Expiration and Extension of the 2008 Farm Bill
Released: 2014-04-11T00:00:00

Background on Extension and Expiration

Congress periodically establishes agricultural and food policy in a multiyear omnibus farm bill. Provisions in the Food, Conservation, and Energy Act of 2008 (2008 farm bill; P.L. 110-246 ) generally expired beginning on September 30, 2012. But the American Taxpayer Relief Act ( P.L. 112-240 ; January 2, 2013) extended all 2008 farm bill provisions that were in effect on September 30, 2012, for one additional year—that is, for FY2013 and the 2013 crop year.

Parts of the 2008 farm bill expired again in October 2013 and, technically, implementation of an outdated permanent law would have been imminent for dairy in January 2014, had it not been for the stated resolve to complete the conference negotiations. After the passage of the Agricultural Act of 2014 (2014 farm bill; P.L. 113-79 ) on February 7, 2014, expiration will not be an issue again until 2018.

Expiration of the 2008 farm bill was an issue because the 112 th Congress made limited progress on a farm bill in 2012. The Senate passed S. 3240 , but the House committee-reported bill ( H.R. 6083 ) never reached the floor. Concern over budgetary reductions complicated the bills' progress. This impasse led to the one-year extension in P.L. 112-240 .

Similar difficulties faced the farm bill in 2013. The Senate passed S. 954 on June 10, 2013. The House rejected a committee-reported bill ( H.R. 1947 ) on June 20, mostly over disagreements about the nutrition title. The House passed a "farm-only" bill ( H.R. 2642 ) on July 11 without the nutrition title, and on September 19 passed a stand-alone nutrition bill ( H.R. 3102 ). The House subsequently adopted a resolution ( H.Res. 361 ) that combined the texts of H.R. 2642 and H.R. 3102 into one bill ( H.R. 2642 ) for purposes of a conference committee with the Senate. The final 2014 farm bill was not conferenced and enacted until February 7, 2014.

What happens if Congress does not enact a new farm bill? Does the fiscal year, calendar year, or crop year matter? Will some programs cease to operate? What is "permanent law" and what does it affect? Do the Supplemental Nutrition Assistance Program (SNAP) and crop insurance benefits end? This report answers these and other questions about the expiration of a farm bill.

Funding Sources Affect Consequences of Expiration

Farm bills include a wide range of authorities, some of which are authorized and funded in the farm bill (mandatory spending), while others are only authorized in the farm bill for their scope but wait for appropriations acts to determine their funding (discretionary spending). These differences affect how the farm bill is constructed and funded under normal circumstances. They also affect what happens when the farm bill expires or when annual appropriations are delayed.

Discretionary Funding

Without a new farm bill or extension, it may appear that many programs would not have statutory authority to receive appropriations (an "authorization of appropriations"), but appropriations law allows the continued operation of a program where only appropriations action has occurred.

The Government Accountability Office (GAO) says there is no constitutional or statutory requirement for an appropriation to have a prior authorization. Congress distinguishes between authorizations and appropriations, but this is a congressional construct. GAO says that "the existence of a statute imposing substantive functions upon an agency that require funding for their performance is itself sufficient legal authorization for the necessary appropriations." For expired authorizations, GAO says that "appropriation of funds for a program whose funding authorization has expired ... provides sufficient legal basis to continue the program."

Discretionary spending is authorized throughout the farm bill. Discretionary programs include most rural development, credit, research, and education programs, and some conservation and nutrition programs. The Supplemental Nutrition Assistance Program (SNAP)—a mandatory program—also requires an appropriation. Some smaller research, bioenergy, and rural development programs receive both mandatory and discretionary funding, but most is usually discretionary. Most agency operations are financed with discretionary funds.

The Congressional Budget Office (CBO) compiles a list of programs with expired authorizations of appropriations. Eighteen agricultural programs received more than $37 million in FY2012 under expired authorizations of appropriations. More than 100 farm bill programs briefly lost their authorization for appropriations at the end of FY2012 and until the one-year extension was passed on January 1, 2013; they received $2.3 billion in FY2012. Farm bill discretionary programs generally were continued under the FY2013 appropriation ( P.L. 113-6 ), the continuing resolution for FY2014 ( P.L. 113-46 ), and the full-year FY2014 appropriation ( P.L. 113-76 ).

Mandatory Funding

Most farm bill programs with mandatory funding have an expiration date either on their program authority or their funding authority. These include SNAP, farm commodity programs, some conservation programs, agricultural trade programs, and foreign food aid programs. For the most part, without reauthorization or extension, these programs would cease to operate or undertake new activities. Some exceptions to that rule are:

SNAP, which can be continued via appropriations action even if its authorization for appropriations is expired. Crop insurance, which is permanently authorized, and Some conservation programs, which were extended separately through FY2014.

