Understanding Appropriations: A Look at the House Appropriations Committee FY 2023 Agriculture Funding Bill
Understanding Appropriations: A Look at the House Appropriations Committee FY 2023 Agriculture Funding Bill
July 5, 2022
On June 23rd, the House Appropriations Committee marked up and approved its fiscal year (FY) 2023 Agriculture Spending bill. The full House Appropriations Committee markup and approval followed the Agriculture Subcommittee’s approval of the funding bill on Wednesday, June 15th. The agriculture appropriations bill includes funding for a wide range of farm and food programs, including conservation initiatives, beginning farmer and rancher training, and agricultural research.
For FY 2023, the bill provides discretionary funding of $27.2 billion – an increase of $2.075 billion, more than 8 percent above FY 2022 but slightly below President Biden’s Budget request of $28.5 billion, an increase of 17.1 percent above FY 2021 levels (excluding Food for Peace Title II Grants.).
The House Committee on Appropriations considered all 12 of the spending bills for FY 2023 and the next step is for the full House of Representatives to consider the combined spending package which usually happens later in the year. It is uncertain how the Senate appropriators intend to complete their work because for the past several budget cycles, they have not completed public consideration of their spending bills prior to entering into conference with the House where final spending levels are set. The agriculture funding bill is just one of the 12 total bills that appropriators must develop and pass every fiscal year, which unlike the calendar year, runs from October 1, 2022 – September 30, 2023. September 30, 2022 at midnight is the deadline by which Congress and the President must enact new spending legislation or a “continuing resolution” of current spending levels to prevent a government shutdown.
Unpacking the Bill Content
In this post, NSAC outlines highlights from the FY 2023 House Agriculture Appropriations bill as it pertains to the sustainable agriculture community. For a more comprehensive look at the programs and funding levels contained in the agriculture spending bill that NSAC tracks, check out our newly updated appropriations chart. Typically, bills are accompanied by official reports that help to explain the details of an appropriations bill and some of the related Congressional intent. The full bill text and accompanying report language can be found here. Issue areas covered in this analysis include:
- Climate and Conservation
- Research and Food Safety
- Local Food and Rural Development
- Farm Loans and Beginning and Socially Disadvantaged Producers
Climate and Conservation
Investing in mitigating and adapting to climate change was less obvious in press releases accompanying the FY 2023 Agriculture appropriations bill than with the FY 2022 bill but a careful review of the bill text shows significant climate related investments throughout. Much of that funding is in research programs (considered below) but it also appears in conservation programs. It includes, among other things, $25 million for ‘climate smart agriculture’ to continue the work of the Natural Resource Conservation Service (NRCS) begun with the Partnerships for Climate-Smart Commodities Climate, $2 million for the Risk Management Agency (RMA) to address climate risk, support for hiring small farmers specialists at FSA to address the climate and conservation needs of smaller, diversified producers, and a new mention of the importance of the role of organic production in meeting the challenge of the climate crisis. The appropriators also mention the importance of creating climate change-oriented practice bundles within the Conservation Stewardship Program (CSP) and recommends additional focus within the Environmental Quality Incentives Program (EQIP) on ‘regenerative agriculture’ practices to improve soil health.
In addition to climate specific investments the bill also proposes considerable increased funding for Conservation Technical Assistance (CTA). CTA is the backbone of USDA’s conservation programs. Through CTA, NRCS field staff work with farmers to develop and implement conservation plans to conserve resources on their farms and enroll in conservation programs. Robust CTA funding is essential to USDA efforts to combat climate change. The House bill funds CTA at $885.578 million, which is a $125.765 million increase over the FY 2022 enacted level – a welcomed increase. However, if agriculture is to reach net-zero greenhouse gas emissions, as part of the Biden plan to reach net-zero for the overall economy by 2050, such an increase will need to be sustained over the long run to ensure that producers have every tool to adopt more sustainable practices on their farms and ranches. We will need a sustained increase in CTA funding over many years, coupled with significant additional investment in NRCS conservation programs, if agriculture is to reach its targets and become net-zero.
