Proposed FY2015 budget cuts crop insurance

Cattle and Beef Industry News
Mar 10, 2014

Each year the president takes time to send Congress a budget proposal, along with a long list of potential policy changes, marking the beginning of the year’s long political debate to finalize the plans for the appropriations bill for the next fiscal year. President Barack Obama released his fiscal year (FY) 2015 proposal last week, with a press release that reads a bit like an advertisement for a U.S. tourist attraction, but there is one key component that is clearly going to be at the core of many discussions before the budget is finalized—agriculture.

Secretary of the Interior Sally Jewell announced the budget request of $11.9 billion, up 2.4 percent from 2014, for the Department of the Interior, saying it makes “key investments to maintain vital funding for Interior’s missions, in landscape-level conservation, balanced energy development, water management, engaging youth and veterans, addressing climate change, fulfilling commitments to American Indians and Alaska Native Tribes and insular communities.”

Just when we thought the farm bill discussions were over, President Obama in his FY 2015 budget proposal listed plans to cut the federal crop insurance assistance by $14 billion over 10 years. Just last month Congress passed a fiveyear farm bill ending the government’s system of direct payments to farmers and reinforcing the crop insurance portion.

“These proposals will modify the structure of the crop insurance program so that it is less costly to the taxpayer yet still provides a quality safety net for farmers,” the budget proposal said.

The current proposal is for $158 billion for FY2015. The administration argues that reduced crop and insurance subsidies in the administration’s proposal would cut discretionary spending from $24 billion in 2014 to $23 billion for the budget year.

While the crop insurance was on the chopping block, the president was eyeing more money for research, school nutrition and honey bees. With $75 million proposed for three new multidisciplinary agricultural research institutes dedicated to crop science and pollinator health and $50 million to support research on honey bees, whose populations have declined in recent years, this is destined for controversy.

Firefighting will also likely be a topic of interest in coming budget discussions. With more than 200 million acres of forest and grassland to care for, the proposal recommends new management plans, allowing the Forest Service and the Department of the Interior to tap disaster money from the Federal Emergency Management Agency and reduce borrowing from internal forest management accounts.

The 2015 budget proposes to amend the Balanced Budget and Emergency Deficit Control Act of 1985, to establish a new budget framework for the Wildland Fire Management program to provide stable funding for fire suppression, while minimizing the adverse impacts of fire transfers on other fire

and non-fire programs, as well as reduce fire risk, manage landscapes more comprehensively, and increase the resiliency of public lands and the communities that border them. In this proposed new budget framework, $268.6 million of the funding needed for suppression response is funded within the discretionary spending limits and $240.4 million is funded as an adjustment.

“So, there are plenty of controversial items in the budget to keep the press occupied through much of the year. For example, the proposal would cut $9.3 million from the Food Safety and Inspection Service from 2014 enacted levels for inspecting meat, poultry and egg products. The cuts are to be made possible by a new, science-based inspection process that USDA says it has spent 10 years developing. Agriculture Secretary Tom Vilsack argues this would update a poultry inspection system “that hasn’t changed in 60 years.” Observers note that “The proposal is extremely controversial among some USDA employees and consumer advocacy groups,” DTN’s Washington insider wrote.

The Obama administration also proposed providing stepped-up funding for grants to provide high speed Internet access to rural communities and allocating $58 million for a new economic development program meant to create new jobs in rural communities.

“The budget enables Interior to carry out its important missions and contains key proposals to uphold our trust responsibilities to American Indians and Alaska Natives, provide a new approach for responsibly budgeting for wildland fire suppression needs, invest in climate resilience, and bolster our national parks and public lands in advance of the National Park Service’s 100th anniversary in 2016. Importantly, the president continues to support full, permanent funding for the Land and Water Conservation Fund, one of the nation’s most effective tools for expanding access for hunting and fishing, creating ball fields and other places for children to play and learn, and protecting Civil War battlefields,” Secretary Jewell said.