Mandatory spending is used primarily for the farm commodity programs, crop insurance, nutrition assistance programs, and some conservation and trade programs. Some smaller research, bioenergy, and rural development programs sometimes receive mandatory funding, but their combined share—however important to their own operations—is less than 1% of the total. Nutrition assistance was the largest category in 2013, with 79% of mandatory funding available to write the 2014 farm bill ($764 billion in the 10-year CBO May 2013 baseline for FY2014-FY2023). Other primary programs with mandatory funding were crop insurance (9%, or $84 billion), conservation (6%, or $62 billion), and farm commodity programs (6%, or $59 billion).

Programs relying on mandatory funding—provided by the farm bill—are perhaps the most at risk for interruption, since their authorization and funding both require farm bill action. Yet, unlike discretionary programs, many farm bill programs with mandatory funding have their own source of funding via the CBO baseline. The enacted extension in January 2013 continued these programs for one additional year until September 30, 2013, or in the case of the farm commodity programs through crop year 2013. The baseline required no cost to extend the farm commodity, conservation, trade, and nutrition programs.

However, another subset of mandatory programs did not have baseline beyond FY2012. Because these programs lacked built-in budgetary resources, offsets were needed to provide future funding. This group included certain agricultural disaster assistance programs, certain conservation programs, specialty crop research and grants, organic research and certification, beginning and socially disadvantaged farmer programs, rural development, bioenergy, and farmers market promotion programs. The extension did not provide these programs any mandatory funding, although many would have been funded in the new farm bill. The extension added an "authorization of appropriation" for discretionary funding in FY2013. But neither the full-year appropriation for FY2013 ( P.L. 113-6 ) nor the continuing resolution for FY2014 ( P.L. 113-46 ) provided any discretionary funding for these programs. Therefore, these programs remained in an expired state throughout 2013 due to a lack of funding.

Brief History of Farm Bill Formulation, Enactment, and Extension

Farm bills, like other legislation, have become more complicated and politically sensitive. They are taking longer to enact than in previous decades. For example, the 1973 farm bill was enacted less than two months after being introduced. In contrast, the 2008 farm bill took more than a year from when it was introduced. It was complicated by revenue provisions from other committees of jurisdiction, temporary extensions, and presidential vetoes. The 2014 farm bill took more than 18 months from its introduction. It spanned the 112 th and 113 th Congresses; the House rejected a bill, then passed two separate components before procedurally combining them for conference.

Both the 2008 farm bill and the 2002 farm bill had expired for about three months (from October through December in 2012 and 2007, respectively) before extensions were enacted. In each case, the fiscal year began under a continuing resolution before the farm bill extended occurred. The extensions of the 2002 farm bill were for relatively short periods totaling about five months while final negotiations continued. However, the extension of the 2008 farm bill was for a full year since the 112 th Congress ended and the legislative process needed to restart in the 113 th Congress. Appendix A contains a history of major legislative action on farm bills since 1965.

Timelines

Enacting farm bills after the end of the fiscal year (in which a farm bill expired) is commonplace. In the past 48 years, only the 1973 and 1977 farm bills were enacted before September 30. Farm bills in 1965, 1970, 1981, 1985, and 1990 were enacted by December 31, a few months after the end of the fiscal year but still before spring-planted crops covered by the new law were planted. The most recent four farm bills have been enacted later, in April (1996), May (2002), June (2008), and February (2014), prior to the first crop harvested and covered by the farm bill.

The House and Senate have taken turns as the first chamber to take action on a farm bill. Since 1965, the Senate was first to mark up a farm bill in 1973, 1977, 1981, 2012, and 2013. The House was first to mark up farm bills in 1965, 1970, 1985, 1990, 1995 (and 1996), 2001, and 2007.

Since 1965, 8 out of 12 farm bills were introduced in the first session of a two-year Congress (the odd-numbered year); the exceptions are the 1970, 1990, and 2014 farm bills. The April and July introductions in 2012 for the 2014 farm bill were the latest such dates during a two-year Congress. Until the development of the 2014 farm bill that began in 2012, no farm bill has started in one Congress and needed to be reintroduced in a subsequent Congress. Enactment of the past five farm bills (1990-2014) have been in the second session (the even-numbered year), although except for the 1990 farm bill, some action had occurred in the prior year. Only the 1970 and 1990 farm bills were enacted after an election during a lame-duck Congress.

A nutrition title has been part of each enacted farm bill since and including the 1973 farm bill. Since then, H.R. 2642 (as introduced and initially passed in 2013) has been the only chamber-passed proposal to exclude nutrition programs.