Renewable energy development in rural communities is another important piece of the puzzle when it comes to mitigating and adapting to climate change and reaching the goal of net-zero by 2050. Unfortunately , the FY 2023 agriculture spending bill includes very little discretionary funding for the Rural Energy For America Program (REAP). REAP has mandatory funding of $50 million but is provided with only an additional $104 million in FY 2023, for both loans and grants combined, which is nearly $20 million less than was provided in FY 2022. REAP is heavily oversubscribed and while it may be that USDA will provide rural communities additional resources for solarization and efficiency retrofits through other COVID derived infrastructure funding, this shortfall certainly invites the question about the seriousness of the Committee’s efforts to assist farmers and ranchers to adopt more sustainable energy generation and efficient technology. In addition to the specific funding amounts for conservation and climate related investments, the bill contains some interesting report language (as follows) that will hopefully, if included in the final package that passes Congress, be helpful in efforts to use existing NRCS programs to address climate change:
Conservation Stewardship Program (CSP) Bundles —The Committee recognizes the important role the agriculture sector can play in the effort to mitigate the impacts of global climate change and understands CSP is well-positioned to enhance support for agricultural practices and systems with the greatest climate change adaptation and mitigation potential. The Committee encourages NRCS to create climate change mitigation bundles within CSP, as recommended in the Select Committee on the Climate Crisis June 2020 report. Climate change mitigation bundles should include practices that reduce agricultural greenhouse gas emissions, such as improved nutrient management, and practices that increase carbon sequestration and improve soil health, such as using cover crops, conservation tillage, diverse and resource conserving crop rotations, and advanced grazing management. Given the wide geographic variations in climate, rainfall, soil, and topography, the bundles should be region specific and provide flexibility, allowing bundles to be tailored to the needs and conditions of each operation.
Grazing Lands Conservation —The Committee recognizes the importance of collaborative technical assistance to help producers effectively manage grazing lands to protect water quality, improve soil health, sequester carbon in the soil, and increase resilience and producer profitability. The Committee directs NRCS to continuing supporting partnerships that provide grazing lands conservation technical services such as grazing planning, workshops and demonstrations, peer-to-peer education, workforce training, and producer outreach, including support for partnerships that address unique needs at the local, state, and regional level.
Research and Food Safety
The FY2023 agriculture appropriations bill includes a number of important increases to key agricultural research programs. One of the most exciting investments included in the FY 2023 bill from the standpoint of sustainable agriculture is the $50 million for the Sustainable Agriculture Research and Extension (SARE) program, a $5 million increase from FY 2022. SARE is the USDA’s flagship on-farm research program and only research grant program solely dedicated to sustainable agriculture and education. This funding level, while still below the full authorized amount of $60 million, will allow SARE’s farmer driven research to keep pace with the growing challenges farmers face in remaining profitable and resilient in the context of climate change.
The FY 2023 bill also proposes substantial increases to the Agriculture and Food Research Initiative (AFRI), the largest federal research program providing competitive grants to researchers to solve pressing challenges facing farmers and rural economies. The FY 2023 agriculture package provides AFRI with $500million, a $55 million increase relative to FY 2022 levels. The FY 2023 bill also includes $15 million for the Long-term Agroecological Research (LTAR) network, a constellation of Agricultural Research Service sites around the country dedicated to long term research on agroecological farming practices and systems and $5 million to strengthen the Regional Climate Hub research teams.
The report language that accompanies the bill also requests:
In addition, the Committee notes that projects that focus on researching enhanced rock weathering and biochar to quantify climate benefits….are also eligible for AFRI awards.
Organic Research.—The Committee looks forward to receiving the five year plan requested in House Report 117–82.
The Committee requests NIFA submit a report summarizing the type and focus of research awarded through AFRI over the past five years within 180 days of the enactment of this Act. This report should also outline ways the agency can improve program outreach and the regional diversity of AFRI awardees.
The Committee encourages NIFA to support Hispanic-serving agricultural colleges and universities agricultural worker training grants programs.
The Food Safety Outreach Program (FSOP), which funds food safety related outreach, education, training, and technical assistance projects that directly assist small- and mid-sized farms, beginning and socially disadvantaged farmers, small processors, and small-scale wholesalers, was provided flat funding of $10 million in the FY23 bill. The Organic Transitions (ORG) research program, which helps provide education and research support for transitioning organic farmers and livestock producers, is funded at $7 million in FY 2023, a reduction of $500,000 relative to FY 2022 though it is well understood that the Administration has pledged significant resources derived from COVID response funding legislation to bolster organic transition programs and research.
Local Food, Rural Development and Healthy Food Access
Local food, rural development, and healthy food access is another bright spot in the House FY 2023 agriculture spending bill.
The 2018 Farm Bill created the Local Agriculture Market Program (LAMP), a program championed by NSAC, which combined the Farmers Market and Local Food Promotion Program (FMLFPP) and the Value-Added Producers Grant Program (VAPG).
While it seems at first that the agriculture spending bill does not recognize the importance of these keystone local food and entrepreneurship programs and includes only level funding of $7.4 million in discretionary funds for FMLFPP and $13 million for VAPG in FY 2023, this must be seen against the backdrop of both the $50 million in mandatory funds and $130 million from the American Rescue Plan Act (ARPA) available for the Local Food Promotion Program and Regional Food System Partnership Grants. .
