FY2019 Supplemental Appropriations for Agriculture

FY2019 Supplemental Appropriations for Agriculture

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June 7, 2019
FY2019 Supplemental Appropriations for Agriculture
On June 3, 2019, Congress passed H.R. 2157 (FY2019
Funding for Agricultural Losses
supplemental), which authorized supplemental
Title I of the FY2019 supplemental provides over $3.0
appropriations for new and existing agricultural programs at
billion to the Secretary of Agriculture to cover crop, tree,
the U.S. Department of Agriculture (USDA), among other
bush, and vine losses from 2018 and 2019 natural disasters
assistance. The Congressional Budget Office (CBO)
that were not covered under the Federal Crop Insurance
estimates that the FY2019 supplemental totals more than
Program (crop insurance) or the Noninsured Crop Disaster
$19.1 billion in new budget authority over 10 years. The
Assistance Program (NAP).
agriculture title (Title I), including nutrition assistance, is
estimated to total $5.37 billion over the same period, or
The Bipartisan Budget Act of 2018 (P.L. 115-123, BBA18)
roughly 28% of the total act (see Table 1). All of the
authorized supplemental assistance of $2.36 billion along
agriculture portion is designated as emergency spending. In
similar lines. USDA implemented the BBA18 funding
addition to new budget authority, CBO estimates that the
through a program referred to as the Wildfire and Hurricane
act results in additional outlays for existing programs.
Indemnity Program of 2017 (WHIP 2017). While language
in the FY2019 supplemental is similar to the WHIP 2017,
Table 1. FY2019 Supplemental Appropriation, Title I
some notable differences exist (see Table 2).
Dollars in millions, FY2019-FY2029
The FY2019 supplemental program limits payments to up
Agency/Program
10-Year Total
to 90% of losses, including payments from crop insurance
and NAP. For producers who did not purchase crop
Agriculture programs

insurance or NAP in advance of the natural disasters,
Agriculture production losses
3,005
payments are limited to 70% of losses. These coverage
levels are higher than BBA18. All participants are required
Require purchase of crop insurance
65
to purchase crop insurance or NAP for the next two crop
Amend AGI for MFP (§103)
15
years.
Crop Insurance for hemp (§107)
10
The FY2019 supplemental also amends existing disaster
Cost share and grant assistance

assistance program requirements. Under the Tree
Assistance Program (TAP), payments are made to
Emergency Forest Restoration Program
480
orchardists and nursery growers with tree, bush, or vine
Emergency Conservation Program
558
losses is in excess of 15% after adjustment for normal
mortality. The supplemental extends TAP payments to
Emergency Watershed Protection
435
pecan tree losses in excess of 7.5% (adjusted for normal
mortality) during calendar year (CY) 2018. For more
Rural Community Facilities Program
150
information on agricultural disaster assistance programs,
Food and Nutrition Service

see CRS Report RS21212, Agricultural Disaster
Assistance.
SNAP: Puerto Rico grant (§104)
600
SNAP: Grants to Commonwealth of the
Covering the losses of farmers who chose not to purchase
Northern Mariana Island and American
insurance, as well as those who did, has the potential to
Samoa; Puerto Rico study (§§101,105, 106)
48
create a moral hazard for future participation. Supplemental
appropriations have now provided additional loss payments
Total Budget Authority
5,366
for three crop years, which may raise questions about the
Estimated Outlays in Addition to New Budget Authority
effectiveness of existing agricultural disaster assistance
programs, which are permanently authorized to receive
Peaches and blueberries (§102)
75
such sums as necessary from mandatory funding sources.
Adulterated grapes
75
Some provisions of the FY2019 supplemental could also
Rural definition for California (§108)
98
increase the total amount of payments received under
Source: CBO score of Senate Amendment to H.R. 2157, May 23,
existing programs for producers that meet its payment
criteria. For example, under crop insurance, prevented
2019.
planting payment rates are approximately 55% for corn and
Notes: SNAP = Supplemental Nutrition Assistance Program. AGI =
60% for soybeans. The supplemental could increase the
adjusted gross income.
prevented planting rate to up to 90% of loss for all crops.
This could potentially affect planting decisions in 2019.
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link to page 1 FY2019 Supplemental Appropriations for Agriculture
The FY2019 supplemental also includes provisions that
WHIP 2017
may allow for duplicate payments under other existing
The WHIP 2017 was authorized in the BBA18 to make
disaster programs. For example, up to $7 million of the
payments for agricultural losses in CY2017 related to
amount for agricultural losses is allowed for payments to
Hurricanes Irma and Maria, and wildfires. The FY2019
producers whose indemnity payment was reduced because
supplemental (§102) expands the losses that may be
of a state-legislated disaster program payment for a 2018
covered under this program to include losses from Tropical
crop loss. This applies to crop insurance whole-farm
Storm Cindy, peach and blueberry losses from extreme cold
revenue protection policies.
in CY2017, and blueberry productivity losses from extreme
cold and hurricanes in CY2018. CBO estimates that this
Table 2. Select Differences Between BBA18 and the
provision could result in $75 million in additional outlays in
FY2019 Supplemental for Agricultural Losses
FY2019, from authority already provided in the BBA18.