Extensions

Extensions of a prior farm bill are less common. Since 1970, only the two most recent farm bills—the 2002 farm bill and the 2008 farm bill—have required extensions as their successors were being written and enactment was delayed. The 1965 farm bill was extended for one year, but that extension occurred more than a year before expiration and the reauthorization process began.

The 1996 and 2002 farm bills may appear to have been delayed, but their predecessors did not require extensions. The 1990 farm bill did not need to be extended because its original expiration dates had been extended by amendments in budget reconciliation. The 1996 farm bill did not need to be extended because the 2002 farm bill was enacted earlier than necessary.

Extensions are rare in part because appropriations can continue discretionary programs and the SNAP program. The primary concern regarding extension becomes the expiration of mandatory programs whose funding is included in the farm bill. Most provisions can be continued by temporary extensions. However, those that expire before the end of the farm bill and those that do not have continuing funding in the baseline budget cannot be as easily extended unless offsets are included, which can complicate extension.

When the 2002 farm bill expired, portions (but not all) of it were extended six times for less than a year, beginning in December 2007. The first of those extensions, in December 2007, continued authority for many expiring programs for about three months. Because final agreement was pending, five more month- or week-long extensions were needed. These extended all 2002 farm bill provisions that were in effect on September 30, 2007, with a few exceptions. Dairy and sugar programs were included, as were price support loan programs for wool and mohair. But the direct, counter-cyclical, and marketing loan programs for the 2008 crop year for all other supported commodities specifically were not extended (i.e., the primary supported commodities such as feed grains, oilseeds, wheat, rice, cotton, and peanuts). The first extension in December 2007 did not address permanent law, but the second and subsequent extensions in 2008 did extend the 2002 farm bill's suspension of permanent law.

When the 2008 farm bill expired on September 30, 2012, the appropriations continuing resolution ( P.L. 112-175 , §§101, 111) continued the discretionary programs, SNAP, and certain related nutrition programs. Certain other mandatory programs such as the Market Assistance Program and the Conservation Reserve Program ceased to operate insofar as new activity. The farm commodity programs operated to finish the 2012 crop year, but could not continue if the 2013 crop year began without reauthorization or extension. On January 1, 2013, the entire 2008 farm bill, as it existed on September 30, 2012, was extended for the 2013 fiscal year and the 2013 crop year ( P.L. 112-240 ). This avoided reverting to permanent law for the farm commodity programs, which for the dairy programs was imminent. Provisions in the extension continued the dairy price support program until December 31, 2013. Programs that did not have budget authority in the baseline for FY2013 were not provided additional mandatory funding.

The end of 2013 somewhat repeated the situation at the end of 2012. Most of the farm bill expired again on October 1, 2013. Some programs ceased new operations, while others were able to continue under appropriations. From January 1, 2014, until enactment on February 7, 2014, the dairy program technically had reverted to an outdated 1949-era permanent law, though USDA did not implement it since a conference agreement was imminent. For SNAP and the discretionary programs, farm bill expiration coupled with the two-week lapse in FY2014 appropriations (the "government shutdown") during October 2013 did cause challenges for some operations.

Farm Commodity Support Programs

The farm commodity price and income support programs raise farm income by making payments and reducing financial risks from uncertain weather and market conditions. Government-set target prices offer payments when market prices fall below support levels.

Originally, the last year for the 2008 farm bill's commodity programs was the 2012 crop year—that is, crops harvested during 2012 and marketed during the following year. Dairy price supports and export incentives were to expire on December 31, 2012, and the milk income loss contract (MILC) on September 30, 2012.

The one-year extension in the American Taxpayer Relief Act ( P.L. 112-240 ) covered the 2013 crop year for all covered commodities as they were available for the 2012 crop year. The extension continued the farm commodity programs that were in effect in 2012, including the $5 billion per year "direct payment" payment program, which paid farmers a fixed amount regardless of price or yield conditions. It also extended the dairy price support program until December 31, 2013, and the MILC program until September 30, 2013.

The new effective deadlines for enacting the farm bill were January 1, 2014, for dairy, and when the first supported commodity would have been harvested in the 2014 crop year.

In December 2013, the House passed a one-month extension of the farm bill that would have extended program authorities until January 31, 2014 ( H.R. 3695 ). The intent was to avoid the uncertainty of permanent law for dairy programs while conference negotiations were completed. The Senate did not act on the extension. From January 1, 2014, until enactment of the 2014 farm bill on February 7, 2014, the dairy program technically had reverted to the outdated 1949-era permanent law, though USDA did not implement it since conference negotiations were proceeding. USDA had indicated that a short-term extension was not be necessary if a new farm bill was completed in January, since the rollout of procedures to implement permanent law would take a month or more.

