Cornucopia’s Take: The President’s budget proposal for 2019 is unlikely to be adopted as written, but it shows clearly where the administration’s loyalties lie. The National Sustainable Agriculture Coalition details what that proposal holds for the sustainable agriculture community, below.
PRESIDENT’S BUDGET PROPOSAL THREATENS FOOD, FARM, AND NUTRITION PROGRAMS
The deeply problematic proposals of the President’s fiscal year (FY) 2019 budget, released on Monday of this week, include devastating cuts to critical farm and food programs. The budget, if enacted, would reduce the U.S. Department of Agriculture’s (USDA) budget by a whopping 25 percent, from $24 billion to $18 billion. In addition to cutting discretionary funding, the budget request proposes to dramatically reduce farm bill funding for nutrition, conservation, and other farm and food programs.
The ill-advised proposals in this budget create few winners, but many losers. In addition to harming American family farmers, the proposal will strip rural communities of tools and resources needed for job creation and enterprise development, deny low-income individuals and families critical nutrition support, damage the health of our natural resources, and undercut years of advancements in agricultural research and seed breeding.
To read the National Sustainable Agriculture Coalition’s (NSAC) full reaction to the President’s budget, please click here. To view a detailed breakdown of the FY 2019 budget request relative to current funding levels, download our appropriations chart here.
Some of the most severe cuts to discretionary funding (funding that comes through appropriations rather than through the farm bill) in the President’s budget include: $183 million from Conservation Technical Assistance (CTA); $32 from the to the Economic Research Service (a 50 percent cut); and the complete elimination of rural enterprise development programs administered by the Rural Business and Cooperative Service (RBCS).
The most significant changes to mandatory farm bill spending are the President’s proposal to cut $213 billion from the Supplemental Nutrition Assistance Program (SNAP) over ten years, and the proposal to eliminate two of the nation’s most successful conservation programs — the Conservation Stewardship Program (CSP) and the Regional Conservation Partnership Program (RCPP). The cut to SNAP, a program upon which millions of Americans rely for access to healthy food, is $20 billion larger than the $193 billion cut proposed by the President last May.
The President’s budget request is not the final say on the matter, thankfully. This proposal is primarily important because it sets the tone for budget negotiations and lays out a clear picture of the Administration’s priorities; ultimately, Congress will decide appropriations levels for FY 2019 as well as funding levels for the 2018 Farm Bill. For a full breakdown of the budget, see our updated FY 2019 Appropriations Chart.
In the following summary of the President’s budget proposal, we outline areas of particular interest and concern to the sustainable agriculture community, including:
- Nutrition Assistance
- Research and Food Safety Outreach
- Socially Disadvantaged Farmers
- Rural Development
- Local and Regional Food Systems
- Farm Loans
- Crop Insurance and Commodities
The budget proposal’s sweeping cuts to farm bill conservation programs are extremely counterproductive, undermining the long-standing partnership between farmers and USDA’s Natural Resources Conservation Service (NRCS). Tens of thousands of farmers use NRCS conservation programs each year to enhance their soil, reduce water pollution, and protect wildlife habitat and other natural resources. Moreover, farmers use programs like CSP to help them prepare for extreme weather by increasing the resilience of their farming operations. NRCS programs are routinely oversubscribed, with more than half of all qualified applicants turned away each year. Despite the clear need and demand for these programs, the President’s budget takes a slash and burn approach, leaving farmers, ranchers, and our shared natural resources to pay the price.
Among the most shocking attacks on conservation in the President’s proposal is the inclusion of two proposals that would entirely wipe out the Conservation Stewardship Program (CSP). CSP is the nation’s largest conservation program, and helps farmers and ranchers implement whole-farm conservation plans to address priority resource concerns including soil health, water quality, and wildlife habitat.
The first way the proposal seeks to attack CSP is through the appropriations process. Typically, the job of determining farm bill spending levels is left to the authorizing committees – in this case, the Agriculture Committees. There is, however, a process by which appropriators can limit mandatory farm bill spending via a mechanism known as Changes in Mandatory Program Spending (CHIMPS). The President’s budget request asks appropriators to use CHIMPS to cut all farm bill mandatory spending for CSP in FY 2019. Were it to become reality, conservation plans and activities would be applied on 10 million fewer acres as a result.
The budget’s second assault on USDA conservation programs comes through a proposal to completely eliminate CSP and the Regional Conservation Partnership Program (RCPP) in the upcoming farm bill. While CSP takes a holistic approach to conservation, RCPP supports conservation projects through partnerships with farmers and entities like state governments or non-profit organizations. Although the budget request does not include CHIMPS or a farm bill cut to CSP’s sister program, the Environmental Quality Incentives Program (EQIP), it does propose rescinding $136 million in carry-over funding.
