The Biden-Harris Administration released the President’s Budget Request (PBR) for the Fiscal Year (FY) 2023 on March 28, 2022. The $5.8 trillion budget request comes several months late, as the budget request is typically expected to be presented to Congress on the first Monday of February.  Yet this budget represents an improvement relative to the PBR FY 2022 timeline, which was issued on May 28th, 2021, due to the previous Administration’s refusal to concede the 2022 election. The detailed proposal for FY 2023 (October 1, 2022 – September 30, 2023) includes the President’s discretionary spending plans and builds on the PBR FY 2022 but does stray from the spending priorities put forward in that document in ways that are discussed in detail below. 

The $5.8 trillion in proposed spending includes $1.6 trillion in domestic spending – a roughly 7 percent increase from the previous year’s budget – with continued focus on addressing issues made worse by the pandemic, including affordable housing, manufacturing capacity, supply chain disruptions, and climate change. Notably, the budget also contains larger increases in defense spending – $773 billion or roughly 10 percent greater than FY 2022 levels – and a series of new tax proposals aimed at corporations and the very wealthiest households that would reduce budget deficits by $1 trillion over a decade. 

As part of the $5.8 trillion in proposed discretionary spending, the President’s budget proposes $28.5 billion in spending for the United States Department of Agriculture (USDA). The $4.2 billion increase (17.1 percent) in proposed spending for USDA is significant and builds on the proposed FY 2022 increase of nearly $4 billion in additional spending (+16.7%) when compared with the FY 2022 agriculture spending bill.

**It is important to note that the PBR FY 2023, including descriptions of USDA programming and the related Appendix, does not include the actual funding provided in the FY 2022 Omnibus because that funding package was passed just before the PBR FY 2023 was issued. Rather, “the Budget assumes this account is operating under the Continuing Appropriations Act, 2022 (Division A of Public Law 117–43, as amended). The amounts included for 2022 reflect the annualized level provided by the continuing resolution.” This makes it challenging to assess the impact of the PBR FY 2023 on actual FY 2022 spending using the PBR FY 2023 alone. The NSAC Agricultural Appropriations Chart includes the correct FY 2022 Omnibus enacted spending levels.** 

Budget Overview

The release of the President’s budget proposal marks the official beginning of the hectic annual budget and appropriations legislative process. The President’s budget lays out the Executive branch’s vision for how funding should be allocated by Congress as it develops and passes appropriations bills. Congress works to develop and pass 12 discretionary appropriations bills each year, one of which includes food and agriculture spending. 

The PBR FY 2022 contained significant, new mandatory spending for conservation and forestry programs that were intended to guide funding that was anticipated when the Senate Democrats passed the Build Back Better Act (or a similar legislative package) through the budget reconciliation process. This PBR FY 2023 does not make such ambitious requests but rather emphasizes existing conservation and supply chain resilience spending made available through the previous covid relief packages supported by discretionary spending. It also renews emphasis on interagency collaborations such as the America the Beautiful Initiative and the Justice40 commitments. There is also greater focus on rural development programs – including housing, green energy transition, broadband, and workforce development – that are not uncommon in the budget request prior to a midterm election. 

However, the nearly $4.2 billion in additional discretionary spending proposed for the USDA includes considerable new investments in a number of important sustainable agriculture and food systems programs. Of particular interest is nearly $1.8 billion in spending throughout a range of programs that is intended to “address climate change across private, working agricultural land.” 

Research and extension programs would receive considerable new investments if the President’s budget were enacted, with the Agriculture and Food Research Initiative (AFRI) receiving $564 million (+$119 million over ‘22 Omnibus) and the Sustainable Agriculture Research and Extension (SARE) program receiving $60 million (+$15 million, for full funding). The President’s Budget mentions that part of the additional $500 million requested for research includes $315 million targeted to underserved populations and $62 million for agriculture research, education, and extension grants for tribal institutions.

Programs that support the development of local and regional food systems and healthy food access would also receive increased funding, with the Value Added Producer Grant program (VAPG) receiving $15 million in discretionary funding for grants (+2 million), and the Office of Urban Agriculture receiving $13 million (+$4.5 million). The budget also proposes to maintain support for the Farmers Market and Local Food Promotion Program with $7.4 million in discretionary funding. 

