Order Code RL31301
Report for Congress
Received through the CRS Web
Appropriations for FY2003:
U.S. Department of Agriculture
and Related Agencies
Updated August 27, 2002
Ralph M. Chite, Coordinator
Specialist in Agricultural Policy
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress
Appropriations are one part of a complex federal budget process that includes budget
resolutions, appropriations (regular, supplemental, and continuing) bills, rescissions, and
budget reconciliation bills. The process begins with the President’s budget request and is
bounded by the rules of the House and Senate, the Congressional Budget and Impoundment
Control Act of 1974 (as amended), the Budget Enforcement Act of 1990, and current
program authorizations.
This report is a guide to one of the 13 regular appropriations bills that Congress passes each
year. It is designed to supplement the information provided by the House and Senate
Appropriations Subcommittees on Agriculture. It summarizes the current legislative status
of the bill, its scope, major issues, funding levels, and related legislative activity. The report
lists the key CRS staff relevant to the issues covered and related CRS products.
NOTE: A Web version of this document with active links is
available to congressional staff at:
[http://www.crs.gov/products/appropriations/apppage.sht
ml].
Appropriations for FY2003:
U.S. Department of Agriculture and Related Agencies
Summary
The House and Senate Appropriations Committees have completed action on
their respective versions of the FY2003 appropriations bill for the U.S. Department
of Agriculture and related agencies. Floor action on the measures is expected in
September. The House measure (H.R. 5263, H.Rept. 107-623) contains total funding
of $74.306 billion, which is $355 million below the $74.661 billion provided in the
Senate reported bill (S. 2801, S.Rept. 107-223). Both measures are above the
Administration’s FY2003 request of $74.064 billion, and the FY2002 enacted level
of $73.622 billion (including supplementals). Of the total provided in the bills,
$17.601 billion is for discretionary programs in H.R. 5263 and $17.98 billion in S.
2801, compared with the Administration request of $17.421 billion.
Among their common elements, both the House- and Senate-reported bills: 1)
reject an Administration proposal to eliminate funding for three ongoing watershed
programs and replaces them with regular funding for the Emergency Watershed
Program; 2) fund special research grants proposed to be terminated by the
Administration, and eliminate funding for a mandatory research program; 3)
expresses concern over an Administration proposal to reduce mandatory foreign food
aid spending; 4) increase funding over FY2002 for food safety and animal and plant
health inspection activities reflecting increased government responsibility to protect
the food supply from terrorist attacks; and 5) increase USDA food and nutrition
program spending by $4 billion over FY2002, in line with the Administration
request, including $3.2 billion more for the food stamp program.
Managers of the two bills fended off attempts to use the FY2003 agriculture
appropriations bill as a vehicle for modifying the recently enacted 2002 farm bill
(P.L. 107-171), which established federal farm policy for the next 6 years. Although
no major changes were adopted in either appropriations committee, separate floor
amendments to H.R. 5263 and S. 2801 are expected to be offered that would modify
farm commodity program payment limits and change the structure and business
methods of the livestock industry. Additionally, members who support the sale of
U.S. agricultural products to Cuba might offer amendments to relax specific
prohibitions included in current law
Separately, on August 2, 2002, the President signed into law a supplemental
FY2002 funding measure (P.L. 107-206) that will provide additional funds primarily
for the ongoing war against terrorism. Of the $28.9 billion in the act, $5.1 billion was
provided contingent upon the President submitting within 30 days of enactment a
formal request for the funds and declaring a budget emergency for the new spending,
which the President has indicated he will not do. Within the bill total, approximately
$377 million in supplemental funding is for USDA and related agencies. However,
$165 million of the $377 million is designated as a contingent appropriation and will
not be provided without the President’s consent. A multi-billion dollar supplemental
crop and livestock disaster assistance package, not included in P.L. 107-206, might
be considered as a floor amendment to the FY2003 agriculture appropriations bill.


Key Policy Staff
CRS
Area of Expertise
Name
Division
Telephone
USDA Budget/Farm Spending and Coordinator Ralph M. Chite
RSI
7-7296
Conservation
Jeffrey A. Zinn
RSI
7-7257
Agricultural Trade and Food Aid
Charles E. Hanrahan
RSI
7-7235
Cuban Agricultural Trade
Remy Jurenas
RSI
7-7281
Rural Development
Tadlock Cowan
RSI
7-7600
Domestic Food Assistance
Jean Yavis Jones
RSI
7-7331
Agricultural Research and Food Safety
Jean M. Rawson
RSI
7-7283
USDA Marketing and Regulatory Programs
Alejandro Segarra
RSI
7-9664
Food and Drug Administration
Donna U. Vogt
DSP
7-7285
B. Randall
DSP
7-7046
Division abbreviations: RSI = Resources, Science and Industry; DSP= Domestic Social Policy.
Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
USDA Spending at a Glance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Mandatory vs. Discretionary Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Recent Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
FY2003 Budget Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
FY2002 Supplemental Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
The 2002 Farm Bill (P.L. 107-171) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
FY2003 Agriculture Appropriations Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Administration’s Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
House Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Senate Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
FY2003 Agriculture Appropriations: Proposed Spending Levels and Current Issues
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Farm Commodity Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Farm Disaster Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Payment Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Crop Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Farm Service Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
FSA Salaries and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
FSA Farm Loan Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Agricultural Trade and Food Aid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
FAS Salaries and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Foreign Food Aid: Funding and Issues . . . . . . . . . . . . . . . . . . . . . . . . 13
Mandatory Trade Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Agricultural Exports to Cuba . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Natural Resources and Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Discretionary Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Mandatory Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Agricultural Research, Education, and Economics . . . . . . . . . . . . . . . . . . . 19
Agricultural Research Service (ARS) . . . . . . . . . . . . . . . . . . . . . . . . . 19
Cooperative State Research, Education, and Extension Service (CSREES)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Economic Research Service (ERS) and National Agricultural Statistics
Service (NASS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Food Safety and Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Marketing and Regulatory Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Animal and Plant Health Inspection Service . . . . . . . . . . . . . . . . . . . . 23
Agricultural Marketing Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Grain Inspection, Packers, and Stockyards Administration . . . . . . . . . 24
Rural Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Rural Community Advancement Program (RCAP) . . . . . . . . . . . . . . . 26
Rural Housing Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Rural Utilities Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Rural Business-Cooperative Service . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Other Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Food and Nutrition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Food and Drug Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Food Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Drug Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Medical Device Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Biologics Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
For Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
List of Tables
Table 1. USDA and Related Agencies Appropriations, FY1994 to FY2002 . . . . 3
Table 2. FY2002 Supplemental Appropriations (P.L. 107-206/H.R. 4775): USDA
and Related Agencies Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Table 3. Congressional Action on FY2003 Appropriations for the U.S. Department
of Agriculture and Related Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Table 4. USDA and Related Agencies Appropriations for FY2003 Budget Authority
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Appropriations for FY2003:
U.S. Department of Agriculture
and Related Agencies
Most Recent Developments
During the week of July 22, 2002, the Senate Appropriations Committee
completed subcommittee and full committee action on its version of the FY2003
appropriations bill for the U.S. Department of Agriculture and related agencies (S.
2801, S.Rept. 107-223). S. 2801 contains total funding of $74.661 billion, compared
with $74.306 billion in the House Appropriations Committee-reported bill (H.R.
5263, H.Rept. 107-623). House and Senate floor action on their respective measures
is expected in September.
Separately, the President signed into law on August 2, 2002, a supplemental
FY2002 funding measure (P.L. 107-206) that will provide additional funds primarily
for the ongoing war against terrorism. Of the $28.9 billion in the act, $5.1 billion will
be provided only if the President submits a request and designates that amount as
emergency spending within 30 days of enactment. The President has stated that he
will not take such action. Included in the $28.9 billion total is $377 million in
supplemental funding for USDA and related agencies, most of which is designed to
help protect production agriculture and the food supply from terrorist threats, and to
provide emergency watershed assistance to flooded areas. However, $165 million
of the $377 million is designated as a contingent appropriation and will not be
provided without the President’s consent.
USDA Spending at a Glance
The U.S. Department of Agriculture (USDA) carries out its widely varied
responsibilities through approximately 30 separate internal agencies and offices
staffed by some 100,000 employees. USDA is responsible for many activities
outside of the agriculture budget function. Hence, spending for USDA is not
synonymous with spending for farmers.
USDA gross outlays for FY2001 (the most recently completed fiscal year) were
$79.95 billion. The mission area with the largest gross outlays ($40.75 billion or
51% of spending) was for food and nutrition programs – primarily the food stamp
program (the costliest of all USDA programs), various child nutrition programs, and
the Women, Infants and Children (WIC) program. The second largest mission area
in terms of total spending is for farm and foreign agricultural services, which totaled
$24.9 billion, or 31.2% of all USDA spending. Within this area are the programs









































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































































CRS-2
funded through the Commodity Credit Corporation (e.g., the farm commodity price
and income support programs and certain mandatory conservation and trade
programs), crop insurance, farm loans, and foreign food aid programs.

USDA spending in FY2001 also included $6.4 billion (8%) spent on an array
of natural resource and environment programs, approximately three-fourths of which
was for the activities of the Forest Service, and the balance for a number of
discretionary conservation programs for farm producers. (USDA’s Forest Service is
funded through the Interior appropriations bill, and is the only USDA agency not
funded through the annual agriculture appropriations bill.) USDA programs for rural
development ($2.65 billion in gross outlays for FY2001); research and education
($2.4 billion); marketing and regulatory activities ($1.46 billion); meat and poultry
inspection ($803 million); and departmental administrative offices and other
activities ($574 million) account for the balance of USDA spending.
Figure 1
U.S. Department of Agriculture Actual Gross Outlays, FY2001
Mandatory vs. Discretionary Spending
Approximately three-fourths of total spending within the U.S. Department of
Agriculture is classified as mandatory, which by definition occurs outside the control
of annual appropriations. Currently accounting for the vast majority of USDA
mandatory spending are: the farm commodity price and income support programs
(including ongoing programs authorized by the 1996 farm bill and emergency
programs authorized by various appropriations acts); the food stamp program and
child nutrition programs; the federal crop insurance program; and various agricultural
conservation and trade programs.
CRS-3
Although these programs have mandatory status, many of these accounts
ultimately receive funds in the annual agriculture appropriations act. For example,
the food stamp and child nutrition programs are funded by an annual appropriation
based on projected spending needs. Supplemental appropriations generally are made
if and when these estimates fall short of required spending. An annual appropriation
also is made to reimburse the Commodity Credit Corporation for losses it incurs in
financing the commodity support programs and the various other programs it
finances.
The other 25% of the USDA budget is for discretionary programs, which are
determined by funding in annual appropriations acts. Among the major discretionary
programs within USDA are Forest Service programs; certain conservation programs;
most of its rural development programs and research and education programs;
agricultural credit programs; the supplemental nutrition program for women, infants,
and children (WIC); the Public Law (P.L.) 480 international food aid program; meat
and poultry inspection, and food marketing and regulatory programs. Funding for all
USDA discretionary programs (except for the Forest Service) is provided by the
annual agriculture appropriations act. Funding for Forest Service programs is
included in the annual Interior appropriations act.
A key distinction between mandatory and discretionary spending involves how
these two categories of spending are treated in the budget process. Congress
generally controls spending on mandatory programs by setting rules for eligibility,
benefit formulas, and other parameters rather than approving specific dollar amounts
for these programs each year. Eligibility for mandatory programs is usually written
into authorizing law, and any individual or entity that meets the eligibility
requirements is entitled to the benefits authorized by the law. Spending for
discretionary programs is controlled by annual appropriations acts. The thirteen
subcommittees of the House and Senate Appropriations Committees originate bills
each year which decide how much funding to devote to continuing current activities
as well as any new discretionary programs.
Table 1. USDA and Related Agencies Appropriations, FY1994 to FY2002
(budget authority in billions of dollars)
FY94
FY95
FY96
FY97
FY98
FY99
FY00
FY01
FY02
Discretionary
$14.59
$13.29
$13.31
$13.05
$13.75
$13.69
$13.95
$15.07
$16.02
Mandatory
$56.25
$54.61
$49.78
$40.08
$35.80
$42.25
$61.95
$58.34
$56.91
Total Budget
$70.84
$67.90
$63.09
$53.12
$49.55
$55.94
$75.90
$73.41
$72.93
Authority
Note: Includes regular annual appropriations for all of USDA (except the Forest Service), the Food and Drug Administration, and the Commodity
Futures Trading Commission. Excludes all emergency supplemental appropriations.
Source: House Appropriations Committee.
