President Bush presented his proposed FY 2007 Federal budget to Congress on Monday February 6th. The President’s budget proposal represents the starting point from which Congress will develop next year’s federal budget. USDA Secretary Mike Johanns issued a press release examining the impact of the budget proposal on the Agriculture Department.
According to information provided in the USDA press release, the total USDA expenditures for 2007 are estimated to be approximately $93 billion. This represents a $3 billion decline from the FY 2006 budget. Roughly 77% of the expenditures are for mandatory programs required by law. The remaining 23% fund discretionary programs such as the Women, Infants and Children (WIC) program; rural development loans and grants; research and education; soil and water conservation technical assistance; management of National Forests and domestic marketing assistance.
Budget highlights impacting USDA include:
- Avian influenza: $82 million to continue the efforts to improve preparedness and response capabilities in the event of an avian influenza outbreak. Congress appropriated $91 million in FY ’06, including $66 million in emergency funding, to initiate preparedness efforts.
- Food and Agriculture Defense Initiative: The budget proposes $322 million in USDA funding for the multi-agency Food and Agriculture Defense Initiative, which is funded at nearly $540 million government-wide.
- Energy Initiatives: USDA’s core investment in energy-related projects increases to $85 million from $67 million in 2006.
- Commodity Credit Corporation: Net CCC expenditures were over $20 billion in 2005 and are projected to exceed $21 billion in 2006 before coming down to around $19 billion in 2007. Reductions in CCC expenditures resulting from proposed legislative changes will produce savings of about $1 billion in 2007. Elements of the proposed changes include: lowering the payment limit cap for individuals to $250,000 for commodity payments, including all types of marketing loan gains; reducing crop and dairy payments to farmers by 5 percent, requiring the dairy price-support program to minimize expenditures; and imposing a sugar marketing assessment to be paid by sugar processors on all processed sugar and implementing a small assessment on milk marketed by producers.
- Crop Insurance: Net expenditures for crop insurance have grown nearly 50 percent between 2001 and 2007 with the implementation of the crop insurance reforms of 2000. Proposals include a higher minimum coverage level, tying the receipt of commodity payments to purchase of crop insurance and changes in fees, premium rates and delivery expenses. The combination of changes being proposed is expected to save approximately $140 million per year beginning in 2008, which is identical to the FY 2006 proposal.
- Domestic Nutrition Assistance Participation and Funding: The budget fully funds the expected requirements for USDA’s three major nutrition assistance programs -Food Stamps, School Lunch and WIC, which combined account for nearly $55 billion.
- Farm Bill Conservation Program Funding and Program Enrollment: The budget proposes over $4 billion to continue implementation of the conservation programs authorized in the 2002 Farm Bill and support the enrollment of an additional 23 million acres, mostly through EQIP.
- Healthy Forests: The budget continues implementation of the President’s Healthy Forests Initiative to mitigate the threat of catastrophic wildfires. The budget also includes $1.8 billion to protect communities and natural resources from wildland fire and provides for sustainable forests and communities through full funding of the Northwest Forest Plan and extension of Payments to States legislation.
More details regarding these programs or other aspects of the President’s budget can be obtained by viewing Sec. Johanns’ press release or visiting the USDA website .