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Agriculture Cuts in the Budget Deal

The fiscal year (FY) 2011 budget deal cuts $38.5 billion from FY ’10 spending levels, of which $20 billion is from discretionary programs and $17.8 billion is from mandatory programs. Agriculture is funded at $20 billion, $3 billion less than FY ’10 spending levels and $3.2 billion below the administration’s 2011 proposed budget. Cuts for USDA compared to FY ’10 include:

• $10 million from the Food Safety and Inspection Service (FSIS).

• $453 million from Agricultural Credit Insurance Fund.

• $44 million from the Agricultural Research Service.

• $125.9 million from the National Institute for Food and Agriculture.

• $504 million from the Women’s, Infant’s and Children’s program (WIC).

• $151 million from Rural Housing loan subsidies.

• $194 million from Foreign Food Assistance.

• $119 million from the Wetlands Reserve Program.

• $29 million from the Conservation Stewardship Program.

• $80 million from the Environmental Quality Incentives Program (EQIP).

• $134 million from the Biomass Crop Assistance Program (BCAP).

• $350 million from dairy subsidies.

One of the largest cuts was in the Environmental Protection Agency‘s (EPA) budget, which was cut by $1.6 billion (16%) from last year’s budget. The next big budget fight will be when Congress has to raise the debt ceiling, which could take place as early as mid-May or no later than July.

President Outlines Fiscal Responsibility Plan — President Barack Obama outlined the administration’s plan to address the national debt. The plan would reduce the deficit by $4 trillion in 12 years or less. The proposal would call for bringing down the deficit with $3 of spending cuts and interest savings for every $1 from tax reform that contributes to deficit reduction. This is similar to the bipartisan Debt Commission’s recommendations. The plan would make significant cuts in domestic and defense spending and would not extend the Bush tax cuts on the wealthiest. Under the “other mandatory spending” section, the plan states, “Outside of health care, comprehensive deficit reduction must include savings in other mandatory programs.” This includes measures to “reform agricultural subsidies, shore up the federal pension insurance system, restore solvency to the federal unemployment insurance trust fund and enact anti-fraud measures.” President Obama proposes instituting a trigger mechanism that would require automatic cuts if the debt is not declining as a share of the economy by the second half of the decade.

Members Challenge EPA Dust Rule — Over 100 members of Congress have written the Environmental Protection Agency (EPA) stating their concerns about the agency’s potential revision to the National Ambient Air Quality Standards for Coarse Particulate Matter, also known as the “dust rule.” The members emphasized the potential negative impact on farmers, ranchers and rural America if the EPA moves forward with regulating dust at unprecedented levels. The letter stated, “At a time when the focus of the administration should be on economic development and job creation, the EPA is instead promulgating rules, which may have the opposite effect. If implemented, the standards could subject farmers, livestock producers and industry to burdensome regulations, which could result in fines amounting to $37,500 a day for violations. We strongly encourage the EPA not to implement the more stringent standards.” The bipartisan letter was organized by Congresswoman Kristi Noem (R-SD) and Congressman Stephen Fincher (R-TN).

Senate Subcommittee Chairs and Ranking Members Named — The chairman and ranking members of the Senate Agriculture Committee subcommittees have been named for the 112th Congress. They are: Commodities, Markets, Trade and Risk Management – Senators Ben Nelson (D-NE), chairman, and Saxby Chambliss (R-GA), ranking member; Jobs, Rural Economic Growth and Energy Innovation – Sherrod Brown (D-OH), chairman, and John Thune (R-SD), ranking member; Conservation, Forestry and Natural Resources, Michael Bennet (D-CO), chairman, and John Boozman (R-AR), ranking member; Nutrition, Specialty Crops, Food and Agricultural Research, Bob Casey (D-PA), chairman, and Dick Lugar (R-IN), ranking member; Livestock, Dairy, Poultry, Marketing and Agriculture Security, Kirsten Gillibrand (D-NY), chairwoman, and Mike Johanns (R-NE), ranking member.

P. Scott Shearer
Vice President
Bockorny Group
Washington, DC