The budget plan for national parks and public land areas is likely to raise a few agricultural eyebrows. The 2015 budget touts plans to upgrade and restore national parks and other public land areas, while engaging thousands of youth, veterans and others.

“The budget strengthens the president’s commitment to the America’s Great Outdoors initiative with a request of $5.1 billion in current funding for programs that include: operations of public land management units; the Land and Water Conservation Fund; and grants to states and others. This is an increase of $127.1 million compared to the 2014 enacted level,” the release reads.

The 2015 budget addressed water concerns amidst California’s drought crisis. The 2015 budget requests $1 billion for the Bureau of Reclamation, which manages 476 dams and 337 reservoirs that deliver water to 31 million people. The budget also requests $210 million for the U.S. Geological Survey’s water programs, which provide scientific monitoring, research, and tools to support water management across the nation.

The budget includes $66.5 million for WaterSMART programs, nearly a 17 percent increase from 2014, to assist communities in stretching water supplies and improving water management. This funding supports the department’s goal to increase by 840,000 acrefeet the available water supply for agricultural, municipal, industrial and environmental uses in the Western United States through water conservation programs by the end of 2015.

Interior extends this commitment to Indian Country, honoring Indian water settlements with investments totaling $172 million for technical and legal support and water settlements. This includes $147.6 million to bring reliable and potable water to Indian communities, more than a 9 percent increase from 2014. Among the investments is $90 million for the ongoing Navajo- Gallup Water Supply Project, which, when completed, will have the capacity to deliver clean running water to a potential future population of approximately 250,000.

The president’s budget request for climate change and air quality of $1.03 billion, a $41 million increase compared to FY 2014 enacted levels, includes $199.5 million to address what the administration considers one of the greatest challenges of this generation and generations to come—climate change. In addition to the efforts within base resources that support the implementation of the president’s Climate Action Plan, the FY 2015 request provides an additional $10 million and 24 staff.

Giving the Environmental Protection Agency the reins, the FY 2015 resources will support the development of “achievable greenhouse gas (GHG) standards, regulations, or guidelines, as appropriate, for modified, reconstructed, and existing power plants.” The president’s budget also provides additional support for the states to help them implement the Clean Air Act, as it relates with regard to cutting greenhouse gas emissions. Resources also will support developing and implementing the president’s inter-agency methane strategy to mitigate climate change impacts.

In FY 2015, Heavy Duty Vehicle GHG Phase 2 standards will require upgrades to the National Vehicle Fuel Emissions Laboratory (NVFEL), which is responsible for ensuring vehicles meet national MPG and emissions standards. The EPA also is implementing a range of activities in support of the president’s call to cut energy waste in homes, businesses, and factories, including Energy Star’s efforts to increase energy efficiency in multi-family housing.

An earmarked $2 million will provide technical assistance and support tools for climate change adaptation planning. This includes technical assistance for water utilities at greatest risk from storm surges. Research and development efforts will focus on decision support tools for at-risk communities and tribes to help them build resiliency to the effects of climate change.

Secretary Vilsack praised the proposed FY 2015 budget in a released statement:

“The president’s 2015 USDA budget proposal achieves reform and results for the American taxpayer; fosters opportunity for the men and women living, working and raising families in rural America; and supports innovation through strategic, future-focused investments.

“The budget focuses on creating jobs and building a foundation for future economic growth, particularly in rural America, where 85 percent of our nation’s persistent poverty counties are located. It supports farmers, ranchers and growers as they achieve net farm income well above the average of the previous decade. Midsized farms and livestock producers continue to face challenges as a result of prolonged drought. We are hopeful that implementation of the 2014 farm bill, which restores disaster assistance and invests in programs to help beginning, small and socially disadvantaged farmers and ranchers, will provide much needed stability for producers moving forward.”

The budget is online at — Traci Eatherton, WLJ Editor