Possible Reversion to Permanent Law

Farm commodity support policy has evolved over time via successive farm bills that update and supersede prior policies. However, a set of non-expiring provisions remain in statute and are known as "permanent law." These provisions were enacted primarily in the Agriculture Adjustment Act of 1938 and the Agricultural Act of 1949, as amended by subsequent farm bills. As more modern farm bills evolved away from using the permanent law provisions, they have suspended permanent law, but only for the duration of each farm bill. If no action is taken before expiration, the suspension of permanent law expires, and the essentially mothballed permanent law policies would resume.

The House farm bill ( H.R. 2642 ) that was part of the conference negotiations would have repealed the 1938 and 1949 permanent laws. In their place, the new farm commodity program would have become the permanent law since it would have applied to "the 2014 crop year and each succeeding crop year." The Senate bill ( S. 954 ) continued the long-standing suspension of permanent law, as did the initial House bill ( H.R. 1947 ). The enacted 2014 farm bill did not repeal permanent law but continued to suspend it.

Proposals to repeal permanent law have been rare, though some have had support ( Appendix B ).

Description of Permanent Law

The commodity support provisions of the 1938 and 1949 permanent laws are commonly viewed as being so radically different from current policy—and inconsistent with today's farming practices, marketing system, and international trade agreements—as well as potentially costly to the federal government that Congress is unlikely to let permanent law take effect. Permanent law provides mandatory support for basic crops through nonrecourse loans. It does not authorize more modern support approaches such as loan deficiency payments, counter-cyclical payments, revenue-based payments, decoupled direct payments, or milk income loss contracts.

Government Costs under Permanent Law

A 1985 USDA report analyzed possible economic consequences of permanent law and found significant market intervention and increased government expenditures. Since then, no agency has released a comprehensive budget estimate of reverting to permanent law. Neither the Congressional Budget Office, the U.S. Department of Agriculture (USDA), nor the Food and Agriculture Policy Research Institute (FAPRI) have made official estimates.

However, the White House issued an estimate for dairy in 2013. It suggested that permanent law could cost the government over $12 billion per year for dairy —compared with projected 2008 farm bill outlays of less than $100 million per year —and result in milk prices doubling. This is consistent with an extrapolation of the 1985 USDA report using modern prices and production levels that suggests outlays between $10 billion to $12.5 billion per year for dairy.

Implementing Permanent Law

Without statutory instructions to the contrary, USDA would be required to implement permanent law if the farm bill expires and its associated suspension of permanent law expires. USDA outlined in 2008 how it would implement permanent law in the absence of a new farm bill.

However, given the nature of permanent law and the differences compared to current law, USDA may need time to develop the processes to implement permanent law and thus may not be ready to implement it immediately upon reversion. Therefore, although permanent law immediately may become the "law of the land" once a farm bill expires and new farm output is ready to be marketed, the practical effect of implementing permanent law may be more gradual. However, the duration of an implementation delay is unknown since it has not occurred, and depends on administrative actions. Counting on a delay of a definite time may have risks.

Nonetheless, USDA Secretary Visack indicated in 2013 that it could take at least a month to implement permanent law. He said that a short-term farm bill extension may not be necessary if a new farm bill was enacted during January 2014: "What I have indicated to Senator Stabenow is that it is unlikely, given the complexity of what would be required to implement the [permanent] law, that we would have that in place through the month of January."

Use of Parity Prices and Production Controls

Support under permanent law uses the concept of "parity prices." Parity refers to the relationship between prices that farmers receive for their products and prices they pay for inputs. Support prices would be set to guarantee producers 50% to 90% of parity using the 1910-1914 ratio as a benchmark. However, productivity gains and technological advances over the past 100 years have made parity ratios out of touch with (and possibly irrelevant to) modern farming practices.

Under permanent law, nonrecourse loan rates could be as high as 90% of parity, but not less than 50% of parity for corn, wheat, and rice, and 65% of parity for cotton. Milk support would be between 75% and 90% of parity. Even if support levels were set at the lower end of the range in permanent law (e.g., 50%-75% of parity prices), permanent law supports could have been above 2013 market prices for all supported commodities and resulted in federal greater outlays than under the 2008 farm bill ( Figure 1 and Table 1 ).

For example, in November 2013, the "all milk" market price was $21.30 per hundredweight (cwt.). At this price, no support was needed under the 2008 farm bill effective support level of $9.90/cwt. But under permanent law, even this market price was well below the $37.20/cwt. calculated minimum support level (75% of parity; Figure 1 ).

