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1 1 (July 8, 2024)

handle is hein.crs/govepol0001 and id is 1 raw text is: Congressional Research Service informing the leg sIatve debate sn ne 1914 Farm Bill Primer: Budget Dynamics Updated July 8, 2024 Congress is considering a new farm bill because provisions in the 2018 farm bill (P.L. 115-334) began expiring at the end of FY2023 (CRS Report R47659, Expiration of the 2018 Farm Bill and Extension in 2024). In November 2023, Congress enacted a one-year extension for FY2024 and the crop year 2024 (P.L. 118-22, Division B, §102). On May 23, 2024, the House Committee on Agriculture passed H.R. 8467. The Senate Committee on Agriculture, Nutrition, and Forestry has not released bill text for a farm bill. Farm Bills from a ud get Perspect ve Federal spending for agriculture is divided into two main categories-mandatory and discretionary spending: * Mandatory spending is authorized primarily for the farm commodity programs, conservation, crop insurance, and the nutrition assistance programs. A farm bill authorizes outlays for mandatory programs when the law is enacted. * Discretionary appropriations are authorized for most other programs, including rural development, research, and credit programs. Farm bills set program parameters. Funding may be provided in appropriations acts. Some farm bill programs have received both types of funding. Discretionary appropriations are the primary source for many programs, but mandatory spending usually dominates the farm bill budget debate and is the focus here. Importance of ase ne to the Farm The Congressional Budget Office (CBO) baseline is a projection at a particular point in time of what future federal mandatory spending would be under the assumption that current law continues. The baseline is the benchmark against which proposed changes in law are measured. When a bill is proposed that would affect mandatory spending, the score (cost impact) is measured in relation to the baseline. Changes that increase spending relative to the baseline have a positive score; those that decrease spending relative to the baseline have a negative score. Increases in a bill's total cost beyond the baseline may be subject to budget constraints, such as pay-as-you-go (PAYGO) rules. Reductions from the baseline may be used to offset costs for other provisions that have a positive score or used to reduce the federal deficit. The annual budget resolution determines whether a farm bill is held budget neutral or can increase or must decrease spending. Recent Farm Bis' Budget Positions Over the past two decades, farm bills have had both positive and negative scores relative to their baselines. The 2002 farm bill had a positive score and increased spending by $73 billion over 10 years under a budget resolution during a budget surplus. The 2008 farm bill was budget neutral, although it added $9 billion to outlays over 10 years by using offsets from a tax-related title. The 2014 farm bill had a negative score, reducing spending by $16 billion over 10 years. The 2018 farm bill was budget neutral with increases in some titles offset by reductions in others. CBO's June 2024 Baseline In June 2024, CBO released a new baseline that updates spending projections. It is the scoring baseline for the remainder of the 118th Congress, though the House Committee-passed farm bill markup of H.R. 8467 in May 2024 reportedly used the May 2023 baseline. Farm bills have 5-year and 10-year budget projections according to federal budgeting practices. Converting the baseline into farm bill titles and adding funding indicated in law for other farm bill programs, CRS estimates that the baseline for all farm bill titles is $662 billion over 5 years (FY2025-FY2029) and $1,364 billion over 10 years (FY2025-FY2034) (Figure 1). For the individual non-nutrition agricultural programs with baseline, current projections are for $265 billion of outlays over the next 10 years (Figure 2). Figure I. Farm Bill Titles with Mandatory Baseline (billions of dollars, 10-year projected outlays, FY2025-FY2034) Commodi o(ties, $73 Conservation, $58 Source: Created by CRS using the Congressional Budget Office (CBO) June 2024 baseline for the five largest titles and amounts indicated in law for programs in other titles. Extension of the Farm Bill in 2024 The one-year extension of the farm bill covers FY2024 and the 2024 crop year. It authorizes the continuation of programs with a mandatory spending baseline and provides one year of new mandatory funding for some programs that Total: $1,364 billion Crop Insurance, $123

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