The Congressional Budget Office (CBO) today released estimates that enacting the Senate-proposed Agriculture Reform, Food, and Jobs Act of 2012 would reduce direct spending by $23.6 billion over the 2013-2022 period, relative to spending projected under CBO's current baseline.
When combined with estimated spending under CBO's baseline projections for those programs, CBO said it estimates that enacting the Agriculture Reform, Food, and Jobs Act of 2012 would bring total direct spending for those USDA programs to $969 billion over the 2013-2022 period-$23.6 billion less than CBO projects would be spent if those programs were continued as under current law.
Of note, CBO estimated the cost of the controversial Ag Risk Coverage (ARC) program at $28.536 billion over 10 years -- ARC payments would average $3.2 billion per year, just $1.6 billion below annual payments made via the eliminated direct payment program.
The modified Supplemental Coverage Option (SCO) would add $3.001 billion over 10 years. Beginning with the 2014 crops, the SCO authorized in section 11001 would allow farmers to combine farm-level crop insurance coverage with crop insurance based on county-level coverage. This option would be subject to a deductible of 21 percent of expected revenue for farmers participating in the Agricultural Risk Coverage program or 10 percent of expected revenue for farmers not participating in the ARC program. USDA would pay 70 percent of the premium for the SCO policy.
The cotton STAX program costs are put at $3.224 billion.
The controversial dairy policy provision is estimated to save $59 million over 10 years. The new program would cost $291 million, but repealing some current dairy policy provisions would bring net savings.
Other areas seeing an increase in spending relative to the baseline: Energy title, up $780 million; Research title, up $647 million; Horticulture (specialty crops) title, up $360 million.
Nutrition program spending would be reduced $3.874 billion compared to the baseline
Conservation is reduced $6.4 billion; CRP cap to 25 million acres by 2017 cuts spending $3.8 billion.