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Wednesday, August 24, 2011

Agriculture and Related Agencies: FY2012 Appropriations

Jim Monke, Coordinator
Specialist in Agricultural Policy

The Agriculture appropriations bill provides funding for all of the U.S. Department of Agriculture (USDA) except the Forest Service, plus the Food and Drug Administration (FDA) and, in alternating years, the Commodity Futures Trading Commission (CFTC). Appropriations jurisdiction for the CFTC is split between two subcommittees—the House Agriculture Appropriations Subcommittee and the Senate Financial Services Appropriations Subcommittee.

An FY2012 Agriculture appropriations bill has been passed by the House, but the Senate has yet to mark up or report an Agriculture appropriations bill from committee.

In the House, the Agriculture appropriations subcommittee marked up its FY2012 bill by voice vote on May 24, 2011. The following week, the full appropriations committee reported the bill (H.R. 2112, H.Rept. 112-101) by voice vote, after adopting several amendments. On June 16, 2011, the House passed H.R. 2112 by a vote of 217-203 after adopting 22 amendments and removing 4 provisions by point of order.

The House-passed bill would cut discretionary Agriculture appropriations to $17.25 billion, a reduction of $2.7 billion (-14%) from FY2011 levels, and following a 15% cut in FY2011. Much of the floor debate related to funding reductions for Women, Infants and Children (WIC) feeding program (-11%), food safety (-10%), international food aid (-31%), preventing USDA payments to Brazil in relation to the U.S. loss in the WTO cotton case, and programs promoting locally produced food (USDA’s “know-your-farmer-know-your-food” initiative). Other more notable non-money amendments that were adopted would prevent funding of blender pumps for higher mixtures of ethanol, prevent funding related to the RU-486 abortion pill (proposed relative to the USDA telemedicine program, but also affecting the FDA), prevent food aid to North Korea, and prevent implementation of USDA policy on climate change adaptation. The bill also includes a 0.78% across-the-board rescission to discretionary accounts.

If H.R. 2112 were to be enacted, the 10-year change in discretionary agriculture appropriations would be nearly flat, increasing at an average annualized rate of +0.6%. The nutrition portion of discretionary appropriations would show a +2.6% average annual increase over 10 years, while the rest of the bill would have an average annual decline of -0.4% over 10 years. If these amounts are adjusted for the effect of inflation, the annual rates are each about 2% less.

The House-passed bill for FY2012 contains nearly $2 billion in rescissions and limitations on mandatory farm bill programs. These actions are used to score savings that help meet the $17.25 billion discretionary budget allocation and help avoid deeper cuts to regular discretionary accounts. The FY2012 bill has the same $2 billion level of rescissions and limitations as the FY2011 appropriation. Had the FY2012 House-passed proposal not maintained this level of reductions—which is significantly greater than in past years—even larger cuts might have been required to the regular discretionary accounts. The FY2012 House bill proposes a unusually high $1.4 billion reduction to mandatory farm bill programs, including $1 billion from conservation.

On August 2, 2011, the Budget Control Act of 2011 (P.L. 112-25) was enacted. It sets the total FY2012 discretionary limit for all 12 appropriations bills at $1.043 trillion, $23.6 billion higher (+2.3%) than the House budget resolution. Although the Agriculture appropriations bill has not yet received an allocation from this new amount, some believe that the higher amount in P.L. 112- 25 implies that the final subcommittee allocation might be higher than in the House-passed bill.

Date of Report: August 11, 2011
Number of Pages: 69
Order Number: R41964
Price: $29.95

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