CRS-4
Recent Congressional Action
FY2003 Budget Resolution
The full House approved its version of an FY2003 budget resolution
(H.Con.Res. 353) on March 20, 2002. The Senate Budget Committee completed
markup of its version of the resolution (S. Con. Res. 100) during the week of March
18, 2002. Senate floor action is pending. The budget resolution establishes a
framework for all federal spending and revenue for FY2003 and does not require
presidential approval. Although the FY2003 budget resolution has not been resolved,
the House and Senate Appropriations Committees have made FY2003 discretionary
spending allocations to each of their thirteen subcommittees to fund their respective
annual appropriations bills. These so-called 302b allocations are based on the
amount of total discretionary spending contained within the House and Senate
versions of the FY2003 budget resolution. The agriculture subcommittee of the
House Appropriations Committee received an allocation of $17.601 billion for the
funding of all USDA and related agency programs under the subcommittee’s
jurisdiction. Because total discretionary spending is higher in the Senate version of
the budget resolution, the Senate Appropriations Committee allocated $17.980 billion
to its agriculture subcommittee.
FY2002 Supplemental Appropriations
On August 2, 2002, the President signed into law a supplemental appropriation
bill (P.L. 107-206, H.R. 4775) for FY2002. The conference agreement adopted by
both chambers contained total appropriations of $28.9 billion primarily to continue
the war on terrorism and to address homeland security needs. Of the $28.9 billion
in the law, $5.1 billion was provided contingent upon the President submitting a
formal request for the funds and declaring a budget emergency for the new spending.
Current indications are that the President will not request these emergency funds,
although he has until early September to take such action. Funding in P.L. 107-206
is in addition to $20 billion in FY2002 supplemental funding already provided in an
earlier supplemental measure (P.L. 107-117), also primarily in response to the
September 11, 2001 terrorist attacks.
Within the $28.9 billion provided in P.L. 107-206 is approximately $377
million in supplemental funding for USDA and related agencies. Most of the $377
million is designed to help protect production agriculture and the food supply from
terrorist threats, and to provide emergency watershed assistance to flooded areas.
However, $165 million of the $377 million is designated as a contingent
appropriation and thus requires a formal request and an emergency designation by the
President. If the Administration does not submit a request for these funds with an
emergency designation, as is expected, then total funding provided by P.L. 107-206
to USDA and related agencies will be $212 million.
The only Administration request for new supplemental funding within USDA
was $75 million for the Special Supplemental Nutrition Program for Women, Infants,
and Children (WIC) program to address rising caseload requirements. The only non-
contingent appropriations for USDA in the act were the $75 million requested for
CRS-5
Table 2. FY2002 Supplemental Appropriations (P.L. 107-206/H.R. 4775):
USDA and Related Agencies Provisions
-million $-
P.L.
Department, Agency, Office or Programs
House
Senate
107-206
Non-Contingent USDA Appropriations:
Food and Nutrition Service
Women, Infants and Children (WIC ) Program
75.0
75.0
75.0
Agricultural Research Service
Buildings and Facilities: (Security for Ames, IA animal disease research)
–
50.0
25.0
Natural Resources Conservation Service
Watershed and Flood Prevention Operations: Natural disasters.
–
73.0
94.0
Rural Utilities Service
Local Television Loan Guarantee Program
–
20.0
8.0
Agricultural assistance to producers along the Rio Grande due to failure of
Mexico to deliver water under current treaty
–
10.0
10.0
Total: Non-Contingent USDA Appropriations
75.0
228.0
212.0
Contingent Appropriations: USDA and FDA
USDA
Office of the Secretary
Upgrades of facilities for homeland security
–
18.0
18.0
Agricultural Research Service
Salaries and Expenses: (Animal and plant diseases)
–
16.0
8.0
Cooperative State Research, Education, and Extension Service
Extension Activities: National extension program of first response in rural areas
in the event of a disaster
–
16.0
6.0
Animal and Plant Health Inspection Service
 Salaries and Expenses: Protection against bio-terrorism threats
10.0
–
33.0
Buildings and Facilities: Security measures
–
60.0
–
Food Safety and Inspection Service:
Foreign country equivalence agreements (House) International oversight
activities for imported meat and poultry (Senate). Combination of House and
Senate (Conference Report).
2.0
15.0
13.0
Natural Resources Conservation Service
Watershed and Flood Prevention Operations: Natural disasters.
–
27.0
50.0
Rural Community Advancement Program
Protection of Rural Water Supplies from Terrorism
–
25.0
20.0
Food and Drug Administration:
Medical devices and radiological health
18.0
–
17.0
Total Contingent Appropriations: USDA and FDA
30.0
177.0
165.0
Grand Total (Contingent and Non-Contingent) before Rescissions
105.0
405.0
377.0
Rescissions:
CRS-6
Export Enhancement Program limitation
(450.0)
–
(445.0)
Rural Utilities Service
–
(20.0)
(20.0)
Food Stamps
–
(33.0)
(24.0)
WIC; as well as unrequested funding of: $94 million for Watershed and Flood
Prevention Operations; $25 million for the Ames, Iowa animal disease research
facility; $10 million in agricultural assistance to producers along the Rio Grande; and
$8 million in Rural Utilities Service loan guarantees.
P.L. 107-206 also contains rescissions of USDA spending, including a $450
million reduction in the authorized mandatory spending level for the Export
Enhancement Program (EEP) in FY2002 (from $478 million to $28 million),
although actual spending for EEP has been close to $0 in recent years.
The 2002 Farm Bill (P.L. 107-171)
The President signed into law on May 13, 2002 the Farm Security and Rural
Investment Act of 2002 (P.L. 107-171, the 2002 farm bill) which establishes federal
farm policy for the next 6 years. The FY2002 budget resolution (H.Con.Res. 83)
permitted the House and Senate Agriculture Committees to report omnibus farm
legislation that increased mandatory spending by $73.5 billion over 10 years
(FY2002-2011) on USDA-administered farm, conservation, trade, food and nutrition
and related programs. The Congressional Budget Office projects that the enacted
2002 farm bill will increase mandatory spending by $44.1 billion over the 6-year life
of the act and $73.5 billion over 10 years, as permitted by the budget resolution. (For
more information, see the CRS Electronic Briefing Book Page, What is the Cost of
the 2002 Farm Bill?).
A number of provisions that were considered during the farm bill debate but
were not included in the conference agreement might resurface as floor amendments
to the FY2003 agriculture appropriations bill. These include possible consideration
of a multi-billion dollar emergency disaster payment package for 2001 and/or 2002
crop and livestock losses; more stringent payment limitations for farm commodity
price and income support programs; and a prohibition on meat packers from owning
livestock. For more information on the omnibus farm bill, see the CRS electronic
resource, Agriculture Policy and the Farm Bill Briefing Book.
FY2003 Agriculture Appropriations Action
Administration’s Request.
As the first step in the FY2003
appropriations process, the Bush Administration released its budget request on
February 4, 2002. Within the budget, the Administration requested FY2003 budget
authority of $74.064 billion for the U.S. Department of Agriculture and related
agencies (which includes all of USDA except the Forest Service, and also includes
the Food and Drug Administration and the Commodity Futures Trading
CRS-7
Commission.) The $74.064 billion requested for FY2003 is $1.14 billion above the
regular appropriations of $72.928 billion made in FY2002 (P.L. 107-76). It is $442
million above the total FY2002 appropriations of $73.621 billion, which includes
two supplemental appropriations acts (P.L. 107-117 and P.L. 107-206), which made
nearly $700 million in net supplemental appropriations to various USDA programs,
FDA, and CFTC in response to the September 11 terrorist attacks.
The requested $17.4 billion for discretionary accounts is $1.4 billion above
regular discretionary appropriations of $16.0 billion made in FY2002, and $870
million above the total appropriation of $16.55 billion that includes the $535 million
supplemental. Accounting for $368 million of the requested increase in discretionary
spending for USDA and related agencies is the Administration’s assumption of a
legislative proposal that would require all federal agencies to assume the full cost of
accruing employee pensions and retiree health benefits beginning in FY2003.1
Table 3. Congressional Action on FY2003 Appropriations for the U.S.
Department of Agriculture and Related Agencies
Subcommittee
Conference Report
Markup Completed
Approval
House
House
Senate
Senate
Conference
House
Senate
Report
Passage
Report
Passage
Report
House
Senate
Public Law
H.R. 5263
S. 2801
(H.Rept.
(S.Rept.
107-623)
107-223)
6/26/02 7/23/02
7/26/02
**
7/25/02
**
**
**
**
**
** = Pending
House Action. The agriculture subcommittee of the House Appropriations
Committee and the full House Appropriations Committee completed their respective
markups of the FY2003 agriculture bill for USDA and related agencies on June 26
and July 11, 2002, respectively. The bill (H.R. 5263) and report (H.Rept. 107-623)
were filed by the full committee on July 26, 2002
Total appropriations in H.R. 5263, as reported, are $74.306 billion, of which
$17.601 billion are for discretionary programs, and $56.705 billion for mandatory
USDA programs. The $17.601 billion for discretionary programs is exactly equal to
the 302b allocation given to the subcommittee by the full committee, (see “FY2003
Budget Resolution” above), and $180 million above the President’s request for
FY2003. The discretionary level in the House bill is $908 million higher than what
was provided in FY2002 including supplementals, or $1.4 billion higher than the
regular FY2002 appropriations excluding emergency supplementals.
1 Although the total Administration request for FY2003 includes the estimated $368
million to fund this proposal, this report (in conformance with the presentation of data by
the House Appropriations Committee) does not allocate these requested funds across
individual agencies.
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Senate Action. The Senate Appropriations Committee completed
subcommittee and full committee markup during the week of July 22, 2002, and
reported its version of the FY2003 agriculture appropriations bill (S. 2801, S. Rept
107-223) on July 25. S. 2801, as reported, provides total funding of $74.66 billion,
which is $354 million above the House bill, $598 million above the Administration
request, and $1.2 billion above the FY2002 enacted level including. Of the total
amount provided in S. 2801, $17.98 billion is for discretionary programs, compared
with $17.6 billion in the House bill, $17.4 billion in the Administration’s request and
$16.55 billion provided in FY2002.
FY2003 Agriculture Appropriations: Proposed
Spending Levels and Current Issues
The following sections compare the House and Senate Appropriations
Committee bills (H.R. 5263 and S. 2801) to each other and to the Administration’s
FY2003 request and the FY2002 enacted level for various mission areas and agencies
within USDA, and for FDA. Also see the table at the end of the report for a tabular
summary of the House and Senate bills, the FY2003 request, and the FY2002
appropriations. This report and the table will track congressional action on the
FY2003 agriculture appropriations bill as the process continues.
Farm Commodity Support
Most spending for USDA’s mandatory agriculture and conservation programs
is funded through USDA’s Commodity Credit Corporation (CCC). The CCC is a
wholly owned Government corporation. It has the legal authority to borrow up to $30
billion at any one time from the U.S. Treasury. These borrowed funds are used to
finance the spending of ongoing programs such as farm commodity price and income
support activities (including annual production flexibility contract, or so-called
AMTA, payments and loan deficiency payments); and various agricultural
conservation and trade programs. The CCC has also been the funding source for a
large portion of emergency supplemental spending over the years, particularly for ad-
hoc farm disaster payments, and direct market loss payments to growers of various
commodities which have been provided in response to low farm commodity prices.
The CCC will also be the funding source for all mandatory farm commodity,
conservation or trade programs authorized by the recently enacted 2002 farm bill
(P.L. 107-171).

The CCC must eventually repay the funds it borrows from the Treasury. But,
because the CCC never earns more than it spends, its losses must be replenished
periodically through a congressional appropriation so that its $30 billion borrowing
authority (debt limit) is not depleted, which would render the corporation unable to
function. Congress generally provides this infusion through the regular annual
USDA appropriation law. Because of the degree of difficulty in estimating its
funding needs, which is complicated by crop and weather conditions and other
uncontrollable variables, the CCC in recent years has received a “current indefinite
appropriation,” which in effect allows the CCC to receive “such sums as are
necessary” during the fiscal year for previous years’ losses and current year’s losses.
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Indefinite appropriations have become more common for the CCC in recent years,
particularly in FY2000 when CCC net outlays in that year totaled $32 billion.
Without an indefinite appropriation, the CCC would have exhausted its $30 billion
borrowing limit.
For FY2003, the Administration requests an indefinite appropriation for the
CCC estimated at $16.285 billion, compared with an estimated $20.279 billion for
FY2002. Both H.R. 5263 and S. 2801 concur with this request and estimate.
Farm Disaster Assistance. The President’s request does not anticipate any
emergency supplemental spending for economic or natural disaster assistance for
farmers in either FY2002 or FY2003, which if enacted would alter CCC spending.
The Administration contends that the $73.5 billion in new farm bill spending over
10 years provides adequate financial assistance to farmers, and that if any additional
ad hoc assistance is provided it should be offset with spending reductions in other
USDA accounts.
