The Farm Bill is more than Just Farming

The Farm Bill is again in the news this year, since a bill was not passed last year. The current bill we are operating under is the Food, Conservation and Energy Act of 2008 (2008 Farm Bill). The five year law expired on September 30, 2012. Congress was unable and/or unwilling to pass another Farm Bill before the expiration date. On January 2, 2013, President Obama signed into law the American Taxpayer Relief Act of 2012, which extended authority of the 2008 Farm Bill. It was a simple one year extension that is set to expire September 30, 2013.

The history of similar farm legislation began in 1933, a few days after President Franklin D. Roosevelt was inaugurated. Roosevelt called Congress into special session and introduced fifteen pieces of legislation, which included the Agricultural Adjustment Act (AAA). The idea was to balance supply and demand to allow decent purchasing power for farmers. In 1937, the Supreme Court ruled AAA unconstitutional. Soon thereafter the basic program was rewritten and passed into law. Since then various “Farm Bills” have been passed to extend agricultural related legislation.

The contents of the Farm Bill have changed some through the years mainly to gain and maintain urban legislator support. Trying to determine the exact amount of the Farm Bill is challenging. It is quite easy to find the U.S. Department of Agriculture (USDA) budget. The tough part is trying to extract out farm bill spending (mandatory by law), since there is additional mandatory spending (required through other laws) and discretionary (funds not designated by law) spending. The following content is from the 2012 USDA budget based on $145 billion. The following bar chart shows that 81% of the outlays are associated with mandatory spending (or $117 b) and 19% discretionary spending.

Most of the Farm Bill spending is for supplemental nutrition assistance spending (SNAP) (formerly called food stamps), commodity programs, crop insurance, conservation programs and energy. The Food and Nutrition Service (FNS) coordinates the food related programs. SNAP has over 45 million participants (2012) and funds of $75 b line itemed and an additional $11.9 b in Recovery Act funds, which likely are not part of the Farm Bill. The mandatory conservation programs administered through Natural Resources Conservation Service (NRCS) include: Environmental Quality Incentives Program (EQIP), Wetlands Reserve, Conservation Security Program, Conservation Stewardship Program, Farm and Ranch Lands Protection and others. Rural Development coordinates the mandatory funding for the energy pieces of the Farm Bill totaling about $178 m in 2012. The Farm Service Agency (FSA) supports delivery of farm credit, disaster assistance and commodity programs and some of the conservation programs. FSA also provides administrative support for the Commodity Credit Corporation (CCC) which funds most of the commodity, export and some conservation programs. Risk Management Agency (RMA) has mandatory funds to coordinate the crop insurance program.

The largest mandatory outlay, not part of the Farm Bill is the school lunch program, which is about $80 million/day (includes subsidies for every lunch and breakfast served, whether free or fully paid).

Discretionary programs include: Special Supplemental Nutrition Programs for Women, Infants and Children (WIC), Public Law 480 (mostly food sales/grants to developing countries), rural development loans and grants, research and education, soil & water conservation technical assistance, animal and plant health, management of national forests and a few other items.

Where is Extension in the tangled web called USDA budget? Extension is called National Institute of Food and Agriculture (NIFA) at the federal level. The mandatory funding (Farm Bill) totals $129 m, which is line itemed to six projects, the largest being Specialty Crop Research. The entire NIFA budget (mandatory plus discretionary) funding was $1.3 b, or 0.90% of the USDA budget.

In summary, there are many programs funded through the Farm Bill related to food, agricultural production, conservation and energy. It takes time to learn about the programs and how the funding works. The goal of the farm bill is to provide an abundant safe food supply and to make sure all people have access to adequate healthy foods. We will continue to hear much discussion as the next farm bill develops. Just remember whatever becomes law will affect our local areas.

(Sources: USDA FY 2012 Budget Summary and MU Food and Agricultural Policy Research Institute [FAPRI])
by Mary Sobba, MU Extension Ag. Business Mgmt. Specialist