Under permanent law, nonrecourse loan rates for wheat, rice, cotton, corn, and other feed grains function as farm price supports. Unless commercial markets pay more than the nonrecourse loan prices, farmers could put their crops under loan and forfeit the commodities to USDA when the nine-month loans mature. However, to avoid forfeiture problems, USDA has permanent authority allowing farmers to repay nonrecourse loans for less than the principal (loan rate) plus interest, similar to marketing loans in the modern commodity program.

Additional production controls exist for wheat and cotton. Permanent law requires USDA to announce acreage allotments and marketing quotas during the prior crop year, and to hold producer referenda on implementing marketing quotas. A two-thirds affirmative vote for marketing quotas results in the highest levels of support, with mandatory restrictions on acreage (and the quantity eligible for support).

As implied by Table 1 , not all commodities in the 2008 (or 2014) farm bill that receive federal support are covered by permanent law. The commodities that would lose mandatory support include soybeans and other oilseeds, peanuts, wool, mohair, sugar beets and sugar cane, dry peas, lentils, and small and large chickpeas. Parity-based supports once existed for wool, mohair, and peanuts, but were repealed. Parity support is not allowed for oilseeds or sugar. A different set of commodities could receive support under discretionary authority given to the Secretary of Agriculture in the Agricultural Act of 1949 and the CCC Charter Act. But for budgetary and other reasons, such discretionary authority rarely has been used.

Legislative Options Under Permanent Law

Some see the existence of permanent law as an assurance for farm bill supporters that the farm commodity programs will be revisited every time a farm bill expires. Congress is not likely to let a farm bill expire without taking some action eventually, given the undesirable consequences of permanent law. Permanent law, however badly it may be perceived, has stayed on the books, and each new farm bill has suspended it for the duration of the farm bill. Several legislative options exist as a farm bill approaches expiration:

1. Pass a new farm bill (and reinstate the suspension of permanent law). 2. Pass an extension of the current farm bill (with its suspension of permanent law). 3. Do nothing (revert to permanent law). 4. Suspend permanent law (but no new farm bill or extension). 5. Repeal permanent law, and then do one of the following: a. pass a new farm bill (with or without a new permanent law provision); b. pass an extension of the current farm bill; c. do nothing (no new farm bill).

The existence of an outdated permanent law likely forces Congress to take action, because inaction has unacceptable consequences—that is, reverting to a policy that almost everyone would regret. If Congress cannot reach agreement on a new farm bill, then the path of least resistance probably is extending the current farm bill rather than doing nothing and reverting to permanent law—but this, too, requires legislative action, which may pose other challenges.

For those who oppose the farm commodity programs, repealing permanent law would allow Congress to debate farm supports without the permanent law consequence of inaction. But repealing permanent law requires legislative action. Some believe that it is easier to negotiate and pass a new farm bill than to deal with the question of repealing permanent law.

Proposals to repeal permanent law are discussed in Appendix B .

Crop Insurance

The federal crop insurance program protects producers against losses in crop revenue or yield through federally subsidized policies purchased by producers. The program is permanently authorized by the Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et seq.). A reauthorization of the program is not needed in the farm bill. Producers who grow a crop that is ineligible for crop insurance may be eligible for a direct payment under USDA's Noninsured Crop Disaster Assistance Program (NAP). Like crop insurance, NAP has permanent authority under Section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333).

Conservation Programs

In 2013, USDA administered more than 20 agricultural conservation programs. These programs addressed natural resource concerns on private agricultural and forested lands through technical and financial assistance. Many conservation programs had different expiration dates for program and funding authority ( Table 2 ). Because of this and appropriations peculiarities, they were affected differently by the 2008 farm bill expiration and extension.

For many conservation programs, program authority is permanent under the Food Security Act of 1985, but the authority to receive mandatory funding expires. The one-year 2008 farm bill extension allowed programs with expired mandatory funding authority to continue until September 30, 2013, if the program had baseline beyond FY2012. The Conservation Reserve Program's (CRP's) funding and program authority expired at the end of FY2012 and was extended to the end of FY2013 in the one-year farm bill extension. Because CRP had baseline beyond FY2012, the program continued in FY2013 at the original authorized rate of enrollment—up to 32 million acres at any one time. Without reauthorization or a further extension of mandatory funding and program authority, expired conservation programs were unable to sign new contracts or enroll additional acres after September 30, 2013. All existing contracts and agreements stayed in force for the contract period, and payments continued to be made.