The House reported bill (H.R. 5263) contains $100 million in regular FY2003
discretionary spending for payments to livestock producers with 2002 livestock
losses in a disaster designated area. The Senate reported bill (S. 2801) contains no
livestock assistance. Neither bill currently contains any disaster assistance for crop
farmers. An amendment to provide assistance to specialty crop growers (primarily
fruits and vegetables) was defeated by a vote of 29-31 in the full House
Appropriations Committee markup.
A Senate amendment to provide emergency disaster assistance to crop and
livestock farmers suffering losses due to drought, floods, and other natural disasters
was introduced during debate on the FY2002 supplemental bill (S. 2551), but was not
offered on the Senate floor. Earlier, a $2.3 billion assistance package was included
in the Senate-passed version of the 2002 farm bill (P.L. 107-171), but was deleted by
conferees. A combined multi-billion dollar disaster assistance amendment for
livestock and crop growers might be offered to the FY2003 agriculture appropriations
bill on the Senate floor.
For information on available farm disaster assistance, see CRS Report RS21212,
Farm Disaster Assistance.
Payment Limits. The 2002 farm bill established annual limits for recipients
of farm commodity support payments. Supporters of payment limits argue that the
federal government should not directly finance the consolidation of farms into larger
and larger operations through commodity support programs. Critics of payment limits
counter that all farms are in need of support when market prices decline, and larger
farms should not be penalized for the economies of size they have achieved. An
amendment to further limit a recipient’s total farm program payments might be
offered to the FY2003 agriculture appropriations bill on both the House and Senate
floor. For more on this issue, see the CRS Electronic Briefing Book Page,
Commodity Program Payment Limits Under the 2002 Farm Bill.
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Crop Insurance
The federal crop insurance program is administered by USDA’s Risk
Management Agency (RMA). It offers basically free catastrophic insurance to
producers who grow an insurable crop. Producers who opt for this coverage have the
opportunity to purchase additional insurance coverage at a subsidized rate. Most
policies are sold and completely serviced through approved private insurance
companies that have their program losses reinsured by USDA. The annual
agriculture appropriations bill makes two separate appropriations for the federal crop
insurance program. It provides discretionary funding for the salaries and expenses
of the RMA. It also provides “such sums as are necessary” for the Federal Crop
Insurance Fund, which funds all other expenses of the program, including premium
subsidies, indemnity payments, and reimbursements to the private insurance
companies.
The House reported bill (H.R. 5263) provides $70.7 million for FY2003 RMA
salaries and expenses, the only discretionary component of the federal crop insurance
program. The Senate reported bill (S. 2801) provides $71.2 million. The House and
Senate levels are slightly below the Administration request only because neither bill
concurs with the Administration request to shift GSA rent expenses from a central
account to individual agency accounts. The Administration request is $4 million
below the FY2002 appropriation of $74.75 million. Most of the reduction in the
FY2003 funding request is attributable to one-time costs in FY2002 for
implementing the Agricultural Risk Protection Act (P.L. 106-224), which provided
increased subsidies and made other enhancements to the crop insurance program.
For mandatory expenses of the crop insurance program (premium subsidy,
program losses and reimbursements to private insurance companies), the
Administration requests “such sums as are necessary” and estimates an FY2003
appropriation of $2.89 billion, which is virtually equal to the FY2002 estimate of
$2.90 billion. H.R. 5263 and S. 2801 concur with the FY2003 request.
Annual spending on the crop insurance program is difficult to predict in advance
and is dependent on weather and crop growing conditions. The crop insurance
program received legislative enhancements in 2000 (P.L. 106-224) which have
contributed to significantly higher farmer participation in the program. The
Administration maintains that the increased participation has resulted in windfall
profits for the private insurance companies. Hence, the budget request contains a
legislative proposal to require private insurance companies to absorb more of the risk
of the program by limiting their underwriting gains to 11.5% of retained premiums.
Neither bill concurs with this proposal. Senate report language directs USDA to
follow current procedures in the Standard Reinsurance Agreement between private
companies and USDA before any risk-sharing changes are made.
For more background on crop insurance, see CRS Report RL30739, Federal
Crop Insurance and the Agriculture Risk Protection Act of 2000 (P.L. 106-224).

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Farm Service Agency
While the Commodity Credit Corporation serves as the funding mechanism for
the farm income support and disaster assistance programs, the administration of these
and other farmer programs is charged to USDA’s Farm Service Agency (FSA). In
addition to the commodity support programs and most of the emergency assistance
provided in recent supplemental spending bills, FSA also administers USDA’s direct
and guaranteed farm loan programs, certain conservation programs and domestic and
international food assistance and international export credit programs.
FSA Salaries and Expenses. This account funds the administrative
expenses for program administration and other functions assigned to the FSA. These
funds consist of appropriations and transfers from CCC export credit guarantees,
from P.L. 480 loans, and from the various direct and guaranteed farm loan programs.
All administrative funds used by FSA are consolidated into one account. For
FY2003, the Administration requests an appropriation of $993.6 million for FSA
salaries and expenses, compared with $939 million appropriated in FY2002. Most
of the requested increase is attributable to increased pay costs and a lack of carryover
funds from FY2002. (FY2002 funding was bolstered by a $29 million carryover
from FY2001. No carryover is expected into FY2003.) The requested level for
FY2003 does not reflect any new activities associated with the recently enacted 2002
farm bill (P.L. 107-171). The farm bill provides $50 million in new mandatory no-
year funding for FSA salaries and expenses to administer new farm bill programs.
This amount is expected to fall short of anticipated needs. Hence, the Administration
is expected soon to request an additional $60 million in FSA funds for FY2003 for
farm bill implementation.
The House reported bill (H.R. 5263) provides $977 million, $17 million less
than the Administration request of $993.6 million. The Senate reported bill (S. 2801)
provides $997.4 million, which is $4 million more than the Administration request.
Neither bill concurs with the President’s request to increase the FSA appropriation
by $17 million over FY2002 to cover FSA rental payments to GSA, which are
currently paid out of a central USDA account.
FSA Farm Loan Programs.
Through FSA farm loan programs, USDA
serves as a lender of last resort for family farmers unable to obtain credit from a
commercial lender. USDA provides direct farm loans and also guarantees the timely
repayment of principal and interest on qualified loans to farmers from commercial
lenders. FSA farm loans are used to finance the purchase of farm real estate, help
producers meet their operating expenses, and financially recover from natural
disasters. Some of the loans are made at a subsidized interest rate. An appropriation
is made to FSA each year to cover the federal cost of making direct and guaranteed
loans, referred to as a loan subsidy. Loan subsidy is directly related to any interest
rate subsidy provided by the government, as well as a projection of anticipated loan
losses caused by farmer non-repayment of the loans.
For FY2003, the House reported bill (H.R. 5263) concurs with the
Administration request for an appropriation of $212.2 million to subsidize the cost
of total direct and guaranteed farm loans of $3.8 billion. The Senate reported bill (S.
2801) provides $243.8 million, $31.6 million above FY2002 and the FY2003 request,
CRS-12
to support $4.065 billion in farm loans, or $263 million more in loans than the House
bill and the Administration request. Most of the difference between the House and
Senate funding levels is that the Senate bill provides $24 million more in loan
subsidy than the House to support an additional $205 million in guaranteed
subsidized farm operating loans.
FSA farm loan levels have been higher in recent years because an FY2000
supplemental act (P.L. 106-113) provided significant emergency funding for various
USDA farm loan programs, from which balances were carried over into subsequent
years. Supplemental funding has been provided in recent years for federal farm loans
in response to low farm commodity prices, which have diminished the ability of
farmers to secure commercial farm loans.
Agricultural Trade and Food Aid
The House reported bill (H.R. 5263) recommends budget authority of $1.491
billion in FY2003 for USDA’s international activities that are subject to annual
appropriations (P.L. 480 food aid, salaries and expenses of the Foreign Agricultural
Service, and administrative expenses for managing export credit guarantee
programs.) This level is $367 million greater than enacted in FY2002 and $41.5
million greater than requested by the President for FY2003. The Senate reported bill
(S. 2801) appropriates $1.464 billion, $27 million less than in H.R. 5263, but $15
million above the President’s request, and $340 million above FY2002. Almost all
of the additional funding in both bills goes to international food aid programs.
Among its general provisions, H.R. 5263 limits funding for one of USDA’s
export subsidy programs, the Export Enhancement Program (EEP) for which the
President requested $478 million, to not more than $28 million in FY2003. The
Senate Committee bill does not limit EEP spending. Savings from the EEP program
in the House bill were allocated to a variety of other USDA programs. Both House
and Senate Committee actions imply a program level of around $6.0 billion for all
of USDA’s international activities–food aid, export credit guarantees, export market
development, and export subsidies.2
The Administration’s budget estimate of a program level of $6.45 billion for all
USDA international activities for FY2003 was based on estimated spending of $478
million for EEP. The program levels for USDA’s international activities were
estimated at $6.4 billion in FY2002, and were $5.22 billion in FY2001. Increased
budget authority requested for FY2003 reflects a decision by the Administration to
phase out food aid that is dependent on surpluses and to pay for much of U.S. foreign
2 Program level is an estimate of the value of all goods and services provided through
USDA’s international activities. Program level exceeds budget authority because certain
significant federal credit programs, such as export credit guarantees funded through the
borrowing authority of the Commodity Credit Corporation (CCC), do not require annual
appropriations. Only administrative expenses and loan subsidies, not the value of the loan
or guarantee, require an appropriation. In addition, CCC funded activities, such as EEP,
MAP, and FMDP, which are included in program level, do not require annual
appropriations.
CRS-13
food aid with discretionary rather than mandatory spending. Although both bills
recommend increases in budget authority for discretionary food aid programs, the
Committee reports also stress the continuing importance of commodity assistance
and the use of surplus commodities in U.S. food aid programs. The Senate
committee report (S.Rept. 107-223), for example, expresses strong disagreement with
Administration decisions to phase out food aid based on commodity surpluses.
FAS Salaries and Expenses. The Foreign Agricultural Service (FAS)
administers USDA’s international programs. The administration of P.L. 480 Food
for Peace, however, is shared between USDA and the U.S. Agency for International
Development (USAID). USDA is responsible for Title I of P.L. 480, which provides
low-interest, long-term loans to developing countries to finance the purchase of U.S.
food products, while USAID is responsible for Title II (commodity donations) and
Title III (a bilateral food grant program). FAS (and the Farm Service Agency–FSA)
administer the export credit guarantee programs as well. For salaries and expenses
of FAS, H.R. 5263 provides budget authority of almost $130 million and S. 2801
provides $131.9 million, compared with the President’s request of $131.6 million and
the FY2002 enacted amount of $121.8 million. In addition, both bills recommend
$4.1 million for administrative expenses of FAS and FSA in connection with the
export credit programs.
Foreign Food Aid: Funding and Issues. Within the $1.491 billion of
recommended budget authority requested for discretionary programs, H.R. 5263, as
reported, provides $1.357 billion for P.L. 480 (Food for Peace) programs, which
have been the main channel for U.S. foreign food aid and are the largest appropriated
international USDA program. The House level is $358 million greater than the
FY2002 enacted amount and $43 million greater than the President’s FY2003
request. Compared to the budget request, H.R. 5263 increases Title II commodity
donations by $15 million and Title I loans by $28 million.
Within the $1.464 billion of budget authority provided by S. 2801 for
discretionary programs, $1.328 billion would go to P.L. 480 food aid, $29 million
less than the House level. One difference is that H.R. 5263 provides more BA for
Title II food aid than requested by the President, while S. 2801 provides the amount
requested by the President. The budget request, as submitted, is estimated by USDA
to support 3.7 million metric tons of P.L. 480 commodity assistance to developing
countries in FY2003, about the same volume as provided in FY2002 under P.L. 480.
Despite the recommended increases in budget authority, the program level for
all U.S. food aid under the Administration request would decline to $1.2 billion,
compared with an estimated $1.61 billion in FY2002 and $1.66 billion in FY2001.
The reduction in program level is due to the Administration’s decision to curtail
sharply its reliance on another food aid vehicle, Section 416(b) surplus commodity
donations. Section 416 is funded through the borrowing authority of the Commodity
Credit Corporation, and is therefore not subject to annual appropriations The
Administration expects to use only about $50 million in Section 416 commodities
(mostly surplus nonfat dry milk) in FY2003, compared with an estimated $360
million in Section 416 commodities in FY2002 and $634 million in FY2001.
Proposed reductions in Section 416 (which in past years have not necessarily
been achieved) are rationalized by a recent Administration review of food aid that
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also recommended (and is in the budget) that all programs now run through private
voluntary organizations (PVOs), cooperatives, and the World Food Program be
placed in USAID, with USDA food aid activities confined to government-to-
government programs. Consistent with this approach, the Administration shows no
CCC funding in FY2003 for Food for Progress (FFP) which provides U.S.
commodities to developing countries and emerging democracies. CCC funding of
this program has averaged around $100 million annually in recent years. Any FFP
activity would be limited to government-to-government programs under P.L. 480
Title I. Reauthorization of the FFP program in the 2002 farm bill (P.L. 107-701),
with continued reliance on CCC funding, complicates the efforts of the
Administration to phase out CCC-funded food aid programs.
