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October 17, 2022
Farm Bill Primer: Budget Dynamics
Congress may consider a new farm bill in 2023 because
by $73 billion over 10 years under a budget resolution
provisions authorized in the 2018 farm bill (P.L. 115-334)
during a budget surplus. The 2008 farm bill was budget
begin expiring at the end of FY2023. From a budgetary
neutral, although it added $9 billion to outlays over 10
perspective, many farm bill programs are assumed to
years by using offsets from a tax-related title. The 2014
continue. Supplemental funding in recent years may
farm bill had a negative score, reducing spending by $16
influence policy expectations for a new farm bill.
billion over 10 years. The 2018 farm bill was budget neutral
and offset reductions in some titles with increases in others.
Farm Bills from a Budget Perspective
Federal spending for agriculture is divided into two main
CBO’s May 2022 Baseline
categories—mandatory and discretionary spending:
As of this writing, the official baseline to write a farm bill
in 2023 does not exist. CBO is expected to release an
Mandatory spending is authorized primarily for the
official scoring baseline for the 2023 legislative session in
farm commodity programs, conservation, crop
the spring of 2023, which would cover the 10-year period
insurance, and the nutrition assistance programs. A farm
FY2024-FY2033. Currently, the May 2022 CBO baseline is
bill authorizes outlays for mandatory programs when the
the best indicator of future funding availability.
law is enacted and follows budget enforcement rules.
Farm bills have 5-year and 10-year budget projections
Discretionary appropriations are authorized, but not
according to federal budgeting practices. Using the May
provided, for most other programs, including rural
2022 data and funding indicated in law for other farm bill
development, research, and credit programs. A farm bill
programs, the baseline for farm bill programs is estimated
sets program parameters. Funding may be provided in
at $648 billion over 5 years (FY2023-FY2027) and $1,295
subsequent appropriations acts that follow separate
billion over 10 years (FY2023-FY2032, Figure 1).
budget enforcement rules.
Figure 1. Farm Bill Titles with Mandatory Baseline
Some farm bill programs have received both types of
10-year projected outlays, FY2023-FY2032, bil ions of dol ars
funding. Discretionary appropriations are the primary
source for many programs, but mandatory spending usually
dominates the farm bill budget debate and is the focus here.
Importance of Baseline to the Farm Bill
The Congressional Budget Office (CBO) baseline is a
projection at a particular point in time of what future federal
mandatory spending would be under the assumption that
current law continues. The baseline is the benchmark
against which proposed changes in law are measured.
When a bill is proposed that would affect mandatory
spending, the score (cost impact) is measured in relation to
the baseline. Changes that increase spending relative to the
baseline have a positive score; those that decrease spending
relative to the baseline have a negative score.
Increases in a bill’s total cost beyond the baseline may be
Source: CRS, using CBO May 2022 Baseline and amounts indicated
subject to budget constraints, such as pay-as-you-go
in law for programs in other titles.
(PayGo) rules. Reductions from the baseline may be used to
The relative proportions of farm bill spending have shifted
offset costs for other provisions that have a positive score or
over time. In the 2022 projection, the Nutrition title is 84%
used to reduce the federal deficit. The annual budget
of the farm bill baseline, compared with about 76% when
resolution determines whether a farm bill is held budget
the 2018 farm bill was enacted. Increases in the Nutrition
neutral or can increase or must decrease spending.
title since 2018 reflect consequences of the Coronavirus
Recent Farm Bills’ Budget Positions
Disease 2019 (COVID-19) pandemic, inflation, and
administrative adjustments pursuant to the 2018 farm bill.
Over the past two decades, farm bills have had both
For the non-nutrition agriculture programs in the farm bill,
positive and negative scores relative to their baselines. The
current economic projections are that program outlays
2002 farm bill had a positive score and increased spending
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Farm Bill Primer: Budget Dynamics
would be $205 billion over the next 10 years (Figure 2),
3% lower than at enactment in 2018.
Figure 2. Baseline for Agriculture Programs in the Farm Bill
10-year projected outlays (excluding the Nutrition title), FY2023-FY2032, millions of dol ars
Source: Created by CRS using CBO May 2022 baseline and amounts indicated in law for programs in other titles.
Effect of Supplemental Payments
Without Baseline Beyond FY2023). As Congress balances
budget considerations, providing mandatory funding for
Supplemental spending is not part of the baseline but may
programs without baseline would require budgetary offsets.
be discussed because of its size in recent years. In FY2019
and FY2020, the Trump Administration increased outlays
Figure 3. Agriculture Titles That Receive Mandatory
by over $25 billion to producers affected by retaliatory
Funding in the Farm Bill and Funding These Titles
tariffs. Since FY2020, Congress and the White House have
Receive in the Inflation Reduction Act
provided supplemental pandemic assistance of over $30
billion to farms and over $60 billion for nutrition assistance.
In addition, P.L. 117-169 (often referred to as the Inflation
Reduction Act of 2022, or IRA) added over $17 billion in
outlays for four programs in the farm bill’s Conservation
title and one program in the Energy title. The IRA funding
is not regular farm bill funding. It is not permanent; the new
budget authority is provided until FY2026, and the law
states that outlays may not occur after FY2031 (Figure 3).
Since 2018, Congress has authorized more than $15 billion
of ad hoc disaster assistance for agricultural losses (CRS In
Focus IF12101, Farm Bill Primer: Disaster Assistance).
Congress may address the effectiveness of farm bill
programs in light of this additional funding.
Programs Without Baseline
The 2018 farm bill added several new programs in Figure 2
that received a permanent budget baseline. However, 19
other programs received mandatory funding in the 2018
Source: CRS, using the May 2022 CBO baseline and CBO score of
farm bill but do not have a baseline beyond their expiration
the Inflation Reduction Act (IRA; P.L. 117-169).
(CRS In Focus IF12115, Farm Bill Primer: Programs
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Farm Bill Primer: Budget Dynamics
Notes: Excludes programs in the IRA that are not regularly provided
Jim Monke, Specialist in Agricultural Policy
mandatory funding in the farm bil . Includes estimated effects of
budget sequestration.
IF12233
Disclaimer
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