Other expired mandatory conservation programs had limited baseline beyond FY2012 as a result of previous reductions in annual appropriations. For example, the Wetlands Reserve Program (WRP) had authority under the 2008 farm bill to enroll no more than 3.04 million acres before FY2012, and did not include budgetary baseline beyond FY2012. Temporary reductions in FY2011 and FY2012 annual appropriations acts limited USDA's ability to enroll the authorized level of acres. This resulted in limited baseline being carried forward into FY2013, whereas it would have otherwise been expended by the end of FY2012. With the one-year extension, WRP was able to use this additional baseline to enroll a limited number of acres within its original authorized acreage cap.

A different set of mandatory conservation programs had no baseline beyond FY2012 and therefore required offset funding in order to be continued (e.g., Healthy Forest Reserve Program and Voluntary Public Access and Habitat Incentives Program, VPAHIP).

Other budget enforcement rules and appropriations dynamics affected particular farm bill conservation programs. The Congressional Budget Office used the last year of authorization to determine the 10-year funding baseline for the farm bill reauthorization. Because the FY2012 Agriculture Appropriations Act ( P.L. 112-55 ) reduced spending for select mandatory conservation programs and could have reduced the multi-year budget baseline, it extended the funding authority expiration date for five of these programs, including Agricultural Management Assistance (AMA), the Conservation Stewardship Program (CSP), the Environmental Quality Incentives Program (EQIP), the Farmland Protection Program (FPP), and the Wildlife Habitat Incentives Program (WHIP). This allowed appropriators to score savings in FY2012, but not affect the overall farm bill baseline since program authority for many of the reduced programs was extended to 2014. Thus, even without a reauthorization of the 2008 farm bill, the five programs continued to operate.

Several conservation programs also have permanent program authority, but are authorized to receive discretionary funds appropriated annually. Funding for these programs varies and is based on appropriated levels. Some discretionary programs with authorization to receive appropriations expired at the end of FY2013. Similar to other discretionary programs with expired authority, the program can continue as long as it receives appropriated funding. Table 2 separates the conservation programs by funding authority type—mandatory and discretionary.

Other farm bill provisions affecting agricultural conservation also expired. The adjusted gross income requirement that limited eligibility for conservation programs, no longer applied to conservation programs during the expiration period. However, compliance activities and regional equity funding requirements continued for programs authorized beyond September 30, 2013.

SNAP and the Other Nutrition Programs

As discussed earlier, expiration and extension of SNAP (and the related nutrition programs in the 2008 farm bill) hinge on whether funding is available. The nutrition authorizations in the 2008 farm bill expired after September 30, 2012, and were extended another year by P.L. 112-240 . They expired again after September 30, 2013, yet operations for the most part were able to continue under the short-term appropriations continuing resolution ( P.L. 113-46 ) and the full-year FY2014 appropriation ( P.L. 113-76 ).

The impact on operations is based on factors related to their authorizing statutes, appropriations actions, and the terms of a farm bill extension (if applicable).

The 2008 farm bill reauthorized a number of domestic food assistance programs, including the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps), the Emergency Supplemental Food Assistance Program (TEFAP), the Commodity Supplemental Food Program (CSFP), the Food Distribution Program on Indian Reservations (FDPIR), the Senior Farmers' Market Nutrition Program, the Bill Emerson Hunger Fellowship Program, Community Food Projects, Nutrition Assistance block grants for American Samoa and Puerto Rico, and Hunger-Free Communities grants. With regard to expiration or extension, these programs fell into one of three categories:

1. Programs that were permanently authorized and funded,

2. Programs that can be continued solely by appropriations action, or

3. Programs or authorities which would have expired without extension or reauthorization.

These categories are elaborated upon below. The majority of farm bill nutrition programs (and the majority of nutrition spending) falls in the second category

Permanently Authorized and Funded Programs

The 2008 farm bill included an expansion of the Fresh Fruit and Vegetable Program (FFVP, "snack" program), and permanently funded it through Section 32. As a result, the Fresh Fruit and Vegetable Program did not expire.

Programs Continued via Appropriations Action56

Appropriations can allow a program to continue even if the underlying authorization has not been extended. Because many of the nutrition programs are funded by the SNAP account, appropriated funds for SNAP would be enough to extend operations for most of the programs in the Food and Nutrition Act of 2008. As such, the first weeks of FY2014—with an expired farm bill extension and lapsed appropriations—presented unique circumstances (see the text box below).

The farm bill nutrition provisions listed below could have continued to operate if funds were appropriated to the SNAP account, but would have expired in the absence of a SNAP account appropriation. The CR ( P.L. 113-46 ) and the full-year appropriation ( P.L. 113-76 ) continued funding for the SNAP account, so these programs continued to operate:

Most aspects of SNAP operations (except for the Healthy Incentives Pilot). Purchase and distribution of TEFAP commodities (administrative costs could continue with appropriations for the Commodity Assistance Program account). Most aspects of FDPIR (except as listed below). Nutrition assistance funding for Puerto Rico, American Samoa, and Commonwealth of Northern Mariana Islands. Community Food Projects (administered by the National Institute of Food and Agriculture).