The Administration’s decisions to phase out Section 416(b) commodity
donations and to limit the proportion of commodities that are monetized (i.e., sold)
to finance projects have provoked controversy. Food aid providers, such as private
voluntary organizations (PVOs) and cooperatives, agribusiness suppliers of
commodities to the food aid programs, and Members of Congress have criticized the
Administration’s decisions on food aid. These groups welcome the increase in Title
II commodity donations, but maintain that the net effect of the Administration’s
decision will be to reduce U.S. foreign food aid. Reflecting these views, the House
Committee report (H.Rept. 107-623) endorses the use of commodities (and
monetization) in U.S. food aid programs and points out that it “expects” the
Administration to take its views into consideration in administering food aid
programs. The Senate report (S.Rept. 107- 223) takes a similar position. While
some food aid groups agree that food aid should not be based on the availability of
surpluses (as is the case with Section 416(b), they maintain that substantially more
funds for food aid than requested by the President or provided in the House or Senate
bills are needed.
The use of commodity surpluses to augment U.S. food aid has been criticized
by the European Union, Australia, and other agricultural exporting countries as an
effort to circumvent U.S. World Trade Organization (WTO) export subsidy reduction
commitments. These trading partners argue that much of U.S. food aid is being used
to manage supplies rather than to meet emergency needs and that large food aid
shipments impede sales of agricultural products by and between developing
countries. The issue of food aid and international agricultural trading rules is being
pursued by U.S. trading partners in the new round of multilateral trade negotiations
launched at the end of 2001.

Mandatory Trade Programs. In addition to Section 416(b) and Food for
Progress, many other USDA international programs are not subject to direct annual
appropriations, and instead are funded through CCC borrowing authority. About
two-thirds of the proposed FY2003 program level, $4.058 billion, would be for CCC
export credit programs, which guarantee payment for commercial financing of U.S.
agricultural exports. The export value of credit guarantees historically has not
reached the levels anticipated in budget requests due to actual market conditions and
credit needs.
U.S. export credit programs have also been raised as an issue in WTO
agricultural trade negotiations. The EU and other trading partners charge that the
CRS-15
program has a subsidy element (although it is much less than the subsidy represented
by the EU’s export restitution program) and gives the U.S. an unfair competitive
advantage in exporting certain agricultural commodities. The U.S. has been engaged
in negotiations on export credit programs in the Organization for Economic
Cooperation and Development (OECD), but these negotiations did not succeed and
have been suspended. Any changes in the U.S. program that might result from trade
negotiations would have to withstand scrutiny by the House and Senate Agriculture
Committees which strongly support the programs as they are presently constituted.
For other CCC-funded programs, the Administration proposes $90 million for
the market access program (MAP) and $28 million for the foreign market
development cooperator program (FMDP), the same as current year funding. Both
programs – which have been expanded significantly by the 2002 farm bill (P.L. 107-
171) – assist trade associations and others to develop overseas markets for U.S.
farm products. For one CCC-funded direct export subsidy program, the Export
Enhancement Program (EEP), H.R. 5263 limits spending to $28 million. In contrast,
the Administration had proposed $478 million for EEP, the maximum permitted by
the 1996 farm law and world trade obligations. For its proposed reductions from the
authorized level, the House bill scored savings of $450 million. Savings from EEP
reductions were reallocated in the House bill to a variety of other USDA programs
(although only about $1 million annually has been used in recent years). In the past,
the Congressional Budget Office has scored no savings for proposed cuts to EEP
funding, since actual spending in the program has been negligible. However, the
House Budget Committee has chosen to use the Office of Management and Budget
(OMB) score which allows dollar-for-dollar savings for cuts from the authorized EEP
level.
For the other export subsidy program, the Dairy Export Incentive Program
(DEIP), the President’s budget anticipates that $63 million would be provided also
reflecting maximum permitted levels under trade obligations.
No additional funding is in the FY2003 budget request for the Global Food for
Education Initiative (GFEI), a pilot school and child nutrition program begun by the
Clinton Administration and expected to cost an estimated $230 million. USDA said
a decision on continuation will hinge on the results of an evaluation. However, the
new farm bill (P.L. 107-171) mandates $100 million of CCC funding to continue this
program in FY2003 and “such sums as necessary” in fiscal years 2004-2007. Finally,
the Administration proposes that all costs of the “cargo preference” law, which
requires that 75% of all food aid be shipped on U.S. flag vessels when feasible,
would be borne by USDA; currently, the U.S. Maritime Administration reimburses
USDA for one-third of those costs.
Agricultural Exports to Cuba. Members who support the sale of U.S.
agricultural products to Cuba might offer amendments to relax specific prohibitions
included in current law, when the FY2003 agriculture appropriations bill reaches the
House and Senate floor. They seek to repeal the permanent prohibition on the use
of private U.S. financing to facilitate agricultural exports to Cuba, and to repeal the
statutory ban on any ship that visits Cuba from calling on an American port for 180
days. Supporters of these changes view these restrictions as complicating and
impeding trade that is now otherwise permitted. Currently, agricultural sales to Cuba
CRS-16
are permitted only on a cash basis or if financed by third country banks. Under the
statutory exception made to the U.S. embargo on Cuba, the Cuban government since
November 2001 has made $107 million in cash purchases of U.S. agricultural
commodities and food products. Despite the shipping ban provision, the Department
of Treasury has authority to make exceptions, and has issued licenses for ships to
enter U.S. ports to load agricultural products for transport to Cuba.
Both H.R. 5263 and S. 2801, as reported, do not include any Cuba trade
provisions. Separately, the House on July 23 adopted by voice vote an amendment
to the FY2003 Treasury-Postal Operations appropriations bill (H.R. 5120)
prohibiting the use of funds to implement U.S. sanctions on private commercial sales
of agricultural commodities and medical products to Cuba. President Bush has stated
that he would veto any legislation that relaxes the U.S. embargo on Cuba in any way,
including the private financing on food sales prohibition, until Cuban reforms occur.
For more information, see the CRS electronic briefing book page, Economic
Sanctions and Agricultural Exports.
For more information on agricultural trade and food aid, see CRS Issue Brief
IB98006, Agricultural Export and Food Aid Programs and CRS Issue Brief IB10077,
Agricultural Trade Issues in the 107th Congress.
Natural Resources and Environment
The natural resources and environment mission area within USDA is
implemented through the programs of the Natural Resources Conservation Service
(NRCS), the Farm Service Agency (FSA), and the Forest Service. (Funding for the
Forest Service is provided in the annual Interior appropriations bill, and is not
discussed further.) Conservation spending combines discretionary spending,
requested by the Administration at $1.05 billion for NRCS and FSA in FY2003, and
mandatory funding, currently estimated at just over $3.0 billion for FY2003,
according to Congressional Budget Office (CBO) estimates which includes $1 billion
in new spending authorized by the recently enacted 2002 farm bill (P.L. 107-171).
The new farm bill provides legislative authority, including funding levels, for many
of the mandatory conservation programs through FY2007. Under this law, overall
mandatory conservation funding is forecast by CBO to grow by about 80%,
increasing by a total of $9.2 billion through FY2007 (and $17.1 billion through
FY2011, assuming no changes in policy).
Discretionary Programs. The House Appropriations Committee-reported
bill (H.R. 5263) provides $1.02 billion for all discretionary conservation programs
within USDA, $29 million below the Administration request of $1.049 billion and
$36 million below the FY2002 appropriation of $1.056 billion, which includes $94
million of supplemental spending provided for watershed and flood prevention in
P.L.107-206. The Senate Appropriations Committee-reported bill (S. 2801) provides
$1.044 billion, which is $24 million above the House level. Much of the difference
between the congressional levels and the request is a $48.7 million request for
Emergency Conservation Program that is not included in either bill.
The largest discretionary conservation program is Conservation Operations
(CO), most of which supports technical assistance. The Administration recommends
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an appropriation of $841 million for CO, up $62 million or 8%, compared with the
FY2002 appropriation of $779 million. Of this increase, $48 million would pay for
technical assistance in helping animal feeding operations comply with clean water
regulations. H.R. 2563 provides a CO funding level of $843.6 million for FY2003,
which is $64.6 million above FY2002, and $2 million above the Administration’s
request. S. 2801 recommends $847 million, which is $67 million above FY2002 and
$6 million above the request. The House bill requires NRCS to report on funding
allocations to states within 45 days in response to a concern that the agency is
reducing state allocations in proportion to congressional earmarks rather than treating
earmarks as additions to each state’s allocation.
Both committee reports identify more than 50 earmarks, many of which had
received similar treatment in earlier years. Very few, if any, projects or topics receive
identical earmarks in both bills. The Senate bill specifies that all FY2002 earmarks
are not funded in FY2003 unless specified. Some earmarks are for specific projects
or sites and others are for activities. The largest earmark is for the grazing lands
conservation initiative; H.R. 5263 provides $21.5 million and S. 2801 provides
$23.5 million, even though the recently enacted 2002 farm bill (P.L. 107-171)
authorized appropriations of $60 million annually. H.R. 5263 provides $3 million
for animal waste management pilot projects, while S. 2801 specifies several animal
waste management projects for funding. Both bills encourage NRCS to work with
the National Pork Producers Council on watershed management and demonstration
projects; H.R. 5263 identifies other partners and specifies work at a Texas site. Both
bills identify partners to be involved in specific projects and activities.
The Administration requests no appropriation in FY2003 for its three ongoing
watershed programs: Watershed and Flood Prevention Operations ($200 million
appropriated in FY2002, including a $94 million supplemental appropriation
provided in P.L. 107-206), Watershed Surveys and Planning ($11 million in FY2002)
and Watershed Rehabilitation Program ($10 million in FY2002). Instead, it requests
$110 million for Emergency Watershed Protection, which is the average of annual
spending over the past 10 years, so that USDA would have funds on hand to provide
immediate assistance after a natural disaster. (Currently, the emergency programs
typically are funded in supplemental acts after a disaster strikes, so assistance may
not be available for several months or longer after the damage occurs.
Neither bill concurs with the Administration request to consolidate accounts into
the Emergency Watershed Protection account. Instead, H.R. 5263 recommends $110
million for Watershed and Flood Prevention Operations (with numerous earmarks),
$11.2 million for Watershed Surveys and Planning, and no funding for Emergency
Watershed Protection, while S. 2801 recommends $105 million for Watershed and
Flood Prevention Operations (with numerous earmarks), $11.0 million for Watershed
Surveys and Planning, $30 million for Watershed Rehabilitation, and no funding for
Emergency Watershed Protection. The Senate bill prohibits the use of mandatory
funds from the CCC to carry out the rehabilitation program. The House bill limits
spending for technical assistance to $45.5 million of the total and spending for
activities related to protecting threatened and endangered species to $1 million, while
S. 2801 has no such limits.
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The Administration also requests no funding in FY2003 for the Forestry
Incentives Program, which is terminated by the 2002 farm bill. (It was funded at $7
million in FY2002). The Emergency Conservation Program, an FSA-funded
program which helps producers repair damaged farmland following a disaster, is
usually funded through emergency supplemental appropriations. However, the
Administration assumes that FY2003 spending will be the average of the past 10
years, $48.7 million, and requests the availability of this level of funding in the
regular FY2003 appropriations, which it says would enable it to more rapidly respond
to emergencies. The Administration requests almost level funding for the Resource
Conservation and Development Program, to support activities in designated RC&D
districts, at $49.1 million. Both bills concur by not providing any funding for the
Forestry Incentive Program. S. 2801 recognizes the creation of the new similar
Forest Land Enhancement Program in the 2002 farm bill, and notes that it will
receive a total of $100 million in mandatory funding through FY2007. But they both
differ from the request by not funding the Emergency Conservation Program and by
providing an increase for the Resource Conservation and Development Program; the
House bill increase is more than $7 million, to $55.1 million, while the Senate bill
increase is more than $1 million, to $50.4 million.
Mandatory Programs. The Administration’s FY2003 request was submitted
prior to enactment of the 2002 farm bill, which reauthorized many conservation
programs slated to expire at the end of FY2002. Although the Administration stated
its support for increased mandatory conservation funding in its comments about the
2002 farm bill, its budget request for FY2003 did not include any of the anticipated
increases, except that it requested funding of $200 million for the Environmental
Quality Incentives Program (EQIP) in FY2003. Most of the other mandatory
conservation programs had either reached their authorized ceilings (set in dollars or
acres), or had been unfunded because of limitations enacted each year in
appropriations legislation.
