Programs Without Baseline Funding

October 27, 2010

By: Roger Bernard, Farm Journal Policy and Washington Editor

The following information is a Web Extra from the pages of Farm Journal. It corresponds with the article "Policy Journal" by Roger Bernard. You can find the article in the November 2010 issue.

Thirty-seven provisions in the 2008 farm bill received mandatory budget authority but are not assumed to receive such funding in the budget baseline beyond the end of the farm bill. This issue concerns some observers because a new farm bill would not have funding in the baseline budget to continue these programs. If policymakers want to continue these programs, they will need to pay for the programs with offsets from other sources.

The amount of mandatory funds that might be needed to extend these 37 programs is estimated here to be about $9 billion or $10 billion over a five-year period, depending on the approach to estimate costs. Either estimate is about 4% of the $283 billion five-year total cost of the 2008 farm bill, or 11% of the approximately $100 billion five-year cost if the nutrition title is excluded.7 It would cost even more to try to extend them for a longer time so that they could have baseline beyond the next farm bill.

The 37 programs:

Section	Name of Provision	Comments	Cost to extend ($ million, 5 years) CBO baseline in March 2010
Farm Commodity Programs
1622	Implementation (of farm commodity programs in Title I)	$50 million in FY 2009 to the Farm Service Agency to help implement the farm bill. Such expenses usually are discretionary.	50
Subtotal, Farm Commodity Programs			50
Conservation
2202	Wetlands Reserve Program	3.04 million acres to be enrolled through FY2012. The 2008 farm bill added $128-338 million of costs to baseline annually.	2,590
2403	Grassland Reserve Program	1.22 million additional acres to be enrolled during FY2009-2012. The farm bill added $63-80 million of costs to baseline annually.	274
2606	Voluntary Public Access and Habitat Incentive Program	$50 million for the period FY2009-2012, made available in FY2009.	50
2803	Small Watershed Rehabilitation Program	$100 million in FY2009, to remain available until expended. Discretionary appropriations also are authorized.	100
2807	Desert Terminal Lakes	$175 million in FY2008, to remain available until expended (transfer from USDA to Dept. of Interior’s Bureau of Reclamation).	175
Subtotal, Conservation			3,189
Trade
1306	McGovern-Dole International Food for Education and Child Nutrition Program	$84 million in FY2009, to remain available until expended. It also receives annual discretionary appropriations (e.g., $209 million in FY2010).	84
3206	Local and Regional Food Aid Procurement Projects	$5 million in FY2009, $25 million in FY2010 and FY2011, and $5 million in FY2012. Results of pilot program to be evaluated.	60
Subtotal, Trade			144
Nutrition
4141	Pilot projects to evaluate health and nutrition promotion in the supplemental nutrition assistance program	$20 million of mandatory funds in FY2009, to remain available until expended. Discretionary appropriations also are authorized.	20
4142	Study on Comparable Access to Supplemental Nutrition Assistance for Puerto Rico	$1 million of mandatory funds in FY2009, to remain available until expended.	1
4305	Whole Grain Products (for school lunches and breakfasts)	$4 million of Section 32 funds to be made available in FY2009 (CBO estimate).	4
4307	Survey of Foods Purchased by School Food Authorities	$3 million in FY2009.	3
4402	Assistance For Community Food Projects: Healthy Urban Food Enterprise Development Center	$1 million in each of FY2009-2011. Discretionary appropriations are authorized at $2 million for FY2012.	3
Subtotal, Nutrition			31
Rural Development
6022	Rural Microentrepreneur Assistance Program	$4 million in each of FY2009-2011 and $3 million in FY2012.	15
6029	Funding of Pending Rural Development Loan and Grant Applications	$120 million in FY2008, to remain available until expended, to reduce a backlog of approved applications. Discretionary appropriations usually fund these programs.	120
6202	Value-Added Agricultural Market Development Program Grants	$15 million in FY2009, to remain available until expended. It also receives annual discretionary appropriations.	15
Subtotal, Rural Development			150
Research
7206	Organic Agriculture Research and Extension Initiative	$18 million in FY2009, and $20 million in each of FY2010-2012.	78