Unpacking the President’s FY 2023 Budget

In this post, NSAC outlines the Administration’s proposed FY 2023 budget as it pertains to the sustainable agriculture community. For a summary of funding proposals for programs NSAC tracks included in the President’s budget visit our newly updated appropriations chart. Issue areas covered in this analysis include:

• Climate and Conservation
• Research and Food Safety
• Local Food and Rural Development
• Farm Loans and Beginning and Socially Disadvantaged Producers

Climate Change and Conservation

The President’s FY 2023 Budget Request builds on the PBR FY 2022 and while it is perhaps less ambitious in scope than that the preceding budget, it remains focused on using conservation programs to provide tools to farmers working to address climate change with boosts to conservation technical assistance to increase program access and the adoption of more integrated conservation practices. The PBR FY 2023 details the mandatory funding for various conservation programs that all receive increases by statute including: 

• Environmental Quality Incentives Program (EQIP) up $34 million to a total of $1.884 billion
• The Conservation Stewardship Program (CSP) up $89 million for a total of $889 million not including the funding allocated to existing contracts which brings the total annual funding to $1 billion.
• The Regional Conservation Partnership Program (RCPP) up $31 million increasing total program funding to $331 million

The PBR FY 2023 proposes to increase funding for Conservation Technical Assistance (CTA) by $125 million to a total of $885 million. CTA  is the backbone of USDA’s conservation programs. Through CTA, USDA Natural Resource Conservation Service (NRCS) field staff work with farmers to develop and implement conservation plans to conserve resources on their farms and fulfill conservation compliance requirements. This investment is greater than proposed in the previous budgets and would support the Administration’s intention to expand technical assistance for producers. The Administration highlights the fact that the PBR FY 2023 features nearly $1 billion for NRCS CTA beyond the the $1.7 billion that is available for CTA as part of other farm bill conservation programs. 

The PBR FY 2023 also calls for a specific investment of $4 million for NRCS to assist USDA to “develop and implement a program to measure, monitor, report, and verify the carbon sequestration, greenhouse gas reduction, and other environmental benefits of agricultural practices at the farm level and to increase the adoption of climate-smart agricultural practices.” The PBFY 2023 would also dedicate $24 million for the USDA Climate Hubs through a variety of funding lines to “accelerate science production and technology transfer to aid land management agencies, private landowners, and agricultural producers, including foresters, with scientifically sound climate adaptation.” 

Unlike the FY 2022 budget, the FY 2023 budget does not include mandatory spending increases (something that is generally outside the scope of the appropriations committees and the domain of the authorizing committees) for working lands conservation programs. 

Research and Food Safety

As mentioned above, research and extension programs would receive considerable new investments if the President’s budget were enacted. The President’s Budget Request FY 2023 includes $4 billion – an increase of roughly $500 million – for research, education and outreach programs over the FY 2022 enacted level. 

The President’s budget proposes to provide $564 million for the Agriculture and Food Research Initiative (AFRI) which is an increase of $119 million relative to the FY 2022 omnibus but is curiously short of the full funding ($700 million) that was included in the PBR FY 2022. The Sustainable Agriculture Research and Extension (SARE) program would receive $60 million (+$20 million), which is full funding and matches the PBR FY 2022. The Food Safety Outreach Program (FSOP), which funds food safety related outreach, education, training, and technical assistance projects that directly assist small and mid-sized farms, beginning and socially disadvantaged farmers, small processors, and small-scale wholesalers, would receive $10 million which is the full authorization for the program and what it received in FY 2022 omnibus. The PBR FY 2023 also includes a modest increase of $134 million to the $1.2 billion budgeted for the Food Safety Inspection Service to “provide inspection services so that meat and poultry producers would be better able to respond to market demands and provide safe and healthy food products. The Budget is providing targeted funds to support smaller producers so that they may increase their production capacity, which in turn would create a more diverse food supply chain.”

The Organic Transitions (ORG) research program, which helps support organic farmers and livestock producers, would be funded at $7 million, a decrease of $500,000 from the FY 2022 appropriations. This likely reflects the Administration’s desire to provide level funding for ORG but their failure to use FY 2022 appropriated funding amounts – rather than FY 2021 amounts – that were released only just before the PBR FY 2023 was released. The PBR FY 2023 does not mention the Organic Transitional Education and Certification Program (OTECP).

Local Food, Rural Development and Healthy Food Access

Local food, rural development, and healthy food access is another bright spot in the President’s budget request. 

The 2018 Farm Bill created the Local Agriculture Market Program (LAMP), a program championed by NSAC, which combined the Farmers Market and Local Food Promotion Program (FMLFPP) and the Value-Added Producers Grant Program (VAPG).

Under LAMP, both VAPG and FMLFPP are provided with permanent mandatory funding; however in combining those programs, FMLFPP ended up with $5.3 million less in annual mandatory funding compared to its annual level of funding under the 2014 Farm Bill. VAPG was provided with a small increase in mandatory funding relative to 2014 Farm Bill levels, but that increase is far less than the program’s historic funding levels which have typically included annual discretionary funding in addition to mandatory farm bill funding. Over the life of the 2014 Farm Bill, VAPG received on average $25.9 million in combined mandatory and discretionary funding per year; whereas under the 2018 Farm Bill, VAPG is provided with only $17.5 million in mandatory funding per year.