The largest mandatory conservation program is the Conservation Reserve
Program (CRP), which pays farmers to retire from production highly erodible and
environmentally sensitive land. Late last year, USDA reported that there were about
35.1 million acres enrolled in the CRP, almost 10% of the country’s cropland. It was
approaching its ceiling of 36.4 million acres, which was raised to 39.2 million acres
by the 2002 farm bill. The budget assumes FY2003 outlays of $1.856 billion to fund
existing and new contracts. Most other mandatory funding programs will grow
rapidly, as they were reauthorized by the 2002 farm bill. Examples include the
Wetlands Reserve Program, which will grow from 1.075 million acres (by 250,000
acres per year) to 2.275 million acres and the Environmental Quality Incentives
Program, which will grow from $200 million annually to $1.3 billion annually, by the
end of FY2007.
General provisions in H.R. 5263, as reported, limit EQIP funding to $695
million (a savings of $5 million from the authorized level) and limit WRP enrollment
to 245,833 acres in Section 745 (a reduction of 4,177 acres from the authorized level,
or $5 million in savings). H.R. 5263 also limits expenditures for a new mandatory
program, the Conservation Security Program, to a single state, Iowa, making it a pilot
program (savings of $3 million in FY2003). This program will provide assistance
to farmers for the first time in FY2003 to install conservation practices on land in
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production. The Senate Committee bill places one limit on mandatory funding,
prohibiting such funding for the Small Watershed Rehabilitation Program, as noted
above.
For more information on USDA conservation issues, see CRS Issue Brief
IB96030, Soil and Water Conservation Issues, and for more information on the farm
bill conservation provisions, see CRS Report RL31486, Resource Conservation Title
of the 2002 Farm Bill: A Comparison of New Law with Bills Passed by the House
and Senate, and Prior Law.
Agricultural Research, Education, and Economics
The Senate reported bill (S. 2801) provides $2.542 billion for USDA’s four
research, education, and economics (REE) agencies in FY2003, which is $171
million above the House reported (H.R. 5263) level of $2.371 billion. Both bills are
above the Administration request of $2.229 billion – the House by $142 million and
the Senate by $313 million. The Senate level is $100 million above the FY2002
enacted level (including supplementals), while the House level is $71 million below
the aggregate FY2002 appropriations.
Four agencies carry out USDA’s REE function. The Department’s in-house
research agency is the Agricultural Research Service (ARS), which provides
scientific support to USDA’s action and regulatory agencies and conducts long term,
high risk, basic and applied research on subjects of national and regional importance.
The National Agricultural Library merged with ARS in the 1994 USDA
reorganization. The Cooperative State Research, Education, and Extension Service
(CSREES) is the agency through which USDA sends federal funds to land grant
Colleges of Agriculture for state-level research, education and extension programs.
The Economic Research Service (ERS) provides economic analysis of agriculture
issues using its databases as well as data collected by the National Agricultural
Statistics Service (NASS). ARS, CSREES, ERS, and NASS are under the
Undersecretary for Research, Education, and Economics.
Agricultural Research Service (ARS). S. 2801 provides $1.16 billion for
ARS. Of that amount, $1.1 billion would support ARS’s research programs, and
$105 million would support modernizing and building ARS facilities. The Senate
measure represents virtually level funding with FY2002's $1.2 billion regular
appropriation, with an 8.5% increase in the research area and a 12% decrease in
facilities funding. If one takes into consideration the combined supplemental funding
of $138 million that the agency received in two FY2002 supplemental acts (P.L. 107-
117 and P.L. 107-206), the Senate measure provides level funding for ARS research,
but a greater decrease in construction funds.3 The House committee bill (H.R. 5263)
3 P.L. 107-117 provided $50 million to ARS for constructing a high security bio-
containment facility at its National Animal Disease Center in Ames, Iowa, $23 million for
upgrading its foreign animal disease research lab on Plum Island, New York, and $40
million for bioterrorism research. P.L. 107-206 provided an additional $25 million to Ames,
Iowa. Also, included in P.L. 107-206 was $8 million for research on plant and animal
(continued...)
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provides $1.1 billion for ARS – $1 billion for research programs and $95.3 million
for facilities. For all of ARS, H.R. 5263 is $64 million below the level provided in
S. 2801. The President’s budget requested $971.4 million for ARS research and
$16.6 million for construction projects for FY2003.
For FY2003, the Administration proposed reducing spending in certain core
research areas by $15 million and closing certain labs in order to increase funding for
ARS research in selected high priority areas. As in past years, neither the House nor
the Senate Committee bill concurs with these proposals; both measures maintain
funding at FY2002 levels. H.R. 5263 contains language in its report blocking the
expenditure of any funds to conduct a review of the quality and relevance of ARS
research, stating that the National Academy of Science is due to release a similar
study sometime in 2002. S. 2801 contains no comparable language.
Congressional Response to Bioterrorism. The FY2002 emergency
supplemental appropriations act for antiterrorism activities (P.L. 107-206)
appropriated an additional $18 million for the Office of the Secretary to transfer to
ARS, APHIS, AMS, and/or FSIS for counter-terrorism activities, pending an official
budget request from the Administration, which the President has stated he will not
provide. The act also provided ARS an additional $8 million for research on: (1)
mad cow disease and chronic wasting disease, (2) plant genome sequencing, and (3)
cattle genome sequencing, none of which will be provided since the President is not
expected to provide a request. An emergency appropriation of $25 million for
upgrading the animal disease research lab in Ames, Iowa will be provided, since this
provision is not contingent upon an emergency request from the President.
Separately, the recently enacted Public Health Security and Bioterrorism
Response Act of 2002 (P.L. 107-188) authorizes appropriations of $180 million for
ARS research labs in Plum Island, NY and Ames, IA in the current fiscal year and
“such sums as are necessary” for FY2003 through FY2006. The act also authorizes
$190 million for FY2003 and such sums as are necessary for future years for the
Secretary to use: (1) to support ARS, APHIS, Forest Service, and federal-state
cooperative research on bioterrorism prevention, preparedness, and response; (2) to
strengthen coordination with U.S. intelligence agencies; and (3) to develop an early
warning surveillance system for agricultural bioterrorism.
Cooperative State Research, Education, and Extension Service
(CSREES). S. 2801, as reported, provides $1.180 billion for CSREES to use to
support research and extension programs at the land grant colleges of agriculture.
This amount is $118 million higher than the $1.062 million provided by H.R. 5263,
$156 million higher than the FY2002 appropriation of $1.024 million, and $163
million higher than the Administration’s request of $1.017 million.
S. 2801 provides increases in the formula funds for: (1) core research and
extension programs at 1862 land grant institutions: $185.5 million (+ $5.4 million
3 (...continued)
diseases. However, the $8 million was contingent upon a Presidential request and
emergency designation, which the President has stated he will not provide.
CRS-21
from FY2002 and the President’s request; + $3.5 million from the House bill); (2)
forestry research: $22.5 million (+ $.07 million from FY2002 and the budget
request; - $.05 million from H.R. 5263); (3) research at 1890 (historically black) land
grant colleges: $35.6 million (+$1 million from FY2002 and the budget request; (
-$0.4 million compared with H.R. 5263; (4) extension at 1890 colleges: $32.1 million
(+$1 million from FY2002 and the budget request; virtually even with H.R. 5263);
and (5) extension at 1862 institutions : $284.2 million (+$8.3 million from FY2002
and the budget request; +$7.2 million from H.R. 5263).
The House and Senate bills both maintain virtually all of the Special Research
(earmarked) grants that the Administration had proposed for termination. H.R. 5263
provides $102.8 million; S. 2801 provides $103.6 million, compared with $97
million in FY2002. Both bills also continue funding for an additional group of
earmarked grants under the “Federal Administration” portion of the CSREES budget,
providing $27.1 million for those research projects ($21.7 million in FY2002; $7.8
million in the budget request). Finally, S. 2801 provides $164 million for the
National Research Initiative Competitive Research Grants (NRI) program, compared
with $130 million in the House bill. The NRI is funded at $120 million in FY2002,
and the Administration had proposed doubling that amount for FY2003.
Both bills are in agreement with the FY2003 budget request in blocking the
expenditure of $120 million in mandatory funds for the Initiative for Future
Agriculture and Food Systems that was created in separate legislation in 1998. The
2002 farm bill (P.L. 107-171), the recently enacted law that will guide U.S. farm
policy through 2007, reauthorizes the Initiative and gradually increases its funding
from $120 million to $200 million annually in FY2006-07.
Congressional Response to Bioterrorism. The Public Health Security
and Bioterrorism Preparedness and Response Act of 2002 (P.L. 107-188) authorizes
such sums as are necessary for (1) grants not to exceed $50,000 to land grant colleges
of agriculture to review security standards and practices at their facilities; and (2)
grants not to exceed $100,000 to agricultural producer groups to develop and
implement on-farm biosecurity education programs.
The recently enacted FY2002 supplemental appropriations act (P.L. 107-206)
provided an additional $6 million to enhance extension activities related to homeland
security in rural areas, including expansion of the Extension Disaster Education
Network to serve as a rural first-response program. However, these funds were
contingent upon a Presidential request and a budget emergency declaration, which
the President has stated he will not provide.
Economic Research Service (ERS) and National Agricultural
Statistics Service (NASS). S. 2801 provides $65.7 million for ERS, $7.6 million
less than H.R. 5263, $1.5 million less than FY2002, and $13.5 million less than the
Administration request. Most of the difference between the House and Senate levels
and the request is explained by the Administration’s request to transfer funds from
a central account to each individual agency to cover rent paid by each agency to
GSA. For NASS, S. 2801 provides $141.7 million, which is $3.8 million more than
provided by H.R. 5263, $28 million more than the FY2002 appropriation, but $2
million less than the budget request. Both bills designate roughly $41 million for
CRS-22
NASS’s to use to carry out the 2002 Census of Agriculture, as the Administration
requested.
Food Safety and Inspection
USDA’s Food Safety and Inspection Service (FSIS) is responsible for the
mandatory inspection of meat, poultry, and processed egg products to insure their
safety, wholesomeness, and proper labeling. The House Appropriations Committee
bill (H.R. 5263) provides $755.8 million for FSIS in FY2003, compared with $766.6
million in the Senate Appropriations Committee-reported bill (S. 2801) and a total
FY2002 appropriation of $715.6 million including a supplemental. Both bills assume
that FSIS will have access to an additional $101 million in user fee income to support
its inspection activities. Neither bill concurs with the President’s request for an
additional $7.3 million in appropriations to accommodate a one-time shift of funds
to cover rental payments to GSA. S. 2801 includes $5 million specifically for FSIS
to hire at least 50 additional personnel to enforce the Humane Methods of Slaughter
Act. Senate committee members also added language calling for more stringent
monitoring of foreign establishments exporting meat and poultry to the United States,
and for a response to the Committee within 60 days to an upcoming GAO report that
is critical of FSIS’s inspection standards.

The Administration’s budget request proposed to revise the current user fee
system to reduce the rates charged for overtime inspection and instead increase the
industry’s reimbursement to the government for inspection on second and third shifts.
The budget also included a proposal to assess processing establishments an annual
licensing fee. Both bills are silent on these issues.
The recently enacted Public Health Security and Bioterrorism Preparedness and
Response Act of 2002 (P.L. 107-188) authorizes a $15 million appropriation in
FY2002, and such sums as necessary thereafter, for enhancing FSIS’s ability to
inspect domestic and imported meat and poultry. Separately, the conference
agreement on the FY2002 supplemental appropriations bill (H.R. 4775) provides
$13 million to FSIS to cover the costs of reviewing foreign countries’ meat and
poultry inspection regimes, visiting additional foreign plants specifically to address
post-September 11 concerns, and purchasing information technology systems so that
FSIS can improve its communications with other agencies to track imported products
and assess their risk.
Marketing and Regulatory Programs
USDA’s marketing and regulatory programs (MRP) are administered by three
agencies: the Agricultural Marketing Service (AMS), the Animal and Plant Health
Inspection Service (APHIS), and the Grain Inspection, Packers, and Stockyards
Administration (GIPSA). The stated mission of these programs is to “expand
domestic and international marketing of U.S. agricultural products and to protect the
health and care of animals and plants, by improving market competitiveness and the
farm economy for the overall benefit of both consumers and American agriculture.”
For FY2003, the Administration requested $879.9 million for USDA’s three
marketing and regulatory agencies compared with a total FY2002 appropriation of
CRS-23
$867.3 million (included emergency supplemental appropriations of $119.1 million,
intended to protect the food supply against agricultural terrorist threats). The House
Appropriations Committee-reported bill (H.R. 5263) provides $886.6 million for
MRP, or $19.3 million over FY2002 regular and supplemental appropriations. The
Senate Appropriation Committee-reported bill (S. 2801) provides $886.5 million.
