Road Ahead for New Farm Bill: More Open Process, But Funding Issue Returns

November 22, 2011 03:03 AM
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via a special arrangement with Informa Economics, Inc.

Impact of behind-closed-door process unclear; across-the-board cuts in play

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

The failure of the Super Committee to come up with even $1.2 trillion in debt reduction over 10 years also carried into defeat the behind-closed-doors farm bill package that the two top leaders of the Ag panels and their staffs rushed into linking with the debt package. The funding issue for the coming open debate for the omnibus farm bill is murky, again.

The farm bill baseline provided by the Congressional Budget Office (CBO) is the most likely place to start relative to the next step, contacts advise. They note that the farm bill baseline will now likely revert to the sequestration/across-the-board cuts fallback plan lawmakers agreed to if the Super Committee failed in its job. Prior estimates put the impact of across-the-board (ATB) cuts for agriculture at around $15 billion – over nine years. That would be below the $23 billion reduction in the baseline that the House and Senate Ag Committee leaders self-proposed relative to the recently failed farm bill/Super Committee approach.

The budget baseline gets more complex if one considers the House next year could produce a budget resolution with specific cuts, perhaps larger than the around $15 billion in play for agriculture-related funding. The Senate has not been able to produce a budget resolution for years. This possibility would set up the potential for far different farm bill baselines ahead.

Adding more ATB cuts to some programs is the fact that some programs are exempt from the cuts. The following agriculture-related programs/payments/activities would be exempt from any sequestration – across-the-board cuts”

-- Farm Credit Administration Operating Expenses Fund

-- Farm Credit System Insurance Corporation, Farm Credit Insurance Fund

-- Conservation Reserve Program

-- Biomass Energy Development

-- Federal Crop Insurance Corporation Fund

-- Federal Emergency Management Agency, National Flood Insurance Fund

-- Child Nutrition Programs (with the exception of special milk programs)

-- Commodity Supplemental Food Program

-- Supplemental Nutrition Assistance Program (SNAP/formerly Food Stamp Program)

Some observers think the $23 billion cut in the farm bill baseline may or should be the beginning point of the funding issues ahead. In a joint written statement following the failure of the Super Committee, co-chairs Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Texas) said they “remain hopeful that Congress can build on this committee’s work and can find a way to tackle this issue in a way that works for the American people and our economy.”

But another wrinkle regarding the farm bill baseline has arisen. Some lawmakers, even before a “regular order” farm bill is debated in 2012, could tap the $23 billion in savings already identified behind closed door to help pay for for year-end bills, such as extending the current payroll tax reduction which expires at year’s end, and a provision that limits the reach of the alternative minimum tax and an extension of federal unemployment benefits.

A return to a more “regular order” farm bill will take time, and will bring in a host of other stakeholders, many of whom felt left out in the secret farm bill process that aborted on Monday. After all, there were no actual agriculture subcommittee or committee votes on the aborted farm bill plan. Those votes are ahead. But it is the House and Senate floor debate and amendments that could bring spirited efforts to alter the game plan sought by the Ag panel leaders and a select few other lawmakers and their staff.

While it may not be back to square one for the farm bill process, the coming months will bring debate, far more open analysis and actual votes on the omnibus measure. The coming farm bill process will be far different that the behind-closed-door approach. As Sen. Pat Roberts (R-Kan.), the Ranking member on the Senate Ag Committee said Monday in a statement, “This process was not the way to write the Farm Bill. I call on the Senate Committee on Agriculture, Nutrition, and Forestry to hold open, public hearings where policy ideas are discussed and debated on their merits, followed by a mark-up that allows input by all committee members. Farm Bills have always been done this way, in a bipartisan manner. I look forward to returning to normal order and writing a bill that is good for all of Rural America while being responsible to taxpayers and our WTO obligations.”

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.






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