House Republicans took a major step toward enacting President Donald Trump's policy agenda and boosting spending for commodity programs and crop insurance by winning passage Thursday morning of the GOP's sweeping budget reconciliation bill.
The One Big Beautiful Bill Act, which passed the House on a party-line vote, 215-214, includes funding for key parts of the farm bill paid for by a $285.7 billion reduction in projected spending for the Supplemental Nutrition Assistance Program. The bill also extends and expands key tax benefits widely used by farmers and small businesses.
The legislation now heads to the Senate where it could be significantly modified. Senate GOP leaders haven't said whether the House-passed legislation will be routed through committees or modified and put directly on the Senate floor. In any case, the reconciliation process allows the bill to pass the Senate with a simple majority, bypassing the threat of a Democratic filibuster. But any Senate changes to the bill would send the modified version back to the House.
House Speaker Mike Johnson, D-La., rounded up the final votes he needed from Northeast moderates and hardline conservatives by agreeing to increase the deduction for state and local income taxes while also accelerating the phase out of some Inflation Reduction Act tax credits for renewable energy.
“This bill gets Americans back to winning again, and it's been a long time coming. This one big, beautiful bill is the most consequential legislation that any party has ever passed,” Johnson said before the final votes.
He said passage of the bill leaves congressional Republicans on track to get the legislation to Trump's desk by July 4.
The package includes major wins for farmers, including the tax benefits and the $56.4 billion increase for farm bill programs like higher reference prices in the Price Loss Coverage program and increased premium subsidies for the supplemental coverage option in crop insurance. The bill also would bring IRA conservation funding into the farm bill baseline while removing restrictions that limit the dollars to climate-smart practices.
The bill would increase the Section 199A deduction for business income from 20% to 23% and boost business expensing provisions. The Section 179 allowance would allow businesses to write off up to $2.5 million of the cost of equipment and software, with the limit phased down as spending exceeds $4 million. The bill also would would increase the estate tax exemption to $15 million per person, $30 million for a married couple, and index it to inflation.
However, the bill's tax benefits and farm bill spending come with historic cuts to SNAP. Anti-hunger groups argue portions of the bill could cut millions of eligible individuals from the program, and ultimately increase hunger.
Some of the policies adopted in the final bill include setting stricter work requirements for able-bodied adults without dependents, saving taxpayers $92.5 billion over 10 years, according to the Congressional Budget Office. Under the bill, the age range for work requirements would extend from 54 to 64 and change the definition of dependent child from under 18 to under 7.
Republicans also included a controversial proposal to shift more costs of the program benefits and administration to the states. Currently, the federal government covers 100% of the program benefit costs, while splitting administrative costs 50-50 with states.
Under the bill, states would be required to cover 75% of the administrative costs. Additionally, they would cover some of the benefit costs with the share determined by SNAP error rates.Democrats and state leaders have already sounded the alarm that not all states will be able to absorb these costs, and could ultimately shrink their program as a result.
House Democrats argued that the bill was fiscally irresponsible because of its projected increase in budget deficits and would harm low-income people through cuts to Medicare and SNAP.
"It's one big, ugly bill. It's a GOP tax scam, it's a reckless Republican budget. It's an assault on the economy. It's an assault on health care. It's an assault on nutritional benefits," said House Minority Leader Hakeem Jeffries, D-N.Y.
IRA credits were a key sticking point for some Freedom Caucus members. Specifically, they wanted credits for electric vehicles and clean energy production to end more quickly than the gradual phase-out included in the initial bill.
However, the 45Z credit for clean fuel producers would not only be preserved but also extended in the bill. Biofuel producers and farm groups have argued that the credit needed to be longer to give the market and industry more certainty. The bill also includes restrictions on where feedstocks can be sourced from, and makes other adjustments to the credit as sought by biofuel groups.
The bill still faces major hurdles in the Senate, where some members of the Agriculture Committee appear weary of including the SNAP state cost-share proposal. The Senate’s bill must also adhere to the Byrd rule, which could restrict how it handles farm bill provisions.
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