The agriculture spending package also includes $13.5million for the Office of Urban Agriculture and Innovative Forms of Production, a $5 million increase when compared to FY 2022. The Office and its associated programs and authorities were created in the 2018 Farm Bill.
In the more traditional rural economic development space, the agriculture bill contains less support for the Rural Microentrepreneur Assistance Program (RMAP). In the FY 2023 bill, RMAP is provided with only $6 million for grants and enough capital for $25 million worth of direct loans. Final appropriations for FY 2022 provided RMAP with $6.5 million for grants and capital sufficient to make $150 million in direct loans.
In addition to the specific funding allocations discussed above the spending bill included the following interesting and noteworthy report language:
Foods for Health. —The Committee recognizes USDA can do more to support local food producers and encourages efforts to increase local food purchases for hospitals, clinics, and health providers to support food prescription programs that provide medically tailored foods, including fresh fruits and vegetables, to patients for the prevention or management of diet-impacted health conditions and improvements in dietary health.
Local Food.—The Committee recognizes the growing demand for locally and regionally produced food. The Committee encourages all nutrition programs, to the extent feasible, to engage local agriculture producers to enhance small farmers and regional producers. The Committee again directs FNS to review its Child Nutrition Programs and other food distribution programs to determine how many of their commodity purchases are locally sourced and how to improve procurement from local and small farmers.
Local Food in the National School Lunch Program (NSLP). —The Committee is aware that school meals are a vital source of food and nutrition for elementary and secondary students. The Committee recognizes the NSLP could do more to support local economies and businesses through increased participation with local producers and encourages efforts to increase local food purchases for the NSLP sourced from in-state or geographically local growers and producers.
Farm Loans and Beginning and Socially Disadvantaged Producers
As part of overall Congressional efforts to address historic and current racial discrimination within USDA programs and policies, the FY 2023 agriculture spending bill contains a number of provisions related to socially disadvantaged producers and social justice. The spending bill includes $37,595 million for the USDA Office of Civil Rights, an increase of $2.2 million relative to FY 2022.
It also provides funding to improve outreach and program access to historically underserved communities through the Farming Opportunities, Training and Outreach (FOTO) program, which is an umbrella program for the Beginning Farmer and Rancher Development Program (BFRDP) and the Outreach and Assistance to Socially Disadvantaged and Veteran Farmers and Ranchers Program (aka “Section 2501”). For the first time, the appropriation bill addresses the need for greater information on the challenges and barriers faced by new and beginning farmers and ranchers as they seek to access land through the inclusion of this provision:
Tenure, Ownership, and Transition of Agricultural Land (TOTAL) Survey. —The Committee notes that the next TOTAL survey is part of planned NASS activities in the next Census of Agriculture. The Committee expects the next TOTAL survey to provide comprehensive data on land ownership, tenure, landowners’ transition plans, and lease agreements available to beginning and socially disadvantaged farmers to understand the trends that lead to secure land tenure and thriving farm businesses. The Committee encourages the program to look at emerging trends in land acquisition connected to innovations in farming on small acreage. The Committee also encourages collaboration with ERS so that new data provided on the economics of the farm of the future can be better utilized.
Access to credit is critical for farmers, particularly for those just beginning their careers and for producers not well served by the commercial lending sector. Farm Service Agency (FSA) loan programs fill the lending gap by providing financing for producers unable to secure credit from private lenders. For decades, these programs have increased access to credit for small- and mid-size family farms and for operations run by beginning, socially disadvantaged, and veteran farmers.
The FY 2023 bill largely maintains program levels for Guaranteed and Direct Operating loans, as well as for Guaranteed Farm Ownership loans with modest increases to Direct and Guaranteed Farm Ownership loans:
- Direct Operating Loans: $1.633 billion (flat relative to FY 2022)
- Direct Farm Ownership Loans: $3.1 billion ($400 million increase)
- Guaranteed Farm Ownership Loans: $3.5 billion (flat relative to FY 20212)
- Guaranteed Operating Loans: $2.118 billion (flat relative to FY 2022)
Next steps in the process
Now that the House Appropriations Committee has passed their FY 2023 agriculture spending bill, it will go to the full floor of the House for consideration by the full chamber though that will likely happen after the summer recess. The Senate Agriculture Appropriations Subcommittee has not yet released or marked up a bill and it is unclear when they will move forward. The Senate has not been particularly interested in issuing its own appropriations bills and has instead chosen to enter into conference with the House without public hearings on individual bills for the past two years.