{ "id": "IN10832", "type": "CRS Insight", "typeId": "INSIGHTS", "number": "IN10832", "active": false, "source": "EveryCRSReport.com", "versions": [ { "source": "EveryCRSReport.com", "id": 602269, "date": "2017-12-01", "retrieved": "2020-01-02T16:42:35.417384", "title": "Proposed Offsets Exceed Spending for Agriculture in the Administration\u2019s Disaster Assistance Request", "summary": "On November 17, 2017, the Office of Management and Budget (OMB) released the Administration\u2019s request for a third round of supplemental funding in response to natural disasters in 2017. The total request includes $44 billion of additional appropriations for disasters during 2017, offset by $59 billion of reductions to budget authority for previous appropriations ($15 billion) and a two-year extension of sequestration on mandatory spending ($44 billion) from FY2025 to FY2027. \nAccounts in the jurisdiction of Agriculture appropriations would receive an additional of $992 million for disaster recovery but be reduced over time by $5.6 billion. Proposed reductions include $3 billion through rescissions of prior appropriations and an estimated $2.6 billion share from extending sequestration on mandatory spending in the jurisdiction of Agriculture appropriations (Table 1). The result, therefore, would be a net $4.6 billion reduction from agriculture accounts.\nDisaster Assistance\nAccounts in the jurisdiction of Agriculture appropriations would receive $992 million in the Administration\u2019s supplemental request. This is the first time in 2017 that agriculture accounts would be included in supplemental appropriations. The assistance is primarily for two agricultural land rehabilitation programs\u2014the Emergency Watershed Protection Program ($500 million) and the Emergency Conservation Program ($375 million). \nOther agricultural disaster assistance programs would receive supplemental funding in lower amounts, including the Emergency Forest Restoration Program for private lands ($50 million) and the Emergency Assistance for Livestock, Honey Bees, and Farm-Raised Fish program ($40 million). The request would also target funding to repair U.S. Department of Agriculture research buildings damaged by recent hurricanes and provide additional authority for multifamily housing loan programs in rural areas.\nStakeholders have called for other types of agricultural assistance, but these programs were not included in the Administration\u2019s request. These include amounts for citrus and specialty crop production damaged by Hurricane Irma and livestock and cotton production damaged by Hurricane Harvey, particularly for losses not covered by existing agriculture disaster assistance programs.\nOffsets\nThe Administration proposes to offset the additional spending on supplemental appropriations with cancellations of unobligated balances from prior appropriations and by extending by two years to FY2027 the sequestration on mandatory spending as part of the Budget Control Act of 2011 (P.L. 112-25). Thus, for agriculture, offsets would exceed supplemental assistance. \nCancellations of unobligated balances from prior appropriations affecting agriculture total $3 billion, of which about $1.4 billion come from conservation programs. The offsets also include an $800 million rescission from the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) and a $196 million rescission from the rural development cushion of credit account, which contains advance payments by borrowers that earns interest to fund Rural Economic Development loans. The WIC and cushion of credit rescissions are also proposed in the FY2018 Agriculture appropriations bills (H.R. 3268, S. 1603). Using offsets in supplemental appropriations that are proposed for the FY2018 appropriation may make the latter more challenging, since those offsets would no longer be available. The proposed cancellation of $212 million from Agricultural Research Service (ARS) buildings and facilities was in the Administration\u2019s FY2018 budget request, but appropriators chose not to include it in their bills.