The President’s budget also includes an appropriations proposal to cut $183 million (24 percent) from FY 2017 levels for CTA. This cut to CTA is even more drastic than last year’s proposal, which was strongly rejected by both the House and Senate’s FY 2018 agriculture appropriations bills. We are thankful that Congress recognizes the critical role of on-the-ground NRCS field staff who deliver and implement conservation services across the country; we will continue to work with congressional appropriators to ensure adequate funding for CTA in FY 2018 and 2019.
In addition to crippling USDA conservation programs, the budget request proposes to reduce the Environmental Protection Agency’s (EPA) budget by 23 percent. It would also eliminate one of EPA’s most popular and effective water quality programs, the 319 grants program, which has played a crucial role in helping states and other entities address nonpoint source water pollution.
NSAC and our allies in the anti-hunger and nutrition communities strongly oppose the President’s proposal to cut $217 billion from SNAP over the next ten years. SNAP not only connects millions of children and their families with healthy foods every year, it also expands market opportunities for family farmers. Although it is routinely framed as an urban assistance program, the percentage of rural families receiving SNAP assistance is actually higher than the percentage of urban families receiving assistance. By supporting both the family and the farmer, SNAP uplifts both urban and rural communities.
The President’s budget attempts to dismantle SNAP through a death-by-a-thousand-cuts approach. Last year, the President proposed undermining SNAP by making it a block grant program; this year’s proposals, however, are even more cruel and damaging. Among the most concerning proposals are those to: eliminate a portion of SNAP families’ spending power, replacing electronic benefits with food boxes of non-perishable goods; cutting off benefits for families with more than six people; and eliminating all spending on nutrition education.
Destabilizing our nation’s primary safeguard against hunger is not only inhumane, it also has the potential to completely derail the likelihood of a 2018 Farm Bill.
The budget makes deep cuts to USDA’s research programs, including a 30 percent cut to the Sustainable Agriculture Research and Education (SARE) program. This cut to SARE would reduce the program’s funding to just $19 million, despite the fact that the Senate has proposed to increase SARE funding to $30 million in FY 2018. The budget holds funding for the Agriculture and Food Research Initiative flat at $375 million; however, this too could end up being a cut depending on what Congress includes in their final FY 2018 omnibus. Out of touch proposals like these will mean that farmers and ranchers are unable to access the cutting edge research that they need to respond to growing and evolving challenges.
The President also proposes a 14.5 percent ($173 million) cut to the Agricultural Research Service (ARS), and a severe 50 percent cut to USDA’s Economic Research Service (ERS). Ironically, even while slashing funding for ARS staff and programs, the addendum to the budget proposes to restore some funding for ARS buildings and facilities.
Organic research is also targeted in the budget proposal, which proposes to eliminate funding for the Organic Transitions program.
The Food Safety Outreach Program’s funding is left flat at $5 million; however, this level of funding is nowhere near sufficient to meet the needs of the 100,000+ farmers that are now facing new food safety regulations and need support understanding how to ensure their farm is in compliance.
The President’s budget proposal exacerbates the challenges faced by historically underserved farmers and ranchers in America. The Outreach and Assistance to Socially Disadvantaged and Veteran Farmers and Ranchers program (also known as the Section 2501 Program) is the only USDA program explicitly dedicated to providing tools and resources to these communities. The FY 2019 budget request includes no discretionary funding for the Section 2501 Program, nor does it request renewed farm bill funding.
We are also very concerned that the budget request seems to eliminate both the Office of Advocacy and Outreach (OA&O), which administers the 2501 program, and the Office of Tribal Relations (OTR). As to be expected based on previous proposals, the budget request combines OA&O with the Faith-Based and Neighborhood Partnership, OTR, and the Military Veterans Liaison to create a new “Office of Partnerships and Public Engagement” (OPPE). However, despite promises that “each office will retain its own character and identity,” the budget request asks appropriators to delete all references to both OAO and OTR.
As was the case with the President’s budget last year, this year’s proposal once again attacks rural communities through the proposed elimination of all discretionary funding for programs administered by USDA’s Rural Business and Cooperative Service (RBCS). RBCS includes the Rural Business Development Grants program, Rural Cooperative Development Grants, Business and Industry Loan Guarantee Program,the Appropriate Technology Transfer for Rural Areas program, and the Value-Added Producer Grantsprogram.
