Agriculture and the FY2005 Budget Resolution
Ralph M. Chite
During March 2004, the House and Senate completed action on their respective versions of the FY2005 budget resolution (H.Con.Res. 393 and S.Con.Res. 95), both of which contain provisions that address agricultural spending levels in the coming years. Conference committee action is pending. The budget resolution, which does not require Presidential approval, provides a blueprint for all federal revenues and spending over a multi-year period. It establishes how much in total is available for all discretionary government spending for the coming fiscal year, which is subsequently allocated by the appropriations committees among its 13 subcommittees. Budget resolutions also periodically contain reconciliation instructions to authorizing committees requiring them to report legislation to reduce spending on mandatory programs under the committees' jurisdiction.
The original House-passed version of the FY2005 budget resolution (H.Con.Res. 393) contained reconciliation instructions to several committees, including the House Agriculture Committee. However, the conference agreement on the resolution (H.Rept. 108-498), which was approved by the House and is still pending in the Senate, does not contain any reconciliation instructions for agriculture. If the original House language had been adopted, it would have required the House Agriculture Committee to reduce outlays on mandatory USDA programs by $110 million in FY2005 and $371 million over a five-year period (FY2005-09). The Agriculture Committee then would have been required to submit to the House Budget Committee by July 15, 2004, its recommendations for reducing waste, fraud, and abuse within the programs under its jurisdiction to achieve the required one-year and five-year savings. The House Budget Committee then would have reported legislation based on these recommendations. The proposed $110 million reduction for FY2005 was less than 1 percent of total estimated spending of $18.5 billion for mandatory agricultural spending (farm commodity support, conservation and crop insurance). Many farm groups expressed concern that required reductions of any magnitude to agriculture programs would lead to a reopening of the 2002 farm bill (P.L. 107-171), which authorizes these programs through 2007.
The original Senate-passed version of the FY2005 budget resolution (S.Con.Res. 95) assumed the adoption of a payment limit on farm commodity price and income support programs that would have reduced commodity support spending by an estimated $1.22 billion in FY2005. It also assumed that all of the estimated savings generated by payment limits would be allocated to increased funding for mandatory conservation ($531 million), rural development ($24.5 million), and food and nutrition ($665.5 million) spending. However, these recommendations would not have been binding, since it entailed no net change in spending for mandatory programs under the jurisdiction of the Senate Agriculture Committee. Also, there were no reconciliation instructions given to the Agriculture Committee. Hence, the original Senate budget resolution had no enforcement mechanism to require the Committee to make reductions to programs under its jurisdiction.
Additional Resources
FY2005 Budget Views and Estimates Letters to the Budget Committees:
House Agriculture Committee Letter
Senate Agriculture Committee LetterCRS Report RL32301, Appropriations for FY2005: U.S. Department of Agriculture and Related Agencies.
CRS Electronic Briefing Book on Agriculture, Updated 2002 Farm Bill Cost Estimates.
CRS Contact: Ralph M. Chite (7-7296)
Page last updated July 8, 2004.
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