\nBecause agriculture spending relies heavily on mandatory spending, and mandatory spending continues to have annual sequestration from the Budget Control Act, agriculture is particularly affected by extending sequestration as an offset to pay for current spending. To date, sequestration on mandatory spending has been extended by four years from its original FY2021 sunset. The Administration\u2019s current proposal to extend sequestration does not mention the effect on program areas. A CRS tabulation of sequestration in FY2018 on accounts in the jurisdiction of Agriculture appropriations is $1.3 billion. With this as an annual estimate of the agriculture share in sequestration, the proposal to extend sequestration by two more years could result in an estimated $2.6 billion of additional sequestration from mandatory agriculture accounts in FY2026 and FY2027, assuming program and funding continuity.\nAs noted, these offsets ($5.6 billion) from agriculture would exceed the addition ($992 million) to agricultural accounts for disaster assistance by more than $4.6 billion.\nTable 1. Effect on Agriculture from Administration\u2019s Request for Disaster Assistance\n(million dollars; accounts in the jurisdiction of Agriculture appropriations)\nProgram\nAmount \n\nDisaster Assistance\n\n\nWatershed and Flood Prevention Operations (hurricane debris removal and repairs)\n+500.0\n\nEmergency Conservation Program (hurricane damage repairs)\n+375.0\n\nEmergency Forest Restoration Program (hurricane damage restoration)\n+50.0\n\nEmergency Assistance for Livestock, Honey Bees, and Farm-Raised Fish program\n+40.0\n\nARS Buildings and Facilities (hurricane damage repairs)\n+21.7\n\nRural Housing Service Multifamily Housing (supports $20 million of direct loans)\n+4.3\n\nOffice of Inspector General (oversight)\n+1.0\n\nSubtotal\n+992.0\n\nOffsets\n\n\nExtend Joint Committee sequestration on mandatory programs two more years through FY2027\n-2,600.0a\n\nConservation programs (unobligated, $400 million pre-2014, $230 million CSP, $551 million RCPP)\n-1,419.0\n\nWIC (as proposed in Agriculture appropriations)\n-800.0\n\nARS Buildings and Facilities (delay modernization, as proposed in Administration\u2019s budget)\n-212.0\n\nEmergency Watershed Program (unobligated balances)\n-204.0\n\nRural Economic Development Grants (cushion of credit, as proposed in Agriculture appropriations)\n-196.0\n\nWatershed and Flood Prevention Operations (unobligated balances)\n-90.0\n\nAPHIS (unobligated balances from emergency preparedness and health programs)\n-72.0\n\nRural Business Program (unobligated balances in Business and Industry loans and other grants)\n-25.0\n\nRural Energy Savings Program (as proposed in Senate Agriculture appropriations)\n-8.0\n\nSubtotal\n-5,626.0\n\nAgriculture programs total\n-4,634.0\n\nSource: CRS, compiled from OMB, \u201cLetter regarding additional funding and reforms to address impacts of recent natural disaster,\u201d November 17, 2017.\nNotes: WIC = Special Supplemental Nutrition Program for Women, Infants, and Children; CSP = Conservation Stewardship Program; RCPP = Regional Conservation Partnership Program; APHIS = Animal and Plant Health Inspection Service.\nAccounts with mandatory spending in the jurisdiction of Agriculture appropriations bear $1.3 billion of sequestration in FY2018 (OMB, \u201cReport to the Congress on the Joint Committee Reductions for FY2018,\u201d May 23, 2017). We use this one-year amount to estimate the two-year Agriculture share of the $44.4 billion offset from extending sequestration, assuming program and funding continuity.", "type": "CRS Insight", "typeId": "INSIGHTS", "active": false, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "https://www.crs.gov/Reports/IN10832", "sha1": "f9deabd566f830d6bf9c82ee66b7279a25015256", "filename": "files/20171201_IN10832_f9deabd566f830d6bf9c82ee66b7279a25015256.html", "images": {} }, { "format": "PDF", "encoding": null, "url": "https://www.crs.gov/Reports/pdf/IN10832", "sha1": "628f62964a345ea020b3879c5f4290b2a70dba8a", "filename": "files/20171201_IN10832_628f62964a345ea020b3879c5f4290b2a70dba8a.pdf", "images": {} } ], "topics": [ { "source": "IBCList", "id": 4830, "name": "Agriculture Budget & Appropriations" }, { "source": "IBCList", "id": 4920, "name": "Agriculture Appropriations" } ] } ], "topics": [ "Appropriations", "CRS Insights" ] }