FY2018 and FY2019 Agriculture Appropriations: International Food Aid
Released: 2019-05-08T00:00:00

Introduction

The U.S. government administers multiple international food assistance programs that aim to alleviate hunger and improve food security in other countries. Some of these programs provide emergency assistance to people affected by conflict or natural disaster. Other programs provide nonemergency assistance to address chronic poverty and hunger, such as providing food to people during a seasonal food shortage or training parents and community health workers in nutrition.

Current international food assistance programs originated in 1954 with the passage of the Food for Peace Act (P.L. 83-480), also referred to as P.L. 480 . Historically, the United States has provided international food assistance primarily through in-kind a id , which ships U.S. commodities to countries in need. Congress funds in-kind food aid programs through the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act—known as the Agriculture appropriations bill.

In 2010, Congress established the Emergency Food Security Program (EFSP), which provides primarily cash-based food assistance. Cash-based assistance provides recipients with the means to acquire food, including through cash transfers, vouchers, or locally and regionally procured food —food purchased in the country or region where it is to be distributed rather than from the United States. Congress funds EFSP through the International Disaster Assistance (IDA) account in the State, Foreign Operations, and Related Programs (SFOPS) appropriations bill. The IDA account also funds nonfood emergency humanitarian assistance, such as provision of shelter and health services.

This report provides a brief overview of the international food aid-related provisions in the FY2018 and FY2019 enacted Agriculture Appropriations Acts—Division A of the Consolidated Appropriations Act, 2018 ( P.L. 115-141 ) and Division B of the Consolidated Appropriations Act, 2019 ( P.L. 116-6 ). It does not cover programs funded through the SFOPS appropriations bill.

International Food Aid Programs

Congress funds most U.S. international food aid programs with discretionary funding provided through annual appropriations bills. Some international food aid programs receive mandatory funding financed through USDA's Commodity Credit Corporation (CCC) and do not require a separate appropriation. Congress authorizes discretionary and mandatory funding levels for international food aid programs in periodic farm bills, most recently the Agriculture Improvement Act of 2018 ( P.L. 115-334 ). Table 1 lists each international food aid program that receives funding through agriculture appropriations.

Programs Reliant on Discretionary Funding

The Food for Peace Act of 1954 (P.L. 83-480), as amended, authorizes four international food assistance programs. The Agriculture appropriations bill provides discretionary funding for three Food for Peace (FFP) programs—FFP Title I, FFP Title II, and FFP Title V—which are discussed below.

1. FFP Title I provides concessional sales —sales on credit terms below market rates—of U.S. commodities to governments of developing countries and private entities. USDA administers FFP Title I. Congress has not appropriated funds for new FFP Title I sales since FY2006 but continues to appropriate funds to administer the FFP Title I loans provided before FY2006. The appropriation for FFP Title I administrative expenses also funds administrative expenses for the Food for Progress Program, which supports economic development projects. 2. FFP Title II is a donation program under which U.S. agricultural commodities are distributed to recipients in foreign countries. The U.S. Agency for International Development (USAID) administers FFP Title II. Since the mid-1980s, FFP Title II has received the majority of funds appropriated to international food aid in the Agriculture appropriations bill. 3. FFP Title V, also known as the Farmer-to-Farmer Program, finances short-term placements for U.S. volunteers to provide technical assistance to farmers in developing countries. USAID administers the Farmer-to-Farmer Program. The program does not receive direct appropriations, but receives a portion of the total funds appropriated for FFP programs. Statute requires that the program receive the greater of $15 million or 0.6% of the funds annually appropriated for FFP programs.

The Agriculture appropriations bill also provides funding for the McGovern-Dole International Food for Education and Child Nutrition Program. This program donates U.S. agricultural commodities to school feeding programs and pregnant or nursing mothers in qualifying countries.

Programs with Mandatory Funding

Congress has authorized certain U.S. international food aid programs to receive mandatory funding. The Food for Progress Program donates U.S. agricultural commodities to governments or organizations to be monetized —sold on local markets in recipient countries to generate proceeds for economic development projects. Congress has authorized Food for Progress to receive both mandatory and discretionary funding. The program receives discretionary funding for administrative expenses through the appropriation for FFP Title I administrative expenses.

The Bill Emerson Humanitarian Trust (BEHT) is a reserve of funds or commodities held by the CCC. USDA can use BEHT funds or commodities to supplement FFP Title II activities, especially when FFP Title II funds alone cannot meet international emergency food needs. If USDA provides aid through BEHT, Congress may appropriate funds to the CCC in a subsequent fiscal year to reimburse the CCC for the value of the released funds or commodities. USDA did not release funds or commodities from BEHT in FY2017 or FY2018, and Congress did not appropriate any BEHT reimbursement funds to the CCC in FY2018 or FY2019.

