Congressional Democrats are pushing for a historic increase in conservation program funding that would help pay farmers to address climate change, but the money also could create some challenges for the House and Senate Agriculture committees as they write the new farm bill.
Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., has said she wants to include $50 billion in new conservation spending over the next 10 years in the $3.5 trillion reconciliation package Democrats are planning to move in coming weeks to pay for a range of domestic spending priorities.
If Stabenow wins the full amount she wants, that $50 billion would theoretically double existing spending levels on farm bill conservation programs, which range from the land-idling Conservation Reserve Program to the Environmental Quality Incentives Program and Conservation Stewardship Program, which are designed for working lands.
However, because of arcane Senate budget rules, lawmakers might not be able to make use of the full $50 billion.
Here’s why: Under what’s known as the Senate’s Byrd rule, funding provided by a reconciliation bill is limited to a 10-year window that starts when the legislation takes effect. Funding provided through the Democrats’ reconciliation measure would presumably start in 2022, and then run out in 2031. That would create a potential funding cliff for future farm bills.
However, experts say the funding could be extended longer by stretching it out over the next farm bill’s 10-year budget window. If the next farm bill is enacted in 2024, that means the Agriculture committees could make the conservation funding extend through 2033, said Bart Fischer, a former chief economist for the House Agriculture Committee who is now co-director of the Agricultural and Food Policy Center at Texas A&M University.
But it’s not as simple as stretching the $50 billion over those 10 years. Because a new farm bill wouldn't take effect until at least 2024, two years after the 10-year reconciliation period starts, two years of the reconciliation bill’s funding allocation - a total of $10 billion - could be lost. That means only $40 billion, an average of $4 billion a year, would actually be available for the Agriculture committees to use in the new farm bill, Fischer says.
But in Fischer’s view, there would be a major benefit to extending the funding over the farm bill's full, 10-year budgeting window. Because of congressional budget rules that apply to farm bills, the higher funding levels for conservation programs would automatically become a permanent part of the farm bill baseline.
While the Senate’s Byrd rule limits reconciliation bills to a 10-year period, “in a farm bill there’s no such restriction,” Fischer told Agri-Pulse.
Bill Hoagland, a federal budget specialist with the Bipartisan Policy Center, agreed that the Ag committees could use the reconciliation funding to create permanent baseline for farm bills if the panels extend the spending over 10 years.
More than 200 conservation and farm groups are sending a letter Wednesday to Democratic congressional leaders appealing for an increase in conservation funding.
"Increasing baseline funding for the Farm Bill conservation programs and ramping up conservation technical assistance on the ground will enable landowners to mitigate the impacts of drought and flood, improve habitat, improve soil health and long-term food security, create new job opportunities for rural economies, and galvanize the agriculture sector to lead the charge in our fight against climate change," the letter says.
The shape of the reconciliation package, including its broad funding priorities, will become clearer when Democrats release a Senate budget resolution that will have instructions and spending amounts for the Agriculture committees and other panels. The resolution must be passed before the chambers can create the reconciliation bill with its various spending and tax provisions.
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Senate Majority Leader Charles Schumer, D-N.Y., has repeatedly said he will bring up the resolution after the Senate finishes debate on the bipartisan infrastructure bill that is now on the floor.
But prospects for the reconciliation package are still cloudy. Senate Democrats can’t afford to lose a single member of their caucus, and neither Kyrsten Sinema of Arizona nor Joe Manchin of West Virginia have committed to vote for it. Sinema says $3.5 trillion is too much, and Manchin has expressed concern about the overall impact on the economy and the effect of clean energy provisions on fossil fuels.
The former chairman of the House Agriculture Committee, Rep. Collin Peterson, D-Minn., is doubtful the package can even pass the House, where Democrats hold a slim 220-212 majority.
He said there are 10 to 15 Democrats who would likely oppose the bill both because of the level of proposed spending as well as a Democratic proposal to start taxing capital gains at death, which would effectively nullify the benefit of stepped-up basis.
“I don't think they can even pass reconciliation out of the House, and it’s got to start in the House. It can’t start in the Senate,” he said. “The biggest problem is not just the tax issue, I think the amount of spending is a problem for people.”
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