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Tougher decisions coming for ag spending

DANIEL LOOKER 04/12/2011 @ 8:44pm Business Editor

The compromise bill that averted a government shutdown and trimmed nearly $40 billion from federal spending this year included about $3 billion in cuts to USDA programs.

But if there’s one thing agricultural lenders in both parties agree on, even tougher choices lie ahead as the House and Senate write a new farm bill next year.

House Agriculture Committee Chairman Frank Lucas (R-OK) told members of North American Agricultural Journalists in Washington Tuesday that if farmers in his district had a choice, they would just change the date on the 2008 Farm Bill and continue it as the 2012 Farm Bill.

“That’s not going to be possible,” Lucas said. Even before the House started trimming the budget this year, farm $4 billion of those cuts targeted for deficit reduction by the Obama Administration.

Altogether, the programs under the control of the Agriculture Committee will have a shortfall of $8 billion to $9 billion, Lucas estimated, “so this committee will get to make  some really tough choices.”

The committee’s ranking member, Collin Peterson (D-MN) said that the budget goals outlined by House Budget Committee Chairman Paul Ryan (R-WI) for 2012 and the next 10 years are so draconian that the Senate is unlikely to go along with them.

“What they are doing with these numbers, I don’t think is realistic at all,” Peterson said.  His own preference is to wait for the Senate to write a farm bill first.

Lucas also wants to delay the House Ag Committee’s work on the bill for other reasons, pointing out that about half of the members of his committee are new and that they need more time to learn about the farm bill and how USDA operates. And, Lucas hopes that the economy will be stronger next year, which might give Congress more money to work with.

The farm bill authorizes two types of spending, mandatory programs that include commodity programs like direct payments, and discretionary spending that has to be approved by appropriations committees each year and is often reduced or unfunded.

Peterson’s estimates of the budget deal is based on cuts in the budget agreement that include trimming mandatory programs, so they don’t match exactly with the cuts announced by the House Appropriations Committee this week.

According to Peterson, they would cut EQIP spending $350 million this year.

Total spending on Conservation programs would total $890 million (not a cut of about $800 million as reported earlier). That’s down from just over $1 billion budgeted for 2010.

Here is a narrative summary of the final agreement released by the Senate Budget Committee Tuesday.

And this is a table of dollar amounts released by the House Appropriations Committee.

According to Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI), the USDA spending cuts of $3 billion mean a reduction of about 14% in USDA spending this year. That’s less than more than $5 billion and over 20% in cuts passed by the first version of the House’s 2011 budget (technically a continuing resolution) in February.

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