Animal and Plant Health Inspection Service. The largest appropriation
for marketing and regulatory programs goes to USDA’s Animal and Plant Health
Inspection Service (APHIS), the agency responsible for protecting U.S. agriculture
from foreign pests and diseases. The Administration requested an FY2003
appropriation of $767.1 million for APHIS, compared with a total FY2002
appropriation of $746.8 million (including supplemental appropriations of $119.1
million.)4 The Administration’s proposed increase in total funding reflects the
agency’s increased responsibilities to protect against acts of terrorism. H.R. 5263
and S. 2801 provide nearly identical amounts of $749 million, which are $2.4 million
above FY2002, but $26.2 million below the FY2003 Administration request. Most
of the shortfall from the Administration request is attributed to the requested one-
time shift in funds ($26.7 million) to cover GSA rental costs, which is not included
in the Committee proposals. Both bills also provide for increases in APHIS’ salaries
and expenses for stepped-up border inspections, and for the Animal Health
Monitoring and Surveillance (AHM&M) activities. In addition, both bills include
increased funding for the boll weevil, emerging plant pests, Johne’s disease, and
Wildlife Services programs.
The President also requested increased appropriations to fund new emergency
pest programs, such as the current “chronic wasting disease” outbreak in deer and
elk, and for controlling other invasive species. In recent times, these programs have
been funded mostly under the Secretary’s emergency authorities through the
Commodity Credit Corporation (CCC). Similar requests for additional
appropriations in lieu of CCC funds were advanced by the previous Administration.
The Administration is concerned about the rising cost of emergency pest outbreaks
($235 million in FY2001), and expects to seek public comment on ways to share
these costs with the states and the private sector. The Appropriations Committees,
as Congress routinely has done in the past, have rejected this request, and instead
encourage USDA to continue use of the CCC funding mechanism to address
emergency needs.
Proposed Department of Homeland Security. Recently, two
Congressional measures (H.R. 5005 and S. 2452), and the Bush Administration
proposed the transfer of APHIS functions to a new Department of Homeland
Security (DHS). (See CRS Report RL31466, Homeland Security Department: U.S.
Department of Agriculture Issues). Although enactment of these measures could
impact future appropriation measures, the current appropriations’ process is
proceeding as though APHIS will remain within USDA. A general provision in H.R.
5263 forbids money transfers between USDA and other departments (presumably
4 An additional emergency supplemental appropriation of $33 million for APHIS’ salaries
and expenses is provided in the conference report to H.R. 4775, which has passed both
houses and now awaits presidential action.
CRS-24
referring to DHS) unless authorized by appropriators. APHIS quarantine inspection
functions are largely funded through Agricultural Quarantine Inspection (AQI) user
fees5, and to a lesser extent from annual appropriations. In 2001, APHIS’ AQI
account was $286 million ($238 million from user fees + $48 million from
appropriations). APHIS is currently evaluating the complete budgetary impact of
Senate and House proposals which could transfer up to 3,200 full-time employees
to the new department.
Agricultural Marketing Service. AMS is responsible for promoting U.S.
agricultural products in domestic and international markets, and for facilitating the
marketing and distribution of agricultural products. The Administration requested
FY2003 appropriations of $91.7 million for AMS, compared with $86.8 million in
FY2002. These levels include Section 32 funds, and payments to states and
territories. Not included in the appropriated level are $190 million in collected user
fees. The President’s request included funding for expanding global marketing
opportunities for agricultural commodities and for improving the Federal Seed
program which monitors and controls seed labeling for domestic and foreign sales.
H.R. 5263 provides $91.96 million for AMS, which is $5.2 million over FY2002
levels, and $0.1 million over the Administration’s request. S. 2801 provides $92.1
million, a slightly higher level than the House. Included in the committee reports
are provisions for increased funding of the Pesticide and Microbiological Data
programs. The Senate, in addition, increases funding for implementing the
Mandatory Price Reporting Act of 1999 (P.L. 106-78).
Grain Inspection, Packers, and Stockyards Administration. GIPSA
establishes the official U.S. standards, inspection and grading for grain and other
commodities, and ensures fair-trading practices. GIPSA has also been working to
improve monitoring of livestock markets, where concentration has raised concerns
about decreasing competition. The Administration requested $12.2 million for
GIPSA in FY2003, down $20.9 million from the $33.1 million provided in FY2002.
To cover the shortfall, the Administration had included a proposed increase of $29
million in new user fees, which if enacted would be used to fund Packers and
Stockyards Act inspections, and grain standard testing activities. Similar requests for
new user fees by the Clinton Administration were not adopted by Congress. H.R.
5263 and S. 2801 increase GIPSA funding to $44.7 million, an increase of $11.6
million over FY2002. The House bill directs the Secretary to conduct a 2-year study
on packer ownership of livestock ($4.5 million).
Proposed Livestock Competition Amendments. Producer groups and
policymakers are interested in changing the structure and business methods of the
livestock industry in an attempt to make livestock producers more competitive.
Issues include concern over the consolidation of production and processing into
fewer and larger operations, increased vertical integration (i.e., ownership or
increased control of more than one phase of production and marketing by a single
5 AQI user fees are authorized under the 1990 Farm Bill (§ 2509(a) of the Food, Agriculture,
Conservation, & Trade Act (P.L. 101-624), which allows APHIS to charge for AQI activities
at ports of entry in order to cover its costs. Collected AQI user fees remain available to the
Secretary until expended without fiscal year limitation.
CRS-25
firm), and the gradual shift from mainly open cash markets to private contracts or
other marketing agreements between buyers and sellers. Livestock market issues
were addressed during the debate of the recently enacted 2002 farm bill (P.L. 107-
171). Certain key issues were not included in the final legislation. Hence, these
issues might resurface as floor amendments to the FY2003 agriculture appropriations
bill.
The Senate-passed farm bill (S. 1731) contained a provision that would have
banned packer ownership or significant control of livestock, with an exemption for
producer-owned cooperatives and small, producer-owned packers. The proposed ban
was dropped in conference with House conferees generally opposed, but several
members have considered proposing a similar ban as a floor amendment to H.R.
5263 and S. 2801. Supporters of the ban believe it will limit packers’ ability to
manipulate the market, and would improve farmers’ access to livestock markets.
They are concerned about the pace of vertical integration in the livestock industry and
believe the ban is a way to stop or slow down vertical integration. Opponents of the
ban argued it could create turmoil in the industry as packers and producers have to
undo relationships built over time, and would reverse many of the production
efficiency gains that had come about through closer packer-producer alliances.
A separate proposal that also might be offered as an amendment to H.R. 5263
or S. 2801 would require packers to increase the percentage of livestock they buy on
the spot market. Specifically, packers would have to purchase on the spot market at
least 5% of their slaughter needs by 2004, and at least 25% by 2008.
For more information, see IB10063, Animal Agriculture Issues in the 107th
Congress.
Rural Development
USDA’s rural development mission is to enhance rural communities by
targeting financial and technical resources in areas of greatest need. Three agencies,
established by the Agricultural Reorganization Act of 1994 (P.L.103-354), are
responsible for the mission area: the Rural Housing Service (RHS), the Rural
Business-Cooperative Service (RBS), and the Rural Utilities Service (RUS). An
Office of Community Development provides community development support
through Rural Development’s field offices. The mission area also administers the
rural portion of the Empowerment Zones and Enterprise Communities Initiative and
the National Rural Development Partnership.
The Senate Appropriations Committee-reported bill (S. 2801) recommends
$2.745 billion in budget authority to support a $9.857 billion loan authorization level
for rural economic and community development programs in FY2003. This is $175
million more than was enacted for FY2002 and $77 million more than provided by
the House Appropriations Committee-reported bill (H.R. 5263). It is also $158
million more than requested. Funding in the House and Senate bills supports a loan
authorization level of $9.68 billion and $9.86 billion, respectively, in direct and
guaranteed rural development loans, both of which are well above the Administration
request for $7.2 billion in loan authorization.
CRS-26
Rural Community Advancement Program (RCAP). The RCAP,
authorized by the 1996 farm bill (P.L. 104-127), consolidates funding for 13 rural
development loan and grant programs into three accounts: Community Facilities,
Rural Utilities, and Business and Cooperative Services. RCAP was designed to
provide greater flexibility in targeting financial assistance to local needs and permits
a portion of the various accounts’ funds to be shifted from one funding stream to
another. S. 2801 provides $867.2 million in budget authority for the three RCAP
accounts, $83 million less than the $950 million provided in H.R. 5263, and $60.6
million more than enacted for FY2002.
S. 2801 provides funding of $97.6 million for the Community Facilities account,
over twice the level recommended by H.R. 5263; $682.8 million for the Rural
Utilities account; and $86.8 million for the Rural Business Services account. As with
the House bill, most of the RCAP authorization in S. 2801 would support water and
waste disposal grants in the Rural Utilities account, although at $132 million less
than in H.R. 5263.
Both Senate and House bill language earmarks funding for water and waste
disposal programs in Alaskan native villages, Federally Recognized Native American
Tribes, and the Colonias. Senate bill language also designates $10 million to the
Rural Community Development Initiative, $4 million of which is provided to a
demonstration program for Replicating and Creating Rural Cooperative Home Based
Health Care and $6 million for developing capacity for private, non-profit
organizations to improve housing, community facilities, and economic development
projects for low-income rural communities. The Senate bill designates $30 million
of RCAP funding to communities facing extremely high energy costs, and $25
million for grants to facilities in rural communities with extreme unemployment and
economic distress. Both bills provide $37.6 million to empowerment zones and
enterprise communities designated by the Secretary as Rural Economic Area
Partnership Zones (REAP). Most of the latter’s budget authority is for rural utility
programs.
The FY2002 supplemental appropriations act (P.L. 107-206) provided an
additional $20 million in emergency spending to RCAP’s rural utilities account. Up
to $5 million of this supplemental funding would have been provided to conduct a
national assessment of the vulnerability of rural water systems to terrorist/criminal
attack. However, this funding is available only to the extent an official budget
request that includes designation of the entire amount of the request as an emergency
requirement is transmitted by the President to the Congress. The President has stated
he will not request the contingent funds provided in P.L. 107-206.
Rural Housing Service. S. 2801 provides $1.589 billion for the RHS in
FY2003 to support a total rural housing loan authorization level of $3.932 billion.
This loan authorization amount is $13 more than in H.R. 5263 and is $115.3 more
than enacted for FY2002. The Senate bill recommends $282.5 million in housing
loan subsidies, $21 million more than the House bill, and $32 million more than
Administration requested loan subsidies.
The Senate bill rejects the Administration’s request that there be no new
construction of Section 515 rental housing for low-income rural residents. The
CRS-27
Administration had requested no new construction until the Department completes
a review of Section 515 multi-family housing. S. 2801 recommends that $50 million
be made available for new construction, $50 million for repair and rehabilitation,
with $20 million to be used for equity loans. This is a total of $60 million more than
requested. The Senate also recommends $28 million in direct loan subsidies for
Section 515 rental housing, the same as requested. The House bill provides $26
million more for Section 515 loan subsidies.
S. 2801 recommends $17 million for farm labor housing grants, the same as
requested and $3 million less than H.R. 5263. For the Rural Housing Assistance
Grants, the Senate recommends $47.5 million, $5 million more than the House bill
provides. Both House and Senate bills recommend $35 million for mutual and self-
help housing grants.
The Senate committee report rejects a Department request for $2 million to do
an independent study of cost efficiencies in delivery of multi-family housing, instead
providing $1 million to conduct a study of capital need as recommended by GAO.
Under a general provision, the Senate bill also earmarks $4 million under the Rural
Housing Assistance grant account for a demonstration housing program for
agricultural processing workers in Wisconsin.
Rural Utilities Service. S. 2801 recommends $108 million in budget
authority to support a loan level of $5.87 billion for rural utility programs. The
Senate budget authority level for RUS programs is $8 million more than the House
level, $23.3 million more than the Administration’s request, and roughly equal to the
enacted level in FY2002. Almost all loan authorization ($5.87 billion) is designated
for the rural electrification and telecommunications account. Part of this loan
authorization includes $1 billion for guaranteed underwriting of a cushion of credit
payments under Section 313A of the Rural Electrification Act of 1936. (7 U.S.C.
940(c)). Loan authorization for the account is nearly $500 million more than enacted
in FY2002 and $2.6 billion more than requested. It is also $800 million more loan
authority than in the House provision.
For the Rural Telephone Bank (RTB), both the House and Senate bills
recommend a loan level of $174.6 million. There was no Administration request.
In furtherance of the privatization of the RTB, both bills include the same provision
from FY2002 to limit the retirement of Class A stock to 5%.
In other RUS programs, S. 2801 provides loan subsidies and grants of $51.9
million for the Distance Learning and Telemedicine program. This is $2 million
more than enacted in FY2002 and $7 million more than in H.R. 5263. The loan
authorization level for the program is authorized at $129.5 million, the same as
requested, but $251 million less than recommended by the House bill. Authorization
of $2 million in grants is also recommended for the Rural Teleworks Program. Both
bills recommend no funding for the Local Television Loan Guarantee program,
whose loan level was authorized at $258 million in FY2002. Both bills also
recommend no authorization for direct loans. Through a $20 million rescission, the
FY2002 supplemental appropriations act (P.L. 107-206) provides $8 million in
additional funding for the Local Television Loan Guarantee Program account, to
remain available until expended. Direct authorization of $80 million for local
CRS-28
television broadcast loan guarantees is also included in of the recently enacted farm
bill (P.L.107-171).