For CSFP, the authority to fund commodity purchases and administrative costs would have expired without an extension of the authority or without an appropriation. However, all program operations continued under CSFP appropriations.

Programs That May Expire Without Reauthorization or Extension

For the Senior Farmers' Market Nutrition Program (SFMNP), the 2008 farm bill contained both the authority and the funding (a transfer from the Commodity Credit Corporation). Therefore, authority and funding for this program expired after September 30, 2012. Once P.L. 112-240 was enacted, the funding and authority to operate the SFMNP was extended through September 30, 2013. However, it expired again when that extension expired.

The following programs required either (a) an extension of the authority and specific appropriations language or (b) specific appropriations to operate. (No appropriations were made for these programs in FY2013 or FY2014; their authorities were extended by P.L. 112-240 but expired on September 30, 2013. Therefore, these authorities are not operational.)

Hunger-Free Communities grants. SNAP pilot projects to evaluate health and nutrition promotion. This authority and funding was used to operate the Healthy Incentives Pilot program. The program could have continued to use existing funding beyond FY2013 but any additional funding would have needed specific authorization and appropriation. FDPIR's "Traditionally and Locally Grown Food Fund." Since it was not implemented, only an extension of the authorization with appropriations or a specific appropriation would extend it. Nutrition Information and Awareness Pilot Program. This authority was provided in the 2002 farm bill and reauthorized in the 2008 farm bill, but it was inactive. Several authorities relating to USDA's purchase and national processing of commodity foods.

Trade and Foreign Food Aid Programs

Several agricultural trade and international food aid programs would have expired without the new farm bill.

The trade programs with mandatory funding that were affected were export credit guarantees (including those for emerging markets), facilities credit guarantees, export market promotion (the Market Access Program and the Foreign Market Development Program), dairy export subsidies, and technical assistance for specialty crops. Without new mandatory program authority, the Commodity Credit Corporation would not have been able to enter into agreements to guarantee U.S. commercial banks against defaults by foreign purchasers of U.S. agricultural commodities, fund grants to trade associations for the promotion of U.S. agricultural exports in foreign markets, or fund activities to address sanitary and phytosanitary (SPS) barriers to U.S. agricultural exports.

The international emergency and non-emergency food aid programs that were affected were the Food for Peace Act, which is reauthorized in the farm bill, and the related agricultural technical assistance (the Farmer-to-Farmer program) in sub-Saharan African and Caribbean countries. Authority to provide commodities and pay transportation costs under the Food for Progress program was affected, as was authority to replenish stocks of the Bill Emerson Humanitarian Trust—a reserve of commodities and cash used to meet unanticipated food aid needs. The authorization of appropriations for the McGovern-Dole International Food for Education and Child Nutrition Program was affected, though the annual appropriation continued to fund this discretionary program.

Appendix A. Farm Bill Legislative Action Since 1965

Presidential Vetoes

Presidential vetoes of farm bills are not common. Two complete farm bills have been vetoed as stand-alone measures (1956 and 2008), the latter being vetoed twice. Another farm bill was vetoed as part of a larger budget reconciliation package (1995).

The first veto of a farm bill was in 1956 when President Eisenhower vetoed H.R. 12, the first version of the Agricultural Act of 1956. The second and third vetoes were in 2008 by President George W. Bush. The 2008 farm bill was vetoed and overridden twice. After the initial veto of the bill ( H.R. 2419 ), Congress overrode the veto and enacted P.L. 110-234 , but accidentally enrolled the law without Title III (the trade title). Congress immediately reintroduced the same bill with the trade title as H.R. 6124 . President Bush vetoed this version as well, and Congress again overrode the veto to enact P.L. 110-246 , a complete 2008 farm bill that included the trade title. The overrides in 2008 were the only time that a farm bill was enacted by overriding a veto.

A 1995 budget reconciliation package that included the first version of what became the 1996 farm bill was vetoed by President Clinton, but the veto was not necessarily due to the farm bill.

Appendix B. Suspensions of "Permanent Law" and Proposals to Repeal It

The "permanent law" provisions for the farm commodity programs were enacted primarily in the Agriculture Adjustment Act of 1938 and the Agricultural Act of 1949. Subsequent farm bills into the 1970s continued to use and amend the permanent law provisions. As more modern farm bills evolved away from using the permanent law provisions, those provisions have been suspended for the duration of each farm bill, rather than being repealed.

