Senate Appropriations Approves USDA/FDA FY 2017 Spending Bill

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The Senate Appropriations Committee approved 30-0 the $21.25 billion Fiscal 2017 spending bill for USDA and the Food and Drug Administration (FDA), a decline of $250 million compared to the 2016 enacted level. House appropriators sent their $21.3 billion agriculture bill to the full chamber April 19. The measure includes an important pilot amendment farmers and lawmakers have pushed far regarding the Ag Risk Coverage (ARC) program.

The bill would delay implementing an FDA rule that would require nutrition labeling on chain restaurant menus. A manager’s amendment agreed to by panel members would also block the USDA from finalizing a rule expanding food stocking requirement for retailers participating in the Supplemental Nutrition Assistance Program (SNAP/food stamps).

The bill would give FDA $2.76 billion in discretionary funding, an increase of $39 million over the FY 2016 enacted level, according to a committee statement. Total funding for the FDA, including revenue from industry-paid user fees, would be $4.78 billion, which would be $103 million above FY 2016. Within this total, medical product safety activities would increase by $11.9 million, and food safety activities would rise by $40.2 million, the committee said. The bill also includes language delaying implementation of rules requiring chain restaurants to provide nutritional information on menus.

GMO salmon labeling amendment approved. Lawmakers adopted an amendment by Sen. Lisa Murkowski (R-Alaska) requiring producers of genetically engineered salmon to label their products. “In a letter sent to Senate Appropriations leadership this week, Biotechnology Innovation Organization (BIO( President and CEO Jim Greenwood pointed to GMO disclosure and transparency efforts already underway in the Senate Agriculture Committee. “As we understand it, the approach under consideration by that committee would apply to foods produced through biotechnology – such as GE salmon – and would provide information to consumers through a marketing disclosure mechanism, and not via a required label that would be perceived as a safety warning and thus would mislead consumers.”

U.S. personnel in Cuba to promote US agricultural exports would be funded by a provision in the bill, providing $1.5 million for a Foreign Agricultural Service (FAS) office in Cuba. FAS is working on collaborative activities that would eventually allow U.S. representation in Cuba to move beyond limited technical activities and into trade promotion within any applicable legal limits, the aide said. The $1.5 million in funds would cover the startup costs for the first year of operations of the new Cuba post.

ARC pilot plan amendment adopted. The panel adopted an amendment from Sen. John Hoeven (R-N.D.) regarding a pilot plan to create a new $5 million, nationwide pilot program to improve the fairness of Agriculture Risk Coverage (ARC) county-level payment calculations for the 2016 crop year. The senator has been pushing for greater flexibility in the way yields are calculated with USDA Sec. Tom Vilsack and Farm Service Agency Administrator Val Dolcini.

Background. “For purposes of determining ARC county payments, USDA has used National Agriculture Statistics Service (NASS) county data to determine yields,” Hoeven said. “The problem is that in some cases, there isn’t enough NASS data for a particular county to get an accurate assessment of yield and the USDA has substituted other yield data that in certain cases doesn’t match actual yields. This pilot program provides a backup, so that if a state’s Farm Service Agency office determines that USDA’s current calculation method is insufficient to make an accurate determination, an alternative method of documenting yields can be used that will provide farmers with a fair payment.”

Under the pilot program, USDA will provide state FSA offices a role in ensuring accurate yield determinations under the ARC program. If the FSA office finds a disparity between yield calculations in comparable counties, the office will have an opportunity to fix any inaccuracy by using an alternate calculation method. The alternative method could result in an additional payment for farmers in the affected counties to rectify the disparity.

Details. Specifically, under the Hoeven pilot program, if a state FSA office determines that the alternate calculation method is necessary for a particular county, this method would work as follows:

• If there is insufficient NASS data for a particular county or if the county NASS data produces a “substantially disparate” result, then a yield calculation for the county is determined by using NASS data from a comparable neighboring county; and
• Should there be insufficient data from a ?comparable neighboring county, the state FSA can use reliable yield data from other sources such as Risk Management Administration (RMA) data or NASS district data.

ARC county payments became an issue for farmers in North Dakota because under USDA’s current method of calculating yields, no payments were made to corn growers in LaMoure and Logan counties, and inadequate payments were made to farmers in Ransom and Steele counties for the 2014 crop year. Currently, yields are determined using voluntary yield data reported by producers to the NASS; however, in some counties reporting is sparse, resulting in no or inaccurate data on which to base ARC payments.

The Hoeven amendment is fully offset, with a $5 million reduction to the Agriculture Buildings and Facilities account.

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