Administration's Recent Budget Requests

The Trump Administration's FY2018 budget request proposed eliminating McGovern-Dole and FFP Title II and moving funding for international food aid to the IDA account within the SFOPS appropriations bill. The FY2019 budget request repeated the proposed eliminations and reorganization from the FY2018 request. It also contained a new proposal to eliminate Food for Progress. Congress did not adopt the Administration's FY2018 or FY2019 proposals to eliminate FFP Title II, McGovern-Dole, or Food for Progress. This section summarizes the FY2018 and FY2019 Administration's budget requests for U.S. international food aid programs.

Funding Request for FY2018

For FY2018, the Trump Administration requested discretionary funding for one international food aid program account. The Administration requested $149,000 for administrative expenses to carry out Food for Progress projects and existing FFP Title I loans. This amount would have been equal to the FY2017 enacted amount for administrative expenses.

The FY2018 request proposed eliminating McGovern-Dole "as part of the Administration's effort to reprioritize Federal spending." The Administration stated that "in the most recent report in 2011, the [Government Accountability Office (GAO)] found weaknesses in performance monitoring, program evaluations, and prompt closeout of agreements." According to the GAO's Recommendations Database, USDA has taken actions to satisfy the three recommendations made in the 2011 audit, and these recommendations have been closed as of July 2015.

The Administration also proposed eliminating FFP Title II. The Administration stated: "There is no funding request for [FFP] Title II, as part of an Administration effort to streamline foreign assistance funding, prioritize funding, and use funding as effectively and efficiently as possible. The 2018 request includes funding for emergency food needs within the International Disaster Assistance account." Eliminating FFP Title II would fund the majority of U.S. international food assistance through the IDA account in the SFOPS appropriations rather than shared between IDA and the FFP Title II account in the Agriculture appropriations bill.

The IDA account provides funding for EFSP. FFP Title II and EFSP account for the majority of U.S. international food assistance funding, representing 87% of total international food assistance outlays in FY2016. Combined FY2016 outlays for FFP Title II and EFSP totaled $2.730 billion. The Administration's FY2018 SFOPS budget request proposed that $1.511 billion of IDA funds be directed to international food assistance. This amount would have been 45% less than combined FY2016 outlays for FFP Title II and EFSP.

Funding Request for FY2019

In its FY2019 request, the Trump Administration repeated many of its proposals from FY2018, including eliminating McGovern-Dole and FFP Title II. The Administration's FY2019 SFOPS budget request proposed $1.554 billion of IDA funds be used for emergency food assistance. This amount would be 43% less than the combined FY2016 outlays for FFP Title II and EFSP, which totaled $2.730 billion. The Administration also proposed eliminating Food for Progress, a change from its FY2018 budget request. The Administration requested $142,000 for administrative expenses to carry out existing Food for Progress projects and existing FFP Title I loans. This amount is 4.7% less than the $149,000 that Congress enacted for administrative expenses in FY2018.

Potential Implications of the FY2018 and FY2019 Funding Requests

Moving funding from FFP Title II to IDA could potentially change how the United States delivers food aid to recipient countries. Statute requires that nearly all aid distributed under FFP Title II be in-kind aid. EFSP, which Congress funds through the IDA account, does not have a statutory requirement to provide a portion of assistance as in-kind aid. EFSP can provide in-kind aid or cash-based assistance, such as direct cash transfers, vouchers, or locally and regionally procured food. Shifting international food aid funding from FFP Title II to IDA could increase the portion of food assistance provided as cash-based assistance rather than in-kind aid.

Proposals to shift U.S. international food assistance funding from in-kind food aid to cash-based food assistance are not new. Both the Obama and George W. Bush Administrations proposed increasing the portion of U.S. international food aid delivered as cash-based assistance. Some proponents of increasing the use of cash-based assistance argue that it could improve program efficiency. However, some interested parties assert that the Trump Administration's proposed decrease in overall funding for international food assistance could result in fewer people receiving assistance and therefore counteract potential efficiency gains. Some opponents of increasing the share of food assistance that is cash-based rather than in-kind maintain that in-kind aid ensures that the United States provides high-quality food to recipients. Some opponents also assert that increasing the use of cash-based assistance could diminish support for international food aid programs among certain stakeholders, such as selected agricultural commodity groups, and potentially some lawmakers.

Congressional Appropriations

Both the FY2018 and FY2019 Agriculture Appropriations Acts provided funding for U.S. international food aid programs in the Foreign Assistance and Related Programs (Title V) and General Provisions (Title VII) titles. This included funding for FFP Title II and McGovern-Dole. The acts also provided funding for administrative expenses to manage existing FFP Title I loans that originated while the FFP Title I program was active. The FY2019 act also provided funding for the Food for Progress program, which typically receives only mandatory funding. Figure 1 shows funding trends for international food aid programs funded through Agriculture appropriations bills for FY2013-FY2019.

Appropriations for FY2018

The FY2018 Agriculture Appropriations Act (Division A of P.L. 115-141 ) provided $1.924 billion for international food aid programs, a 7% increase from the FY2017 enacted total of $1.802 billion ( Table 2 ). The FY2018 total was also an increase from the FY2018 Senate-passed ($1.807 billion) and House-passed ($1.602 billion) Agriculture appropriations bills. Congress did not adopt the Administration's FY2018 proposals to eliminate FFP Title II or McGovern-Dole.