If no action is taken when a farm bill expires, then the suspension of permanent law also expires. An "expiration of the suspension" would allow the essentially mothballed policies of permanent law to resume. Some see the existence of permanent law—and the undesirable policy and budget consequences that could result—as an assurance that the farm commodity programs will be revisited every time a farm bill expires.

Suspension

Throughout the 1950s and 1960s, farm bills generally used and amended the 1938 and/or 1949 acts. Amendments sometimes were made permanent and sometimes only applied to specific years. As farm commodity policy continued to evolve away from parity-based price supports and quotas, farm bills in the 1970s gradually began to move away from using the permanent law provisions. Yet, the 1970 and 1973 farm bills, for example, generally were written into the 1938 and/or 1949 farm bills, as amended, with provisions that were applicable only for the new period of the farm bill. Thus, while those farm bills might not have directly suspended permanent law in the same way that more modern farm bills have, they nonetheless supplanted some portion of the permanent law parity-based support system for the life of the farm bill, albeit from within the body of the permanent law itself.

Beginning with the 1977 farm bill, direct suspension or nonapplicability language began to be used regarding the permanent laws. This approach has continued through the 2014 farm bill.

Repeal

Proposals to repeal permanent law have been relatively rare, though some have passed the floor in each chamber.

For example, proposals to repeal permanent law advanced perhaps the farthest during the development of the 1996 farm bill. Repeal provisions may have had saliency then because of a perceived intent of the "Freedom to Farm" reform plans. If Agricultural Market Transition Act (AMTA) payments were to end in 2002 at the end of the farm bill, then the existence of permanent law could have been an obstacle. Whether or not repeal was a condition of the plan during its development, repeal was dropped in favor of continued suspension during conference negotiations in 1996.

More specifically regarding the 1995-1996 developments, the initial bill considered by the House Agriculture Committee in 1995 would have continued to suspend permanent law ( H.R. 2195 , Title IV). After failing in committee, the text of that bill, including the suspension provision, was incorporated into a broader House-passed budget reconciliation package ( H.R. 2491 , §1105). However, the Senate-passed version of the 1995 reconciliation package included a provision to repeal permanent law ( S. 1357 , §1101). The conference agreement for the reconciliation package adopted the Senate approach for repeal ( H.R. 2491 , §1109). The conference agreement passed both the House and Senate, but was vetoed, albeit not because of the farm bill provisions.

The next year, a stand-alone 1996 farm bill was introduced and passed in the House with the provision to repeal permanent law ( H.R. 2854 , §109). The repeal provision also was in the Senate-reported bill ( S. 1541 , §19). However, the Senate-passed version ( S. 1541 , §109) did not repeal permanent law but continued to suspend permanent law. The conference agreement for the 1996 farm bill ( H.R. 2854 , §171) followed the Senate-passed version and continued the suspension of permanent law.

Other bills from 1995 to 2001 proposed repealing permanent law, but were not formally considered. In 1995, several bills were introduced to restructure government agencies. First, a bill was introduced to abolish USDA, eliminate all price support authorities including those of permanent law, and transfer certain powers to the Department of Commerce ( H.R. 1354 , S. 586 ). A broader government-wide restructuring bill also was introduced that would have repealed permanent law ( H.R. 1923 ). A separate agricultural reform bill was introduced that would have phased down agricultural supports and eventually repealed permanent law ( H.R. 2010 ). Two other bills to repeal permanent law were introduced in 1995 ( H.R. 2523 and H.R. 2787 ). In 1997-1998, H.R. 502 and S. 2573 would have repealed permanent law. Other bills to repeal permanent law were H.R. 328 in 1999 and S. 1571 in 2001. None of these bills advanced beyond being referred to committee.

Other bills in various Congresses have been introduced with targeted repeal provisions for certain commodities, but not comprehensive repeal. These bills are not discussed here.

In the 112 th Congress during consideration of the 2012 farm bill, an amendment was submitted, but not actually introduced on the floor, to replace the suspension of permanent law with the repeal of those provisions ( S.Amdt. 2379 to S. 3420 ).

In 2013, the House-passed farm bill ( H.R. 2642 ) would have repealed the 1938 and 1949 permanent laws (§1602). In their place, the House-proposed farm commodity program would have become the permanent law since it would have applied to "the 2014 crop year and each succeeding crop year" (§§1107, 1202, 1204, 1205, 1206, 1301). The Senate bill ( S. 954 ) continued the long-standing suspension of permanent law, as did the initial House-rejected bill ( H.R. 1947 ). The enacted 2014 farm bill continues to suspend permanent law ( P.L. 113-79 , §1602).