated those cuts at under $7 billion.

The CBO score reveals a net savings from terminating direct payments and funding the programs stranded by the fiscal cliff farm bill extension at $30.6 billion.  They estimate the re-instatement of the permanent disaster program known as SURE at $2.8 billion and the cost of disaster assistance for fruit producers at $105 million.  Those numbers are somewhat different than the ones in the original post below, but yield roughly the same net savings.

Original Post:

The Senate is debating this week approaches to stave off the looming across-the-board budget cuts known as sequestration.  The Democratic package includes a major Farm Bill proposal, including restoring needed funding for a host of sustainable agriculture programs.

Senate Democrats have united around a bill to cut the deficit by $110 billion through targeted spending cuts and revenue increases while postponing sequestration.  The automatic cuts otherwise go into effect this Friday, March 1.

In addition to the Democratic-sponsored measure, the Senate will also debate a Republican proposal, the details of which have not yet been revealed.  Unlike the Democratic measure, the Republican bill is not expected to deal with Farm Bill issues.

Votes on both proposals are expected Thursday.  Neither measure is expected to receive enough votes to reach the 60-vote super majority threshold required to end Senate filibusters.  However, both proposals could become important as Congress negotiates a bill over the next several weeks to fund the government after March 27 and avoid a government shutdown.

The bill just introduced by Senate Appropriations Chair Barbara Mikulski (D-MD), Budget Committee Chair Patty Murray (D-WA), and Majority Leader Harry Reid (D-NV) would postpone the automatic across-the-board spending cuts (including $85 billion in cuts in 2013) until next year.  The bill would replace the immediate automatic cuts with $110 billion in deficit reduction gained by raising $55 billion through closing tax loopholes and reducing spending $55 billion.  On the spending side, half of the savings would come from defense spending and the other half from the Farm Bill.

The Farm Bill portion of the bill does four things:

  • Removes Farm Bill spending from inclusion in the automatic spending cuts (sequestration), which otherwise will cut both commodity payments and conservation programs each year for the next nine years.
  • Terminates the out-of-date direct payment commodity production subsidy program, raising $31 billion.
  • Reinvests $3.5 billion of the $31 billion saved to restore funding to Farm Bill programs that were left stranded when Congress passed a nine-month extension of the the 2008 Farm Bill as part of the fiscal cliff deal.
  • Fixes an earlier inadvertent legislative mistake so that the 2013 farmer sign-up for the Conservation Stewardship Program can proceed; without the fix there is no 2013 sign-up, which would result in a $1 billion loss to long-term farm bill conservation funding.

An additional talking point for the bill is that adoption of the net $27.5 billion in long-term farm bill cuts would allow the Agriculture Committees to write a new five-year Farm Bill that would require no additional net cuts.

Within the $3.5 billion Farm Bill spending restoration, the Mikulski-Murray-Reid package would provide for two years of livestock and fruit disaster payments as well as an extension of the Supplemental Revenue Assistance Payment Program known as SURE.  In addition, it would provide 2013 funding for the following programs that were left out of the Farm Bill extension passed on January 1:

  • Beginning Farmer and Rancher Development Program
  • Outreach and Assistance to Socially Disadvantaged Farmers and Ranchers
  • Rural Microentrepreneur Assistance Program
  • Value-Added Producer Grants
  • Organic Agriculture Research and Extension Initiative
  • Specialty Crop Research Initiative
  • Farmers Market Promotion Program
  • National Clean Plant Network
  • National Organic Certification Cost Share Program
  • Voluntary Public Access Conservation Program
  • Desert Terminal Lakes Conservation
  • Renewable Energy Programs, including Rural Energy for America Program, Biomass Crop Assistance Program, and six others.

The total funding provided for these “stranded” programs is $452 million.

NSAC strongly supports the Mikulski-Murray-Reid bill.  The measure is an important marker for the budget negotiations that will happen in March leading up to the March 27 deadline for the government-wide funding bill.  It is also an important marker for a path forward to get a full five-year Farm Bill reauthorized later this year.

Categories: Budget and Appropriations, Farm Bill

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