Without these critically important business and infrastructure development programs, rural communities will lose a key source of both investment capital and technical resources. Enterprise development and expansion will suffer and, as a result, population out-migration will increase.
While the FY 2019 budget request does not propose the elimination of the Farmer Market and Local Food Promotion Program (FMLFPP), as the President proposed in his FY 2018 request, it does propose cutting all funding for the Farmers Market Nutrition Program for Women, Infants, and Children (WIC-FMNP). WIC-FMNP is a critically important program that helps particularly vulnerable populations access healthy food. Eliminating WIC-FMNP would increase hunger and lead to declining health outcomes among the American women and children in most need of increased access to fresh, healthy food.
We are also very concerned by the Administration’s proposal to “roll back or eliminate local and regional market reporting, including reporting of farmer’s markets and farm-to-school reporting” within the Agricultural Marketing Service’s (AMS) Market News. Market news provides critical access to market information for farmers and industry. This type of information is particularly important where demand and supply are rapidly evolving, as is the case with the rapidly growing market for locally and regionally produced foods.
Several of the aforementioned RBCS programs slated for elimination in the President’s budget would also have disproportionately adverse effects on local and regional food systems. Cutting the B&I program, which includes a local and regional food enterprise development set aside, and VAPG, which helps thousands of farmers tap into growing demand for locally and regionally produced food, would severely harm burgeoning farm-to-fork supply chains.
The President’s budgeted levels for Farm Service Agency (FSA) loans are similar to FY 2017 levels, but with a small decrease for Direct Operating Loans and a larger $360 million decrease for Guaranteed Operating Loans. These numbers reflect the recent decline in demand for loans from farmers and ranchers across the country. As appropriators continue to consider loan funding levels for FY 2019, we encourage them to work closely with FSA to ensure that enough funding is allocated to meet demand.
The budget has both hits and misses when it comes to commodity programs and crop insurance. On the positive end, the budget proposes long-needed changes that would eliminate loopholes in Title I subsidy programs. In particular, it proposes to prevent individuals and entities with little to no involvement in a farming operation from receiving farm program payments. This common sense proposal had been included in both the House and Senate’s version of the 2014 Farm Bill, but it was eliminated as part of a back room deal during conference negotiations. The budget also proposes to eliminate an extra $125,000 payment limit for peanuts and commodity certificates, both of which allow operations to circumvent the common sense payment limits supported by Congress.
When it comes to crop insurance reform, the budget proposal is largely a miss. Instead of applying thoughtful modernization reforms to premium subsidies, the budget takes a slash and burn approach, cutting premium subsidies for all farmers no matter the size of their operation. Such a heavy-handed approach threatens to unravel the farm safety net. NSAC recommends that the President focus instead on modernizing the federal crop insurance program by limiting taxpayer subsidies for the largest operations. The federal crop insurance program is critical to the strength of the farm safety net, but it needs to be modernized so that it is more efficient, effective, and works for all types and sizes of farm operations.
Additionally, the budget proposes to reduce premium subsides on policies with the Harvest Price Option (HPO) by 15 percentage points and by 10 percentage points for policies without HPO. HPO is the additional policy that allows farmers to choose whether to use the projected price or the harvest price to determine their indemnity, thus allowing them to hedge with little risk. This proposed change, unfortunately, will do nothing to stop the largest farms from leveraging unlimited crop insurance subsidies to outbid mid-scale and beginning farmers for scarce farmland.
Finally, the budget proposes to cap underwriting gains by crop insurance companies, lower the target rate of return, and limit eligibility for crop insurance for those with and Adjusted Gross Income over $500,000.
What Happens Next?
The President’s budget proposal is important because it sets the tone for the forthcoming budget and appropriations debates in Congress. Given that this is a farm bill year, the President’s budget proposal is especially important because of its potential to influence our most significant package of food and farm legislation.
Fortunately, the President’s budget proposal is just that – a proposal. Congressional appropriators are under no obligation to take all or even part of the President’s recommendations. In fact, as a result of a recently agreed to two-year budget deal, appropriators now have an additional $68 billion to spend in FY 2019, on top of the previously established spending cap.
In the coming weeks, the House Agriculture Appropriations Committee will host a hearing wherein USDA Secretary Sonny Perdue will have the chance to give his views on the President’s budget proposal. This hearing will effectively mark the kick-off of the congressional appropriations process for FY 2019.
As the FY 2018 appropriations cycle wraps up, and the FY 2019 cycle begins, NSAC will work with Congress to ensure that we build upon rather than undermine successful investments in food and agriculture programs.
Stay tuned to the NSAC blog for more updates and analysis as process unfolds.