BBA18
FY2019 Supplemental
Market Facilitation Program (MFP)
Funding $2.36 billion
$3.01 billion
On July 24, 2018, USDA announced assistance in response
to trade damages from retaliatory tariffs targeting various
Losses
Crop, tree, bush,
Crop (including milk, on-farm
agricultural commodities. The MFP provides direct
and vines
stored commodities, crops
financial assistance to producers of commodities that were
prevented from being planted in
impacted by the loss of traditional exports. To qualify,
2019, and harvested adulterated
USDA required MFP recipients to pass a means test—an
wine grapes), tree, bush, vines,
average adjusted gross income (AGI) for tax years 2014,
forest restoration, and poultry and 2015, and 2016 of less than $900,000. The supplemental
livestock.
(§103) would amend this requirement to (1) change the tax
Events
Hurricane Irma,
Hurricane Michael, Hurricane
years used to calculated AGI to 2013, 2014, and 2015, and
Hurricane Maria,
Florence, and other hurricanes,
(2) allow MFP payments for those with AGI more than
and other
floods, tornadoes, typhoons,
$900,000 if at least 75% of their AGI came from farming,
hurricanes, and
volcanic activity, snowstorms, and ranching, or forestry related activities. This could create
wildfires
wildfires
confusion as previous MFP payments were made based on
a different AGI tax period. Also unclear is whether using
Timing
Calendar year 2017
Calendar years 2018 and 2019
different tax years could make previously obligated MFP
payments ineligible, requiring repayment. For additional
Limit
85% of losses
90% of losses (insured), 70% of
information about MFP, see CRS Report R45310, Farm
(insured), 65% of
losses (uninsured)
Policy: USDA’s 2018 Trade Aid Package. For more on
losses (uninsured)
payment limits, see CRS Report R44739, U.S. Farm
Source: CRS, compiled from P.L. 115-123 and H.R. 2157.
Program Eligibility and Payment Limits.
Cost-Share and Grant Assistance
Crop Insurance for Hemp
The 2019 supplemental also provides funding for existing
The Agricultural Improvement Act of 2018 (P.L. 115-334)
assistance programs that typically require supplemental
makes hemp an eligible crop under the federal crop
appropriations to operate. Three programs—Emergency
insurance program. The supplemental (§107) further
Forest Restoration Program (EFRP), Emergency
requires that whole-farm revenue protection under crop
Conservation Program (ECP), and Emergency Watershed
insurance be available for hemp no later than the 2020
Protection (EWP) program—help repair and rehabilitate
reinsurance year.
damaged land following a natural disaster. All three are
funded in the supplemental (see Table 1) for expenses
Assistance in Rural Communities
related to Hurricanes Michael and Florence and wildfires in
In addition to funding in the FY2019 supplemental for the
CY2018, and tornadoes and floods in CY2019. Funding
Rural Community Facilities Program, USDA also provides
levels for ECP and EWP are consistent with previously
assistance to rural areas through a number of annually
appropriated amounts. Due to increased forestry damage,
funded programs. Assistance provided to rural communities
funding for EFRP ($480 million) is significantly higher in
varies based on the statutory definition of “rural.” The
the FY2019 supplemental than previous years, which has
supplemental (§108) allows California’s governor to certify
averaged $9.2 million annually since the program’s creation
an area’s population as a rural area if impacted by
in FY2010. For additional information on EFRP, ECP, and
November 2018 wildfires in California’s Butte, Ventura,
EWP, see CRS Report R42854, Emergency Assistance for
and Los Angeles counties. This potentially allows these
Agricultural Land Rehabilitation.
communities to access loans, grants, and technical
assistance under USDA’s Rural Development programs.
The FY2019 supplemental also funds the Rural Community
CBO estimates that this provision could cost $98 million in
Facilities Program account. The program provides loans
additional outlays over 10 years. For additional information
and grants to support essential community facilities in rural
on these programs, see CRS Report RL31837, An Overview
areas with populations of 20,000 or fewer. The
of USDA Rural Development Programs.
supplemental provides $150 million for grants related to
Hurricanes Michael and Florence and wildfires in CY2018,
Megan Stubbs, Specialist in Agricultural Conservation and
and tornadoes and floods in CY2019.
Natural Resources Policy
Jim Monke, Specialist in Agricultural Policy
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FY2019 Supplemental Appropriations for Agriculture

IF11245

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