Farm Bill Programs Without a Budget Baseline Beyond FY2018
Released: 2018-05-02T00:00:00

Summary:
The 2014 farm bill (the Agricultural Act of 2014, P.L. 113-79) provided mandatory funding for many programs. Some of these programs have a budget baseline beyond the end of the farm bill in FY2018, while others do not. The Congressional Budget Office (CBO) baseline is a projection at a particular point in time of what future federal spending on mandatory programs would be under current law. This baseline is the benchmark against which proposed changes in law are measured. This report identifies mandatory programs in the 2014 farm bill that lack a budget baseline and explains the significance of this for enacting a successor to the current farm bill.
Generally, a program with estimated mandatory spending in the last year of its authorization will be assumed to continue in the baseline as if there were no change in policy and it did not expire. However, some programs may not be assumed to continue in the budget baseline, because the program had estimated mandatory spending less than a minimum $50 million scoring threshold in the last year of the farm bill, or the Budget Committees and/or Agriculture Committees determined that mandatory spending shall not extend beyond expiration.
Having a baseline essentially gives programs built-in future funding if policymakers decide that the programs should continue. Programs without a continuing baseline beyond the end of farm bill do not have assured future funding. As such, any extended authorization of these latter programs would be scored as new mandatory spending.
The 2014 farm bill contains 39 programs that received mandatory funding that do not have baseline beyond FY2018. These programs had estimated mandatory spending totaling $2.824 billion over the five-year farm bill. While this total may be a relatively small fraction of total farm bill spending (0.6% of the $489 billion five-year total projection), the effect may be particularly important to specific farm bill titles and to the programs' beneficiaries.
Notable programs among this group include certain conservation programs; most of the bioenergy, rural development, and research title programs; various nutrition title pilot programs and studies; organic agriculture and farmers' market programs; trade promotion programs; and outreach to socially disadvantaged and military veteran farmers. If policymakers want to continue these programs in the next farm bill, they may need to find budgetary offsets to pay for the costs.

paragraphs: T he 2014 farm bill (the Agricultural Act of 2014, P.L. 113-79 ) authorized $489 billion of mandatory spending over FY2014-FY2018. It generally expires at the end of FY2018. From a budgetary perspective, many of these programs are assumed to continue beyond their authorization; in fact, such continuing programs were estimated in 2014 to cost $468 billion for the extended FY2019-FY2023 period. That is, they have a "baseline" beyond the end of the farm bill that may be used to pay to continue those programs. However, a subset of programs that received mandatory funding does not have a baseline beyond the end of the farm bill. These are referred to as "farm bill programs without a baseline."
The 2014 farm bill contains 39 programs that received mandatory funding that do not have a baseline beyond FY2018. These programs received $2.8 billion during FY2014-FY2018. For these programs to continue, they would need to be allocated new budgetary authority.
subsections: section_title: The Importance of Baseline to the Farm Bill
paragraphs: Funding for farm bill programs is provided in two ways: 
1. By the authorization in the farm bill ( ma ndatory spending ). A bill pays for this spending with multiyear budget estimates when the law is enacted. 2. By subsequent appropriations ( d iscretionary spending ). These programs are authorized for their scope but are not funded in the farm bill.
Mandatory programs often dominate farm bill policy and the debate over the farm bill budget.
The Congressional Budget Office (CBO) baseline is a projection at a particular point in time of what future federal spending on mandatory programs would be under current law. This baseline is the benchmark against which proposed changes in law are measured. When a new bill is proposed that would affect mandatory spending, the impact ( score ) is measured in relation to the baseline. Changes that increase spending relative to the baseline have a positive score; those that decrease spending relative to the baseline have a negative score.
Having a baseline essentially gives programs built-in future funding if policymakers decide that the programs should continue; straightforward reauthorization would not have a scoring effect. However, programs without a continuing baseline beyond the end of a farm bill do not have assured future funding; reauthorization would have a positive score that increases the bill's cost.
This funding issue—and the difficult budget dynamics that it can cause for writing a new farm bill—was identified at least as early as 2009 by the former chief economist of the House Agriculture Committee. It was raised in Agriculture Committee hearings as early as 2010, was an issue when writing the 2014 farm bill, and continues to be mentioned.
section_title: Why Some Programs Do Not Have a Baseline
paragraphs: CBO develops the budget baseline under various laws and following the supervision of the House and Senate Budget Committees. Generally, a program with estimated mandatory spending in the last year of its authorization will be assumed to continue in the baseline as if there were no change in policy and it did not expire. This is the situation for most of the major, long-standing farm bill provisions such as the farm commodity programs or supplemental nutrition assistance. 
However, some programs may not be assumed to continue in the budget baseline beyond the end of a farm bill because they are either
programs with estimated mandatory spending less than a minimum $50 million scoring threshold in the last year of the farm bill, or new programs established after 1997 for which the Budget Committees determined that the mandatory spending shall not extend beyond expiration. This decision may be made in consultation with the Agriculture Committees, perhaps either to reduce the program's 10-year cost when the farm bill was written or to prevent it from having a continuing baseline.
section_title: Farm Bill Programs Without a Baseline After FY2018
paragraphs: CBO projects future government spending via its budget baselines and evaluates proposed bills via scoring estimates. But it has not specifically published a list of expiring farm bill programs without a continuing baseline. To compile this list, CRS analyzed the CBO score of the 2014 farm bill in conjunction with the statutory text of the law and current CBO baseline projections that were made under the rules listed above. Our criteria are that programs have estimated mandatory funding in the 2014 farm bill (as indicated by the 2014 CBO score and in the text of the law) but do not have a baseline beyond FY2018 (indicated either in the 2014 CBO score or in the current CBO baseline). 
Based on this analysis, 39 programs across 10 of the 12 titles of the farm bill do not have a continuing baseline after FY2018. These programs had estimated mandatory spending totaling $2.824 billion over the five-year window of the farm bill ( Table 1 ). Any extended authorization of these programs would be scored as new mandatory spending, which may require either offsets from existing baseline for other programs or an increase in net spending.
As a share of the $489 billion five-year mandatory cost of the farm bill in 2014, programs without a baseline beyond FY2018 are relatively small: 0.6% of the total projected farm bill spending, or 2.5% of the total excluding the nutrition programs ( Table 1 ). However, the impact of programs without a baseline varies by title of the farm bill. For the rural development title, 100% of the mandatory spending in the 2014 farm bill was by programs that do not have baseline beyond FY2018. For the bioenergy and research titles, the share was at least one-half. At the other extreme, nutrition programs and the farm safety net—including crop insurance and the commodity programs—have less than 1% in programs without a continuing baseline.
The 2014 farm bill has less exposure to programs without baseline than did the 2008 farm bill, which had 37 programs without baseline totaling an estimated $9 billion to $14 billion. The 2014 farm bill provided 29 of those 37 programs with $6.2 billion of mandatory funding over FY2014-FY2018. Some of those programs reappear on the current list of 2014 farm bill programs without baseline, while others either received a continuing baseline or were not reauthorized.
 Figure 1 and Table 2 present the 39 individual programs in the 2014 farm bill that do not have a budget baseline beyond FY2018. Figure 1 is grouped and sorted by title of the farm bill based on the amount of mandatory spending by programs without a baseline within each title. Table 2 is organized by the section number in the 2014 farm bill and grouped by title.