The FY2018 act provided $1.716 billion for FFP Title II, a 7% increase from the $1.6 billion provided in FY2017 Agriculture appropriations. In FY2017, Congress directed $300 million of IDA funds in SFOPS appropriations be transferred to the FFP Title II account in Agriculture appropriations ( P.L. 115-31 , Division J, §8005(a)(1)(A)). When including this transfer of funds, FFP Title II received a total of $1.9 billion in funding in FY2017. Total FFP Title II funding of $1.716 in FY2018 would represent a 10% decrease from the FY2017 total of $1.9 billion.

FY2018 enacted funding of $1.716 billion for FFP Title II includes $1.6 billion provided in the Foreign Assistance title and $116 million provided in the General Provisions title of the Agriculture Appropriations Act. The funding Congress provides in the Foreign Assistance title is a base amount that is often compared across fiscal years to determine whether program funding has increased or decreased. Providing additional FFP Title II funding in the General Provisions title effectively increases funding available for FFP Title II in a given fiscal year without increasing base funding in the Foreign Assistance title.

The FY2018 act also provided $207.6 million for McGovern-Dole, a 3% increase from the $201.6 million that Congress provided in FY2017. Congress directed that $10 million of McGovern-Dole funding be made available for local and regional procurement (LRP), a $5 million increase from the $5 million set-aside for LRP in FY2017. The FY2018 act also provided $149,000 for FFP Title I and Food for Progress administrative expenses, which was unchanged from the amount enacted for FY2017.

Appropriations for FY2019

The FY2019 Agriculture Appropriations Act (Division B of P.L. 116-6 ) provides $1.942 billion in total funding for international food aid programs, a 1% increase from the FY2018 enacted amount of $1.924 billion. The enacted total for FY2019 is also an increase from the FY2019 Senate-passed ($1.926 billion) and House-reported ($1.743 billion) Agriculture appropriations bills. Congress did not adopt the Administration's FY2019 proposals to eliminate FFP Title II, McGovern-Dole, or Food for Progress.

The FY2019 act provides $1.716 billion for FFP Title II, equal to the FY2018 enacted amount. This includes $1.5 billion in the Foreign Assistance title and an additional $216 million in the General Provisions title. The act also provides $210.3 million for McGovern-Dole, a 1% increase from the $207.6 million provided in FY2018. The FY2019 act also directs $15 million of McGovern-Dole funding be made available for LRP, a $5 million increase from the $10 million set-aside for LRP in FY2018.

The FY2019 act provides $142,000 for FFP Title I and Food for Progress administrative expenses, a 5% decrease from the FY2018 enacted amount of $149,000. The act also provides $16 million for Food for Progress in the General Provisions title, including $6 million in discretionary appropriations and a $10 million Change in Mandatory Program Spending (CHIMP) increase. The FY2019 conference report states that "this increase is a restoration of funding from reductions occurring in prior years and does not indicate support for expanding or continuing the practice of monetization in food aid programs." The FY2019 House-reported bill would have provided $35 million for Food for Progress. Neither the FY2018 act, the FY2019 Administration's budget request, nor the FY2019 Senate-passed bill included discretionary funding for Food for Progress. Food for Progress has not typically received discretionary appropriations; rather it has relied entirely on mandatory funding delivered through the CCC.

Table 2 details appropriations for international food aid programs for FY2017-FY2019, including proposed funding levels in the Administration's FY2018 and FY2019 budget requests and in the House and Senate Agriculture appropriations bills for FY2018 and FY2019.

Policy-Related Provisions

In addition to providing funding, the agriculture appropriations bill may contain policy-related provisions that direct how the executive branch should spend certain funds. Provisions included in appropriations bill text have the force of law but generally only for the duration of the fiscal year for which the bill provides appropriations. Policy-related provisions generally do not amend the U.S. Code . Table 3 compares select policy-related provisions pertaining to U.S. international food aid programs from the Foreign Assistance and Related Programs (Title V) and General Provisions (Title VII) titles of the FY2018 and FY2019 Agriculture Appropriations Acts.

The explanatory statement that accompanies the appropriations act, as well as the committee reports that accompany the House and Senate committee-reported bills, can provide statements of support for certain programs or directions to federal agencies on how to spend certain funding provided in the appropriations bill. While these documents do not have the force of law, they can express congressional intent. The committee reports and explanatory statement may need to be read together to capture all of the congressional intent for a given fiscal year.

Table 4 compares selected policy-related provisions pertaining to U.S. international food aid programs from the FY2018 and FY2019 House and Senate committee reports and explanatory statement for the FY2019 Agriculture Appropriations Act. The FY2018 column includes references to the House (H) and Senate (S) committee reports to allow for consideration of congressional intent. The explanatory statement for the FY2018 Agriculture Appropriations Act did not contain policy-related provisions pertaining to U.S. international food aid programs.