WASHINGTON, Feb. 2, 2015 – President Obama is calling for the first time to create a single food-safety agency while also proposing to cut some conservation spending and reviving a failed attempt to slash crop insurance premium subsidies.

Creating the food safety agency, proposed in the fiscal 2016 budget Obama released today, would move the meat inspection program from the Agriculture Department to the Department of Health and Human Services, where that oversight for meat would be combined with the food-safety responsibilities of the Food and Drug Administration, which is responsible for most of the food supply.

“The bottom line is that we want to make sure we have as effective and efficient a system as possible,” said Agriculture Secretary Tom Vilsack.

The proposal could give a little momentum to perennial efforts among congressional Democrats to reorganize food safety regulation, but the idea is unlikely to get much if any traction in a Congress now controlled by Republicans. Some consumer advocates also raised concerns about the proposal. 

A new agency at HHS "would be lost among the other priorities of the department, and would likely not receive the recognition or resources necessary for it to be effective," said Chris Waldrop of the Consumer Federation of America. Tony Corbo, a senior lobbyist for Food and Water Watch, said that USDA's and FDA's programs would be complicated to merge, in part because they have different legal authority. 

While defending the current safety of food, Vilsack said that combining agencies “reduces the opportunity for the right hand not knowing what the left hand knows about a particular situation.”

The proposed cuts to crop insurance have become a regular feature of Obama’s budget but the recommendations this year are more narrowly focused. This year the administration says its plan would save taxpayers nearly $16 billion over 10 years, including $1.1 billion in fiscal 2016.

The reduction in premium subsidies would be targeted at subsidies for farmers who select harvest-price coverage in their revenue policies and also for prevented planting benefits. Premium subsidies for harvest-price policies would be reduced by 10 percentage points. Previous budgets had also targeted insurance company returns as well.

Vilsack said the cuts would help offset the higher costs of the new commodity programs created by the 2014 farm bill due to declining crop prices. “One of the challenges of passing the farm bill was to create sufficient savings to satisfy everyone that over time that we would spend less money,” he said.

Mary Kay Thatcher, a lobbyist for the American Farm Bureau Federation, said the proposed cut to revenue policies was “more of the same."

"This is the third year in a row USDA has proposed to cut premium subsidies for revenue policies with the harvest price option," Thatcher said. "Each year they increase the suggested amount for premium reductions.  Since Congress didn’t accept the administration’s suggestions for lower cuts the last two years, a larger proposed cut this year has to be dead on arrival.”


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The cut to prevented-planting coverage would save about $1.4 billion over 10 years, in part by lowering payment rates. The plan also would eliminate prevented-planting optional coverage and require the use of a 60-percent “transitional yield” in calculating  the farmer’s actual production history (APH) for years in which the grower receives a prevented-planting payment.

One idea that could get support from GOP appropriators is a proposed cut to the Conservation Stewardship Program. Vilsack noted that USDA is putting more emphasis on conservation measures that enlist funding and technical support from outside groups and business interests. CSP provides payments to farmers who agree to follow certain conservation practices.


The CSP cut would reduce enrollment from 10 million acres to 7 million acres in 2016 and save $54 million a year.


Evidently the White House has found something in common with the 2014 decisions of the House majority appropriators, namely slashing farm bill conservation mandatory spending from a farm bill three painstaking years in the making that the president signed into law just a year ago,” said Ferd Hoefner, policy director for the National Sustainable Agriculture Coalition.


The budget also includes a variety of user fees, including for food safety, that have been routinely rejected by congressional appropriators.


Other proposals:

--Some $20 million in food-aid funding could be used to buy commodities in or near the countries where the food is to be distributed. The farm bill authorizing up to $80 million a year in local and regional procurement (LRP) of Food for Peace commodities.
--The budget proposes to increase the FDA’s food safety budget by $301 million to $1.6 billion to carry out new regulations required under the Food Safety Modernization Act. GOP appropriators also resisted previous large increases in FDA’s budget.

--Obama also is proposing some increases for the Supplemental Nutrition Assistance Program, formerly known as food stamps. Some $488 million over 10 years is earmarked for states to increase elderly participation in the program, while another $213 million would help SNAP recipients with employment and training.

The president’s $4 trillion budget would increase USDA’s discretionary spending programs, which include food safety, research, firefighting and some nutrition spending, by $800 million, to $25 billion in fiscal 2016. Spending on mandatory programs, which include farm programs, SNAP and school meal funding, is expected to rise from $128 billion to $131 billion in fiscal 2016.

USDA's fiscal 2016 budget proposal is here.