June 2023
There has been a lot of smoke in Washington over the past month – both literally and figuratively. For most of May, Congress was bogged down due to intense and painstaking negotiations over the debt ceiling. Coverage of the negotiations featured a significant amount of “smoke”– with both sides portraying the negotiations as difficult and unproductive, all while slow but steady progress was being made behind closed doors.
Despite the resolution to the standoff, plenty of smoke remains (literally). Washington is currently choked by wildfire smoke being pushed down from Canada to the point that simply being outdoors is considered “hazardous.”
Where there’s smoke, there’s fire. And Congress and the Biden Administration were certainly burning the midnight oil to come to an agreement on the debt ceiling. We are hopeful the smoke dissipates before the Farm Bill expires and lawmakers can soon make progress on important legislation.
PRESIDENT BIDEN SIGNS BILL TO RAISE DEBT CEILING, AVERT DEFAULT
On May 28, President Biden and Speaker McCarthy announced an agreement to resolve the months-long impasse over the impending debt ceiling. In mid-January, the U.S. officially hit the debt ceiling, which prevents the federal government from borrowing money to pay down existing debt. U.S. Treasury Secretary Janet Yellen announced “extraordinary measures” to enable the federal government to continue paying its financial obligations but warned such measures would be exhausted by early June.
In March, President Biden released his budget proposal to Congress, which increased both defense and non-defense spending levels and proposed new revenues from high-income households and corporations. This proposal was quickly rejected by House Republicans. President Biden refused to negotiate on the debt ceiling with Speaker McCarthy, insisting on a clean debt-ceiling increase without conditions. After months of wrangling, the House GOP narrowly passed their own debt limit bill in late-April, which proposed federal spending cuts of nearly 14 percent over the next decade, including major cuts to clean energy spending from the Inflation Reduction Act (IRA) and strict work requirements for participants of the Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF), essential food assistance and anti-poverty programs.
With both sides taking action, President Biden and Speaker McCarthy finally came together to begin negotiations. Initial meetings were rocky, with little progress being reported and talks “breaking down.” President Biden even had to cut short his attendance at the G-7 Summit in Japan to return to Washington, as the deadline approached. However, talks began to progress in the final weeks of May.
The deal was struck the Sunday of Memorial Day weekend. The agreement provides a roadmap for federal spending for the next decade, with two years of hard spending caps, followed by four years of non-binding spending targets. In exchange for suspending the debt limit until January 2025, the deal freezes fiscal year (FY) 2024 federal spending at FY 2023 levels, and caps FY 2025 spending levels at 1% growth.
Republicans demanded a decade of statutory spending caps but settled for two years of binding caps and four years of non-binding targets. The deal also imposes and expands existing work requirements for certain recipients of SNAP and TANF. Democrats were able to keep the climate and clean energy spending provisions and tax credits in the IRA largely intact.
Many observers looked to the debt ceiling standoff as an indicator for the farm bill process. The deal resulted in mixed feelings among Republicans and Democrats alike. Even with increases in work requirements for certain SNAP recipients, new exemptions for veterans, homeless individuals and families, and young adults who recently left foster care will result in a net increase in SNAP spending, per the Congressional Budget Office.
Other funding considerations are also complicating the farm bill situation. Rescissions of funding that were authorized but not yet spent will cut about $3.2 billion from USDA programs. This includes nearly $400 million from the Dairy Donation Program, which likely could have been repurposed for the farm bill.
NFU OPPOSES FY24 APPROPRIATIONS BILL
On May 18, NFU stated opposition to passage of the fiscal year 2024 agriculture funding bill as passed by the U.S. House Appropriations agriculture subcommittee. The bill includes several harmful provisions and funding cuts, including language preventing USDA from completing ongoing and forthcoming rulemakings to modernize and strengthen the Packers and Stockyards Act (P&S Act).
The bill also includes several other harmful provisions, including:
- Cutting funds that would support distressed borrowers of Farm Service Agency loans.
- Rolling back funding for programs that help address climate change and promote the growth of renewable energy on farms and ranches.
- Tightening requirements for low-income individuals to qualify for SNAP (in addition to the new requirements from the debt ceiling deal).
The P&S Act rulemakings would provide clearer protection for producers of livestock and poultry, clarify what conduct or actions by meatpackers violates the P&S Act (including by making clear what constitutes deceptive and retaliatory conduct by meatpackers), require poultry companies to be more transparent in their contracting practices with producers, and would settle the issue that individual farmers that are harmed do not need to prove competitive injury to the entire sector (whether cattle, hogs, poultry, or otherwise) in order to bring a case under the P&S Act.
NFU has advocated for modernizing and strengthening the P&S Act for decades and has contended with similar harmful provisions instituted through the appropriations process before. The Obama-era P&S Act rulemakings were hampered through the FY 2012-15 appropriations bills. When NFU and allies won the victory to lift those appropriations riders, the Obama administration did not have sufficient time to successfully finalize most of its proposed P&S Act rules.
NFU will work to ensure these harmful provisions are not part of the final House bill and similarly harmful provisions are not included in the Senate agriculture appropriations bill.
FARM BILL FOCUS: NFU CHAMPIONS FARMERS FIRST ACT
In mid-May, Sens. Tammy Baldwin (D-WI) and Joni Ernst (R-IA) introduced the Farmers First Act of 2023, which reauthorizes and increases funding for the Farm and Ranch Stress Assistance Network (FRSAN). FRSAN was first authorized in the 2008 Farm Bill but did not receive funding from Congress until 2019. The Farmers First Act increases annual funding for FRSAN from the current level of $10 million to $15 million for fiscal years 2024-2028.
FRSAN supports a service provider network that connects farm and ranch families to stress assistance programs and resources. Four regional centers established through FRSAN are increasing access to farm stress services across the United States and its territories by coordinating efforts to serve the unique needs of the populations in each region. Services provided and coordinated through FRSAN include telephone helplines and websites, training programs and workshops, support groups, and outreach services.
Farming is an inherently stressful occupation, with persistent financial pressure, falling commodity prices, climate change, and lingering effects from the Covid-19 pandemic hitting rural America particularly hard. Sixty percent of rural residents live in areas with professional health shortages, according to the Health Resources and Services Administration. FRSAN is essential for serving populations where the need is great, and resources are limited.
The bill is cosponsored by Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI), Ranking Member John Boozman (R-AR), Sens. Jon Tester (D-MT), Tina Smith (D-MN), Jerry Moran (R-KS), Michael Bennet (D-CO), and Susan Collins (R-ME). NFU will push for its inclusion in the 2023 Farm Bill.