The President’s budget recognizes the importance of these keystone local food and entrepreneurship programs and builds on previous appropriations packages proposing $7.4 million in discretionary funds for FMLFPP (flat funding when compared to FY 2022) and $15 million discretionary spending for VAPG grants in the PBR FY 2023, a $2 million increase when compared to FY 2022.

The President’s budget proposes that the Rural Microentrepreneur Assistance Program (RMAP) be provided with $6 million as in previous budgets, but this is slightly less than what was provided in the FY 2022 Omnibus, though this level of funding should allow the program to provide $150 million worth of loans to micro-enterprises in rural communities. 

The PBR FY 2023 also proposes $13.5 million (an increase of $5 million relative to FY 2022 spending) to continue and expand the work of the new Office of Urban Agriculture (authorized in the 2018 Farm Bill). The PBR FY 2023 proposes $24 million for the WIC Farmers Market Nutrition Program which was anticipated to be level funding compared to FY 2022 but as Congress provided $26 million for the program in the FY 2022 Omnibus, the program would actually be cut under the proposed budget though this appears to have been an unintended consequence of the USDA’s reliance on inaccurate end of year Congressional spending estimates. The PBR FY 2023 includes $12 million for Farm to School Grant Program (level funding), $5 million for the USDA’s Healthy Food Financing Initiative (HFFI) (level funding), and $2.8 million for the Appropriate Technology Transfer for Rural Areas program (level funding), also known as the National Sustainable Agriculture Information Service. 

Farm Loans and Beginning and Socially Disadvantaged Producers

As part of an overall effort from the USDA to address historic and current racial discrimination with USDA programs and policies, the Presidents’ budget proposed to increase the USDA Office of Civil Rights by $9 million (based on FY 2022 spending estimates) to $32 million in FY 2023. Again, it seems that USDA did not anticipate the funding levels in the FY 2022 Omnibus as Congress provided the Office of Civil Rights with $35.3 million due in large part to concerns about the ability of USDA to administer debt relief for historically underserved producers. In addition, the Budget proposes $39 million for the Heir’s Relending Program, authorized in the 2018 Farm Bill, to resolve ownership and succession of farmland.

Access to credit is critical for farmers, particularly for those just beginning their careers and for producers not well served by the commercial lending sector. Farm Service Agency (FSA) loan programs fill the lending gap by providing financing for producers unable to secure credit from private lenders. For decades, these programs have increased access to credit for small and mid-size family farms and for operations run by beginning, socially disadvantaged, and veteran farmers.

The President’s FY 2023 Budget request largely maintains program levels for Guaranteed and Direct Operating loans, as well as for Guaranteed Farm Ownership loans which is sufficient to meet the needs of farmers based on Farm Service Agency estimates:

• Direct Operating Loans: $1.633 billion (flat relative to FY 2022)
• Direct Farm Ownership Loans: $2.8 billion (flat) 
• Guaranteed Farm Ownership Loans: $3.5 billion (flat)
• Guaranteed Operating Loans: $2.118 billion  (flat)

The FY 2023 Appropriations Process

With the President’s Budget Request in-hand, Congress acted quickly to begin appropriations hearings with the Senate taking the lead. Normally, the President’s budget would be followed by the House and Senate Budget Committee developing and passing a joint or concurrent budget resolution which sets the topline level of funding available to the Appropriations Committees to spend, often referred to as the 302(a) allocations. Congress has been increasingly side-stepping this element of the process due to partisan disagreements and has opted instead to negotiate topline spending levels – 302(a) – allocations as part of larger funding deals later in the process, which complicates the ability of appropriators to make full decisions regarding discretionary appropriations. 

Democratic leaders have not moved forward with adopting a joint budget resolution to set the 302(a) allocation for the appropriators which is likely due to the inability to reach agreement with Senate Republicans over the 302(a) allocations. Without a budget resolution Congress is able to move forward with hearings and the initial development of appropriations bills but without a resolution and 302(a) allocation Congress will be stymied from completing the process. In years past,  in lieu of a concurrent budget resolution the House has adopted a deeming resolution that “deems” a topline 302(a) funding level but doesn’t carry the weight that a full concurrent budget resolution would have. Deeming a topline 302(a) level for discretionary spending allows the House to move forward with providing interim allocations to the House appropriations subcommittees and the writing and marking-up of respective appropriations bills. 

It is possible that the House will once again adopt a deeming resolution that allows them to move forward with writing appropriations bills. However, at some point the House and Senate Republican and Democrats will need to agree upon an official top line 302(a) level to finalize FY 2023 appropriations. 

As the process moves forward, we will be watching closely to see how NSAC’s sustainable agriculture and food systems appropriations priorities are addressed and working with committee members to ensure robust support for NSAC priorities.