Rural Business-Cooperative Service. The House and Senate bills provide
nearly identical amounts for the RBS accounts to support rural business development
and expansion – $50.658 million in H.R. 5263 and $50.758 million in S. 2801, which
are about $15 million more than the Administration request. The Senate bill also
earmarks $5 million of direct loan subsidies to Federally Recognized Native
American Tribes and Mississippi Delta Region counties.
Within the totals, both bills provide $14.97 million for the Empowerment
Zone/Enterprise Community Initiative. No funding for the program was requested.
Funding for Rural Cooperative Development Grants is $9 million in both bills, an
increase of $1.25 million above FY2002 and the same as requested by the
Administration. The Senate Committee also designates $2.5 million of this grant
funding to cooperative agreements for the Appropriate Technology Transfer
Program.
Other Provisions. S. 2801 makes two general provisions prohibiting the
expenditure of any funds to carry out the following programs of the recently enacted
2002 farm bill (P.L.107-171): (1) the Rural Strategic Investment Program (Section
6030) and (2) the Rural Firefighters and Emergency Personnel Training Program
(Section 6405). The Senate report language further recommends reducing budget
authority to $50 million from $150 million for ethanol plant development (Section
9010). Finally, the Senate Committee recommends $2 million for the National Rural
Development Partnership (NRDP). The House bill does not affect funding levels for
any mandatory rural development programs authorized by the farm bill.
For additional information on USDA rural development programs, see “Rural
Development”, CRS Electronic Briefing Book page.
Food and Nutrition
For FY2003, the Administration requests an appropriation of $41.87 billion for
all USDA food and nutrition programs, an increase of about $4 billion above the
FY2002 appropriation. The House Appropriations Committee-reported bill (H.R.
5263) provides $41.97 billion for these programs, which is about $100 million more
than the Administration request. The Senate Appropriations Committee-reported bill
(S. 2801) provides $41.93 billion; $84 million less than the House level. These
programs provide federal funding and commodities to states for food assistance to
children in schools and other children’s facilities, and for low-income individuals
and families.
The Administration budget recommends a total of $26.25 billion for food
stamps and related programs for FY2003, $3.25 billion more than FY2002. This
includes food stamp program expenses, a reserve fund, nutrition assistance for Puerto
Rico and Samoa and funding to buy commodities for the emergency food assistance
program (EFAP). Both H.R. 5263 and S. 2801 provide the same amounts for food
stamp expenses and the food distribution program on Indian Reservations (FDPIR)
– $22.77 billion – and for a food stamp reserve fund ($2 billion). However, the
CRS-29
Administration request and the Senate bill contain $1.377 billion for Puerto Rico and
Samoa. The House bill funds this at $1.401 billion, because, according to the
committee report, of additional mandatory spending requirements for these programs
under the 2002 farm bill (P.L. 107-171). Funding to buy commodities for EFAP
would be $140 million under both S. 2801 and H.R. 5263; the Administration
proposed only $100 million for this purpose, the same as in FY2002. The
Administration budget anticipates food stamp participation growth of about 800,000
in FY2003, or about 4% above FY2002 for a total of 20.6 million persons in
FY2003. P.L.107-171 restored food stamp eligibility for legal immigrants residing
in the U.S. for at least 5 years and changed the quality control system, employment
rules, and deductions.
H.R. 5263 funds all child nutrition programs at $10.58 billion, in concurrence
with the Administration request. S. 2801 is slightly higher, providing $4 million in
discretionary spending to continue school breakfast program start-up grants of $3
million; $200,000 for the Food Works of Vermont Common Roots program; and
$500,000 for an archive resource center at the National Food Service Management
Institute. The funding level for the mandatory feeding programs is expected to
maintain full program participation for the school lunch, breakfast, child and adult
care food, summer food service, and special milk programs, as well as other related
support activities.
The Senate bill provides $4.751 billion in FY2003 for the special nutrition
program for women, infants and children (WIC) in concurrence with the
Administration request. This represents an increase of $289 million from the total
FY2002 appropriation of $4.462 billion. The FY2002 level includes two emergency
supplemental appropriations ($39 million in P.L. 107-117 and $75 million in P.L.
107-206). It also includes a $150 million contingency reserve. H.R. 5263 provides
$4.776 billion, or $25 million more than the Administration and Senate for WIC for
FY2003. All three proposals contain the $150 million contingency reserve fund.
According to USDA estimates, WIC is expected to serve a monthly average of 7.8
million low-income pregnant and postpartum mothers and young children under the
Administration’s FY2003 proposed funding level.
Funding for the Commodity Assistance Program (the term used by appropriators
to refer to the Commodity Supplemental Food Program (CSFP) and for
administrative funds for the EFAP) would decline under the Administration proposal
– from $149.5 million in FY2002 to just under $145 million in FY2003. The House
bill increases funding for these two programs to $170 million in FY2003; of this
amount, $120 million would go for the CSFP and $50 million for TEFAP
administrative expenses. The House Appropriations Committee recommends that all
of the increase go for the CSFP; TEFAP administrative costs would remain at the
FY2002 level of $50 million. The Senate bill is $167 million below the House level
and requires that $5 million of the amount provided must be used for senior farmers’
market activities.
No FY2003 funding is requested in the USDA budget for the elderly nutrition
program, a food donation program that provides mostly cash-in-lieu of commodities
to support meal programs for senior citizens. The Administration proposes to merge
this program with the larger meal programs operated for senior citizens under the
CRS-30
Older Americans Act by the Department of Health and Human Services. Both House
and Senate appropriators agreed to the Administration proposal to zero out elderly
program FY2003 funding for USDA ($149.7 million in FY2002). Pacific Island
and Disaster Assistance would continue to be funded at $1.081 million under the
Administration request and both bills.
Other nutrition program provisions in H.R. 5263 would: (1) provide $4 million
for Bill Emerson and Mickey Leland Hunger Fellowships, (2) permit the USDA
Secretary to use up to $10 million of food stamp funds designated for buying EFAP
commodities for costs associated with the distribution of commodities, and (3)
prohibit the use of any child nutrition, WIC, or food stamp funds from being used by
the Food and Nutrition Service (FNS) to conduct studies or evaluations, with some
exceptions. S. 2801 differs in several respects from these House proposals. S. 2801
provides $2.5 million for Emerson and Leland Hunger Fellowships, and permits the
Secretary to use up to $5 million of food stamp funds for costs associated with the
distribution of commodities under EFAP. It also allows up to $3.195 million for
program evaluations and studies by the Food and Nutrition Service and not more than
$500,000 of this amount to be transferred to the Economic Research Service (ERS)
of USDA. ERS is the unit that would conduct studies and evaluations under the
House bill.
Food and Drug Administration
The Food and Drug Administration (FDA), an agency of the Department of
Health and Human Services (DHHS), is responsible for the regulation and safety of
foods, drugs, biologics (vaccines), and medical devices. The agency’s funding comes
from a combination of congressional appropriations and user fees, fees primarily
collected for the review of pharmaceuticals. The total amount of drug user fees to
be collected is set each year in FDA’s annual appropriations act. The bill reported
by the House Appropriations Committee (H.R. 5263) provides for total FDA funding
of $1.385 billion for FY2003, an increase of $15.7 million above the FY2002
appropriation of $1.218 billion and $7.3 million above the FY2003 Administration
request of $1.377 billion. The Senate Appropriations Committee-reported bill (S.
2801) provides a total of $1.404 billion, which is $19 million above the House level,
$34.7 million above the FY2002 appropriation and $26 million over the request. Of
this total amount, H.R. 5263 provides $1.377 billion for salaries and expenses
(compared with $1.393 billion in S. 2801), and $8 million for the maintenance of
buildings and facilities (compared with $11 million in S. 2801). The House total,
including salaries and expenses, user fees, and facilities amounts to $1.608 billion,
while the Senate total comes to $1.638 billion.
Both the House and Senate Committees provide $222.9 million to be collected
in FY2003 for drug user fees under the newly reauthorized Prescription Drug User
Fee Act (PDUFA) for the approval of drug applications. Congress reauthorized
PDUFA in May 2002 with language incorporated into the Public Health Security and
Bioterrorism Preparedness and Response Act of 2002 (P.L. 107-188). An additional
$22.5 million will be collected from mammography clinics and export certificates,
bringing the user fee total to $245.4 million in FY2003.
CRS-31
H.R. 5263 supports the President’s FY2003 budget request of $159.1 million,
while S. 2801 provides $152.3 million for counter-terrorism activities initiated by the
agency during the previous year. In FY 2002, supplemental funds for bioterrorism
were used to hire 673 new employees and improve FDA’s capacity to respond to
terrorist threats.
The two bills provide different funding levels for FY2003 for several budget
categories. For instance, both committees direct FDA to continue funding the Office
of Women’s Health, but the House sets aside $1.5 million in FY2003 for this activity,
while the Senate doubles the amount to $3 million. The House committee fully funds
the Administration’s $8.3 million request to upgrade its financial management
system, but the Senate committee says that these fund were already provided in the
FY 2002 budget through reprogramming, and are no longer necessary.
Both committee reports prohibit the FDA from spending any money on several
administrative actions involving agency personnel. One such restriction would
prevent the agency from transferring and consolidating FDA’s Offices of Public
Affairs and Legislation to within the DHHS. Because these offices handle
assurances on food safety, drugs, vaccines, and medical devices, FDA officials in
these offices rely on the expertise found in other parts of the agency. For these
reasons, both committees disagree with the consolidation and say they want the office
to remain part of the FDA.
The reauthorization of PDUFA will likely reopen the debate on the issue of
charging user fees for the approval of medical devices and animal drugs. An
amendment establishing user fees for these products was offered, but was dropped
during consideration of the bioterrorism bill, which included the reauthorization of
PDUFA. The proposals may re-emerge as a floor amendment to the FY2003
appropriations bill.
Food Issues
H.R. 5263 does not include a specific level of funding for food safety, but the
Senate committee, noting the expansion of FDA activities under the category of
“Food Safety Initiative” recommends a total of $504.8 million in S. 2801 for this
purpose. House report language requests a summary of the case-controlled studies
that link naturally-occurring bacterial pathogens to specific foods – i.e., E. coli,
Salmonella, Campylobacter, and Listeria found on meat, poultry, eggs, seafood,
fruits and vegetables. In addition, both bills support further progress in the detection
of the pathogens; the Senate provides $2 million for FDA to continue the evaluation
of new testing methods for pathogens at New Mexico State University.
In report language, the House Appropriations Committee expresses displeasure
with the agency’s failure to produce a report detailing how the FDA allocates money
to the National Antimicrobial Resistance Monitoring System (NARMS) activities
and overhead costs. The House Committee wants the report within 60 days of
enactment of the FY2003 appropriations bill. The Senate Committee does not
mention a report but did comment that the NARMS data should be unbiased, timely,
and accurate.
CRS-32

Seafood safety is of concern to both committees. Both direct the FDA to spend
$250,000 to continue support for shellfish safety research and study Vibrio vulnificus,
a pathogen found in raw oysters. Both committees want FDA to continue its work
with the Interstate Shellfish Sanitation Conference on the development of
regulations, and information on shellfish. The Senate committee also wants FDA to
encourage the development of cost effective technologies for seafood, and wants
special care taken when FDA inspects seafood plants in both Hawaii and Alaska.
The House directs FDA to enforce U.S. dietary supplement laws, and stop
producers of the so-called herbal product “Siberian ginseng” from labeling and
referring to their product as “ginseng.” The Senate Committee is interested in the
potential positive health benefits of Omega 3, a fatty acid, quantities of which are
found in salmon. The committee wants FDA to report on whether canned and fresh
salmon should bear a label reflecting the benefits of Omega 3.
The House committee commends FDA for its recent statement that adverse
event reports (AERs) regarding dietary supplements containing ephedrine alkaloids
do not alone provide a scientific basis for assessing the safety of these herbal and
supplement products. Ephedrine alkaloid, a central nervous system stimulant, is an
active ingredient in a variety of dietary supplements and over-the-counter
medications. The Senate committee, also concerned about AERs, provides $7.6
million for the food center’s adverse event system – called CAERS. Of this amount,
the Senate Committee requires $1.5 million be spent on tracking adverse events
related to dietary supplements.
