CONTRIBUTING to deficit reduction continues to be the cornerstone of passing a five-year farm bill this year.
However, updated estimates from the Congressional Budget Office (CBO) of last year's House and Senate farm bill proposals show that funding for those same policies this year would be significantly smaller than in 2012 and could make writing and passing a farm bill even more difficult in the tight budgetary environment.
During a House Agriculture Committee hearing on the state of the rural economy March 5, ranking member Rep. Collin Peterson (D., Minn.) said it was unfortunate that a new farm bill did not get passed, but moving forward, assurances need to be made on what baseline is expected to reduce overlays.
Peterson told Agriculture Secretary Tom Vilsack, who was the only one questioned during the hearing, that if Vilsack, Speaker of the House John Boehner (R., Ohio) and Sen. Harry Reid (D., Nev.) could come up with a specific number for budget reduction as well as what each body hopes to do with the Supplemental Nutritional Assistance Program, it would be "relatively easy to get things done."
CBO now estimates that the Senate's version of the farm bill, which was passed by the full Senate last summer and has been reintroduced in the 113th Congress, would provide only $13.1 billion in savings compared to last year's touted $23.1 billion.
According to CBO, spending on commodity programs under Title I of the legislation would cost $3.8 billion more over the next 10 years because "recent higher commodity prices increase the expected cost of the income guarantees in the Agriculture Risk Coverage Program offered under the legislation; lower milk prices increase the cost of the Margin Protection Program for dairy producers, and it is now clear that the recent drought conditions will increase the estimated cost of the livestock disaster assistance program benefits for 2012 and 2013."
The House farm bill was originally projected to save $35.1 billion over the 2013-22 period, but the updated CBO figures downgraded the total savings to $26.6 billion. Changes in the commodity title would cost $1.1 billion more over the next 10 years for the same reasons given for the Senate version.
CBO also estimated an additional $1.4 billion in spending for crop insurance because of expected increased participation in the price loss coverage option offered in the House version that makes more producers eligible for benefits under its supplemental coverage option.
In both the House and Senate versions, CBO scored nutrition costs $4.4 billion higher than last year primarily because of a change in how the U.S. Department of Agriculture interprets utility allowances.
Speaking March 2 in Piqua, Ohio, at his annual Farm Forum, Boehner said he remains "hopeful" that the House and Senate can agree on a farm bill and added that nutrition funding, not farm issues, was the "biggest impediment" during last year's debate.
Boehner explained that enrollment for food assistance has gone up significantly since 2009-10, and with that has come increased fraud.
With 80% of farm bill spending going to nutrition programs, it remains crucial to resolve that issue, but Boehner said he is "optimistic."
Boehner said there are 18 million more people on food stamps than four years ago. "This becomes a lower-the-eligibility requirement. It has to be addressed. We have money rolling out the door. American people don't mind seeing their hard-earned money being spent to provide a safety net, but they sure hate to see people take advantage of their hard-earned tax dollars," he said.
Boehner, who has taken heat for not allowing the farm bill to come up for a vote in 2012, said he didn't think the farm bill extension was a big issue, especially since many of the changes contemplated were not major, particularly in the commodity title.
Boehner, who spent 16 years on the House Agriculture Committee, said crop insurance will continue to be the central focus of the farm bill, despite attempts to weaken the program because of increasing costs.
"Whenever you have a big pot of money, you're going to have people come and try to steal it," he said, adding that he thinks "crop insurance is solid."