The Senate Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies held a hearing this week amidst the buzz of Farm Bill activities on Capitol Hill.  Subcommittee Chairman Mark Pryor (D-AR) and Ranking Member Roy Blunt (R-MO) took a break from floor action on the Farm Bill to lead Thursday’s hearing addressing the USDA’s FY 2014 budget requests for conservation, rural development, credit and renewable energy programs.

Among the witnesses who testified were:

• Darci Vetter, Acting Under Secretary for Farm and Foreign Agricultural Services
• Ann Mills, Deputy Under Secretary for Natural Resources & Environment
• Doug O’Brien, Acting Under Secretary for Rural Development
• Michael Young Director, Office of Budget and Program Analysis

In addition to the traditional concerns of their home states, the Chairman and Ranking Member (who were the only two subcommittee members present) took less than an hour to ask a range of questions on rural development programs, trade barriers related to the use of growth hormones, and the administration’s renewable energy priorities.

Rural Development

Rural development was a topic that dominated much of the hearing, which isn’t all that surprising given the members’ home states.  Rural Development Acting Under Secretary Doug O’Brien was asked about the administration’s proposed consolidation of four separate rural development grant programs into a new Rural Business and Cooperative Grant program.  Under the consolidation, the following existing RD programs would be lumped into a single funding request: Rural Business Enterprise Grants, Rural Business Opportunity Grants, Rural Microentreupreneur Assistance Program Grants, and Rural Cooperative Development Grants.

Ranking Member Blunt expressed concern on how the disparate needs of the varying programs would be addressed in the proposed consolidation, and asked why the agency chose to go forward with the proposal in their FY 2014 budget request instead of waiting for the farm bill to address the issue.  O’Brien stated that although the farm bill does address consolidation, the agency needed to act in order to streamline delivery of services under very tight budget constraints.  He claimed that the agency used current authority in its budget process to streamline its work flow and make the application and approval process more efficient, and stated that the agency will use its discretion to maintain the integrity of each program based on eligibility requirements for each grant.  He also noted the success of the programs that would be consolidated by highlighting a farmers market in Newport, Arkansas — the Chairman’s home state.

Renewable Energy

Acting Under Secretary O’Brien was also asked to clarify the administration’s $4 billion dollar request for Rural Electric Cooperatives.  O’Brien explained that $3 billion of the requested funds would be committed to renewable energy projects of any kind, including transmission lines, and the remaining $1 billion would be committed to upgrades of fossil fuel plants.  He clarified that the $3 billion is only a floor amount and that the remaining $1 million committed to fossil fuel plants could be reallocated to renewable energy projects in order to incentivize a changing mix within energy for rural America.

Trade 

Also of note for the sustainable agriculture community was the testimony of Darci Vetter, Acting Under Secretary for Farm and Foreign Agricultural Services — which encompasses the Risk Management Agency, Farm Service Agency, and the Foreign Agricultural Service.  When asked about the challenges facing American agriculture exports, Vetter spoke of sanitary challenges being a bigger challenge than tariffs.  She highlighted Russia and China’s ban on any meat containing the growth hormone Ractopamine.  She said the agency would continue to fight these bans but would also make a push to reduce, and perhaps phase out altogether, the use of the banned growth hormone in the United States.  This two pronged approach, she testified, would hopefully open up two of the world’s biggest markets for the U.S. meat producers and address consumer and public health concerns at the same time.

FY14 Appropriations Timing

Unfortunately, due to the action surrounding the farm bill debate on the Senate floor, there were few subcommittee members who were able to attend this week’s hearing, and neither the Chair or Ranking Member addressed any of NSAC’s top appropriations priorities — including the Value-Added Producer Grant Program, conservation technical assistance, direct farm operating and ownership loans, and the Appropriate Technology Transfer for Rural Areas (ATTRA) program.  We will continue to push to maintain funding levels for these programs as the appropriations process proceeds in both the House and Senate.

The Senate Appropriations Committee is expected to mark-up the agriculture spending bill for FY14 “soon” — most likely within the week or two following next week’s congressional recess.  On the House side, the Agriculture Appropriations Subcommittee will likely hold their mark-up sometime during mid-June, however no date has been set.  Considering that the House is slated to take up the farm bill the week of June 17th, it’s likely that House subcommittee markup would either be the week of the 10th or 24th so that it does not conflict with the farm bill debate.