Drug Issues
Both the House and Senate bill reports recognize that the timely approval of
generic drugs is an important factor in addressing the rising cost of prescription
drugs. To this end, the House recommends a funding level of $4.58 million for
FDA’s generic drug program. By comparison, the Senate provides $45.3 million, a
significant increase in funding for the same program. Both committees said they
expect FDA to review 75% of the abbreviated new drug applications (ANDAs) for
generic drugs within six months of submission. Moreover, within 90 days of
enactment, the House committee expects the agency to come up with a plan
describing how it will review 100% of ANDAs within 180 days of submission, and
the resources the program would need to upgrade inspections, infrastructure, and
technological requirements. In addition, the House committee recommends $400,000
to continue FDA’s education program about the importance of generic drugs,
particularly studies on consumer education. Further, the House committee directs the
agency to issue a final guidance for drug makers clarifying the requirements for
listing patents in the Orange Book, the official publication where FDA lists patent
information for pharmaceutical products. The House committee also wants to ensure
that the Office of Drug Safety receives at least a $5 million increase for FY2003, as
authorized in the 2002 bioterrorism act to continue its post marketing surveillance
for pharmaceuticals. The Senate committee makes no such comparable
authorization.
CRS-33
Medical Device Issues
Both committees express concern about delays in review for new medical
devices and the impact it was having on the health of Americans. In last year’s
appropriations conference report, FDA was directed to provide an update of its
medical device review performance, as compared to statutory requirements for
application decisions, to the House committee in January and July 2002. To date, the
updated report has not been submitted. The House committee directs the FDA to
develop a plan to eliminate the medical device performance gap within 90 days of
enactment. The plan is to include an estimate of the resources needed, and specify
how the agency would meet statutory timeframes for application reviews and
inspections, and what infrastructure and technology upgrades would be required. The
House committee notes that many applications for medical devices are for
combination products that involve consultation with FDA’s Center for Biologics
Evaluation and Research (CBER). The House committee asks for a report by May
31, 2003, on the prevalence of combination products, and how the review times for
these products compare with standard medical devices.
By contrast, the Senate committee provides an increase of $8 million from the
FY2002 level for activities related to pre-market reviews of medical devices, with the
money to be used solely for pre-market reviews. Moreover, the Senate committee
directs the agency to provide a report, within 90 days, on how these funds will be
spent, including the number of employees that will be hired, a description of their
duties, and the effects the funds will have on pre-market review times. Also, the
Committee expresses concern that FDA may consider allowing a single pre-market
submission for reprocessing of multiple models of certain medical devices, and as
such, urged the agency to require a pre-market submission for every model that is to
be reprocessed, if an application was required for the original device.
Biologics Issues
The House committee encourages Center for Biologics Evaluation and Research
to allocate adequate resources to the Office of Blood Research and Review to
promote the timely review of new intravenous immune globulin (IGIV) products that
have been submitted for licensure using the revised clinical trial protocol. In
addition, the House committee urges the FDA to develop a feasability plan for a
‘Fast-Track’ program to facilitate the awarding of Investigational New Drug status
to new vaccine candidates, particularly HIV vaccines, and submit a progress report
towards implementing the program by March 1, 2003. The Senate committee is
concerned about the safety of tissue processing. Since 1997, FDA has proposed
several new regulations dealing with the registration of tissue processors, the listing
of tissue products, and good manufacturing practices. Thus far, FDA has finalized
only the rule dealing with registration, and the committee directs the the agency to
finalize the tissue safety rules within 9 months of enactment.
CRS-34
Table 4. USDA and Related Agencies Appropriations for FY2003
Budget Authority
($ in millions)
FY2003
FY2003
FY2003
FY2002
Admini-
House
FY2003
Senate
Agency or Major Program
Enacted
stration
Bill
Enacted
Bill
(1)
Request
(H.R.
(S. 2801)
(2)
5263)
Title I — Agricultural Programs
Agric. Research Service (ARS)
***
Regular Appropriation
1,098.5
988.0
1,097.5
1,161.7
Supplemental Appropriations
138.0
0
0
0
Coop. State Research Education
1,024.4
1,017.4
1,062.3
1,172.9
***
and Extension Service (CSREES)
Economic Research Service (ERS)
67.2
79.2
73.3
65.7
***
National Agricultural Statistics
113.8
143.7
137.9
141.7
***
Service (NASS)
Animal Plant Health and
***
Inspection Service (APHIS)
Regular Appropriation
627.7
775.3
749.1
748.9
Supplemental Appropriation
119.1
0
0
0
Agric. Marketing Service (AMS)
86.8
91.7
92.0
92.1
***
Grain Inspection , Packers and
33.1
12.2
44.7
44.7
***
Stockyards Admin. (GIPSA)
(3)
Food Safety and Insp. Serv (FSIS)
***
Regular Appropriation
715.6
763.0
755.8
766.6
Supplemental Appropriation
15.0
0
0
0
Farm Service Agency (FSA)
939.0
993.6
976.7
997.4
***
Salaries and Expenses
FSA Farm Loans - Subsidy Level
187.6
212.1
212.1
243.8
***
*Farm Loan Authorization
3,890.7
3,802.0
3,802.0
4,065.7
***
FSA Farm Loans- Salaries and
280.6
287.2
287.2
287.2
***
Administrative Expenses
Emergency Conservation Program
0
48.7
0
0
Risk Management Agency (RMA)
74.75
72.8
70.7
71.2
***
Salaries and Expenses
Federal Crop Insur. Corp. Fund (4)
2,900.0
2,886.2
2,886.0
2,886.2
***
Commodity Credit Corp. (CCC) (4) 20,279.0 16,285.0 16,285.0 16,285.0
***
Other :
***
Regular Appropriation
478.5
541.0
642.7
627.9
Supplemental Appropriation
80.9
0
0
0
Total, Agricultural Programs
***
Regular Appropriation
28,899.7 25,197.0 25,373.4 25,593.0
Supplemental Appropriations
353.0
0
0
0
CRS-35
FY2003
FY2003
FY2003
FY2002
Admini-
House
FY2003
Senate
Agency or Major Program
Enacted
stration
Bill
Enacted
Bill
(1)
Request
(H.R.
(S. 2801)
(2)
5263)
Title II — Conservation Programs
Conservation Operations
779.0
841.0
843.6
847.0
***
Watershed Surveys and Planning
11.0
0
11.2
11.0
***
Watershed & Flood Prevention
Regular Appropriation
106.6
0
110.0
105.0
***
Supplemental Appropriation
94.0
0
0
0
Watershed Rehabilitation Program
10.0
0
0
30.0
***
Emergency Watershed Protection
0
110.0
0
0
***
Resource Conservation & Developm.
48.0
49.1
55.1
50.4
***
Forestry Incentives Program
6.8
0
0
0
***
Total, Conservation
***
Regular Appropriation
962.1
1,000.9
1,020.6
1,044.2
Supplemental Appropriation
94.0
0
0
0
Title III — Rural Development
Rural Community Advancement
806.6
791.5
950.3
867.2
***
Program (RCAP)
Salaries and Expenses
133.7
145.7
145.7
134.0
***
Rural Housing Service (RHS)
1,474.5
1,528.5
1,576.0
1,585.3
***
* RHS Loan Authority
4,485.8
3,924.3
4,551.5
3,932.2
***
Rural Business Cooperative Serv.
46.6
35.8
50.7
50.8
***
* RBCS Loan Authority
53.1
55.0
55.0
55.0
***
Rural Utilities Service (RUS)
***
Regular Appropriation
120.0
84.6
99.9
107.9
Rescission
(8.0)
0
0
0
* RUS Loan Authority
5,378.6
3,272.6
5,070.7
5,870.3
***
Total, Rural Development
***
Regular Appropriation
2,581.9
2,587.1
2,823.3
2,746.0
Rescission
(8.0)
0
0
0
* Rural Development, Total Loan
9,917.6
7,224.9
9,677.2
9,857.4
***
Authority
Title IV — Domestic Food Programs
Child Nutrition Programs
10,087.2 10,576.2 10,576.2 10,580.2
***
WIC Program
***
Regular Appropriation
4,348.0
4,751.0
4,776.0
4,751.0
Supplemental Appropriations
114.0
0
0
0
Food Stamp Program
22,992.0 26,249.7 26,313.7 26,289.7
***
CRS-36
FY2003
FY2003
FY2003
FY2002
Admini-
House
FY2003
Senate
Agency or Major Program
Enacted
stration
Bill
Enacted
Bill
(1)
Request
(H.R.
(S. 2801)
(2)
5263)
Commodity Assistance Program (5)
149.5
145.0
170.0
167.0
***
Food Donation Programs
150.7
1.1
1.1
1.1
***
Other
128.2
148.7
135.0
138.9
***
Total, Food Programs
***
Regular Appropriation
37,894.6 41,871.7 41,971.9 41,927.9
Supplemental Appropriations
114.0
0
0
0
Title V — Foreign Assistance
Foreign Agric. Service (FAS)
121.8
131.7
130.0
131.9
***
Public Law (P.L.) 480
998.7
1,314.0
1,357.1
1,328.4
***
CCC Export Loan Salaries
4.0
4.1
4.1
4.1
***
Total, Foreign Assistance
1,124.5
1,449.6
1,491.1
1,464.4
***
Title VI — FDA & Related Agencies
Food and Drug Administration
**
Regular Appropriation
1,218.0
1,377.4
1,384.7
1,403.8
Supplemental Appropriation
151.1
0
0
0
Commodity Futures Trading
***
Commission (CFTC)
Regular Appropriation
70.7
46.9
80.0
94.4
Supplemental Appropriation
16.9
0
0
0
Total, FDA & CFTC
***
Regular Appropriations
1,288.7
1,424.3
1,464.6
1,498.2
Supplemental Appropriations
168.0
0
0
0
Other Provisions (6)
107.9
0
118.2
56.5
***
Total, Including Emergency
73,513.4 73,530.5 74,263.1 74,330.2
***
Spending, before adjustments
CBO Scorekeeping Adjustments (7)
108.4
531.8
42.8
330.8
***
Grand Total, Including
***
Scorekeeping Adjustments,
72,928.8 74,064.4 74,305.9 74,661.0
Excluding Emergency Spending
Grand Total, Including CBO
***
Scorekeeping Adjustments and
73,621.8 74,064.4 74,305.9 74,661.0
Emergency Spending
NA = Not yet available from the House Appropriations Committee
An item with a single asterisk (*) represents the total amount of direct and guaranteed loans that can
be made given the requested or appropriated loan subsidy level. Only the subsidy level is included
in the totals.
CRS-37
*** = Action Pending
(1) FY2002 enacted levels include amounts appropriated in the regular FY2002 agriculture
appropriations act for USDA and related agencies (P.L. 107-76), the $535 million in emergency
supplemental funding in P.L. 107-117, and the $158 million in net non-contingent appropriations
(after $44 million in rescissions) made in P.L. 107-206.
(2) Agency totals do not include the cost of the Administration’s legislative proposal to require all
federal agencies to pay the full share of accruing employee pensions and annuitant health benefits
beginning in FY2003. However, the CBO-estimated cost of this proposal ($368 million in FY2003
for USDA, FDA, and CFTC) is included at the end of the table in the scorekeeping adjustments of the
FY2003 request.
(3) The Administration’s request assumes enactment of new inspection and licensing user fees totaling
$29 million.
(4) Under current law, the Commodity Credit Corporation and the Federal Crop Insurance Fund each
receive annually an indefinite appropriation (“such sums, as may be necessary”). The amounts shown
for both FY2002 and FY2003 are USDA estimates of the necessary appropriations.
(5) Includes an adopted $3.3 million rescission in the FY2002 enacted level.
(6) Among other FY2002 provisions, includes $75 million in apple market loss assistance, and an
extension of the authority for the dairy price support program for 5 months (scored by CBO at $15
million).
(7) Scorekeeping adjustments reflect the savings or cost of provisions that affect mandatory programs,
plus the permanent annual appropriation made to USDA’s Section 32 program. The cost of the
Administration proposal to require all federal agencies to pay the full share of current employee
pensions and annuitant health costs is also included in the scorekeeping adjustments of the FY2003
Administration request.
Source: Based on spreadsheets provided by the House Appropriations Committee
For Additional Reading
CRS Issue Brief IB98006. Agricultural Export and Food Aid Programs.
CRS Report 97-325. Agricultural Research, Education, Extension and Economics
Programs: A Primer.
CRS Issue Brief IB10077. Agricultural Trade Issues in the 107th Congress.
CRS Report 98-25. Child Nutrition Programs: Background and Funding.
CRS Report RL31095. Emergency Spending for Agriculture: A Brief History of
Congressional Action, FY1989-2001.
CRS Report RL30739. Federal Crop Insurance and the Agriculture Risk Protection
Act of 2000 (P.L. 106-224).
CRS Issue Brief IB10099. Food Safety and Protection Issues in the 107th Congress.
CRS Report 98-59. Food Stamps: Background and Funding.
CRS-38
CRS Report RL31466, Homeland Security Department: U.S. Department of
Agriculture Issues
Rural Development. CRS Electronic Briefing Book page.
CRS Issue Brief IB96030. Soil and Water Conservation Issues.
What is the Cost of the 2002 Farm Bill? CRS Electronic Briefing Book page.