7311	Specialty Crop Research Initiative	$30 million in FY2008, and $50 million in each of FY2009-2012.	230
7410	Beginning Farmer and Rancher Development	$18 million in FY2009, and $19 million in each of FY2010-2012.	75
Subtotal Research			383
Forestry
8205	Healthy Forests Reserve Program	$9.75 million each year for FY2009-2012, to remain available until expended.	39
Subtotal, Forestry			39
Energy
9002	Biobased Markets Program	$1 million in FY2008, and $2 million each year for FY2009-2012	9
9003	Biorefinery Assistance	$75 million in FY2009, and $245 million in FY2010. Discretionary appropriations also are authorized.	320
9004	Repowering Assistance	$35 million in FY2009, to remain available until expended. Discretionary appropriations also are authorized.	35
9005	Bioenergy Program for Advanced Biofuels	$55 million in each of FY2009-FY2010, $85 million in FY2011, and $105 million in FY2012, to remain available until expended.	300
9006	Biodiesel Fuel Education Program	$1 million in each of FY2008-2012.	5
9007	Rural Energy For America Program (REAP)	$55 million in FY2009, $60 million in FY2010, and $70 million in each of FY2011- 2012, to remain available until expended.	255
9008	Biomass Research and Development	$20 million in FY2009, $28 million FY2010, $30 million in FY2011, and $40 million in FY2012, to remain avail. until expended.	118
9011	Biomass Crop Assistance Program	Indefinite appropriation of mandatory funds (such sums as necessary) for FY2008-2012. Outlays in March 2010 CBO baseline of $283 million in FY2010, $456 million in FY2011, $409 million in FY2012, $244 million in FY2013, falling to zero by FY2017.	836 (Based on the March 2010 CBPO baseline, but multiplied by 60% on the assumption its costs in future will decrease under USDA's final implementation rules,which are expected to reduce outlays compared to USDA's initial implementation.)
Subtotal, Energy			1,878
Horticulture and Organic Agriculture
10106	Farmers' Market Promotion Program	$3 million in FY2008, $5 million in each of FY2009-FY2010, and $10 million in each of FY2011-FY2012.	33
10202	National Clean Plant Network	$5 million in each of FY2009-2012, to remain available until expended.	20
10301	National Organic Certification Cost-Share	$22 million in FY2008, to remain available until expended.	22
10302	Organic Production and Market Data Initiatives	$5 million in FY2008, to remain avail. until expended. Discretionary also is authorized.	5
10404	Market Loss Assistance for Asparagus Producers	$15 million in FY2008 for market loss payments for the 2004-2007 crop years.	15
Subtotal, Horticulture and Organic Agriculture			95
Livestock
11009	National Sheep Industry Improvement Center	$1 million in FY2008, to remain available until expended.	1
Subtotal, Livestock			1
Agricultural Disaster Assistance
12033 and 15101	Supplemental agricultural disaster assistance, including establishing the Agricultural Disaster Relief Trust Fund	Authorized for FY2008-FY2011. CBO estimated in 2008 that the cost would be $4.846 billion for the program over 4 years, ending in FY2011 (see also Table 3). The March 2010 baseline projects $3.680 billion of outlays for the life of the provision.	3,680 (The March 2010 CBO projection of outlays for the current four-year program. A future program to cover five crop years for a full arm bill, or six years to cover the last year of the current farm bill, would cost relatively more.)
Subtotal, Agricultural Disaster Assistance			3,680
Miscellaneous
14004	Outreach and Technical Assistance for Socially Disadvantaged Farmers or Ranchers	$15 million in FY2009, and $20 million each year for FY2010-2012.	75
14012	Determination on Merits of Pigford Claims	$100 million in FY2008, to remain available until expended. Discretionary appropriations; $1.15 billion currently is being sought to fund a legal agreement that was reached with litigants in February 2010.	100
Subtotal, Miscellaneous			175
Total: 37 provisions in 2008 farm bill without baseline beyond FY2012			9,815
Subtotals by term (or duration) of mandatory funding
Short	20 provisions with short-term use of mandatory funds in 2008 Farm Bill		4,803
Full	17 provisions with full-term use of mandatory funds in 2008 Farm Bill		5,012
Subtotals by type of certainty about costs
Fixed	33 provisions where cost is fixed or known in the farm bill		2,435
Estimated	4 provisions where cost is estimated based on implementation		7,380