November, 2013

    December 3, 2013


    FASS Submits Comments on REE Action Plan

    USDA Under Secretary for Research, Education and Economics, Cathy Woteki recently developed a revised draft of the REE Action Plan that outlines goals and action items for the National Institute of Food and Agriculture (NIFA), Agricultural Research Service (ARS), Economic Research Service (ERS) and the National Agriculture Statistics Service (NASS). The initial REE Action Plan was released in February of 2012. In response to the REE Mission Area’s request for stakeholder input, FASS submitted its comments to the Under Secretary’s office on November 26th.

    Through its comments, FASS highlighted the Farm Animal Integrated Research 2012 (FAIR 2012) process that was completed last year to identify key priorities for the animal sciences. FASS encouraged incorporation of the FAIR 2012 priorities into the Action Plan and also urged that these priorities are reflected in future budget decisions at USDA. In addition to the research priorities identified by FAIR 2012, FASS highlighted a number of crosscutting issues raised in the FAIR 2012 report that are important factors for the overall success of REE programs. Crosscutting issues include: ensuring a balanced portfolio, having a proper mix of size and scope of projects, enhanced collaborations across agencies, improving public perception of animal agriculture, consistency and predictability of regulations, and utilization of data mining.

    After considering stakeholder comments, it is expected that USDA will publish the revised REE Action Plan early next year.

    No Deal Yet on Farm Bill Conference

    Leaders of the House and Senate Agriculture Committee met multiple times during the week of November 18th in an attempt to resolve their differences on the Farm Bill. Despite numerous meetings, no deal has been reached on some of the key farm safety net policies and reforms to nutrition programs. While major issues on farm and nutrition programs remain outstanding, Congressional staff are making progress on many of the other Farm Bill titles including Research.

    With no deal in place ahead of Thanksgiving, negotiators will only have a small window of time after the Thanksgiving break to get a conference report completed. House leaders have indicated that December 13th is the date when the House will adjourn for the remainder of the year, setting up a hard deadline for the Farm Bill to be completed in calendar year 2013.

    Without a deal by December 13th, pressure will mount for Congress to pass a short term extension to avert what some call the “dairy cliff”. If an extension is not adopted, the suspension of permanent law expires and the 1938 & 1949 permanent law (Agriculture Adjustment Act) would resume. One of the more immediate impacts will be on dairy prices, as USDA would be required to alter the support price for milk in accordance with permanent law. Earlier this year USDA cited some of the potential impacts of reverting back to permanent law. For example, USDA estimated the minimum support level for milk (under 75% of parity in permanent law) would be $38.55/cwt., doubling the August 2013 market price for milk of $19.30/cwt. Such policy change would have a significant impact on milk prices, something that members of Congress will want to avoid.

    Status of Budget Negotiations

    Leaders of the House and Senate Budget Conference Committee continue to meet and are narrowing the scope of their budget negotiations in order to reach an agreement. While no deal has been reached yet, their plan would include: 1.) Providing some relief from the pending $20 billion discretionary budget sequestration set to take effect in mid-January 2014, and 2.) Providing top-line budget numbers for discretionary spending for both the current fiscal year (2014) and 2015.

    Under current law (Budget Control Act (BCA) of 2011) the total FY 2014 discretionary spending level would be reduced from the FY 2013 level of $986 billion to $967 billion. However, budget negotiators including House Budget Chairman Paul Ryan (R-WI) and Senate Budget Chairwoman Patty Murray (D-WA) may soon propose reducing sequestration cuts by $65 billion over the two fiscal years 2014 and 2015. The increased (from BCA level) spending will be offset by reductions in mandatory spending (federal retirement system, Medicare payments to hospitals), increasing user fees (aviation) and the sale of federal assets. Fundamental changes to entitlement programs (that Republicans want) and additional revenue through tax increases (that Democrats want) are off the table.

    It remains uncertain if such softening of the budget sequestration will have significant impacts to research budgets. But, with top-line budget numbers in place for congressional appropriators it will bring more certainty to the budget process – at least for the next 12-to-18 months.

    The House and Senate are currently in recess for the Thanksgiving holiday. The House returns on December 2 and Senate returns on December 9. Both Budget Committee Chairs Murray and Ryan are continuing to talk during the recess with the hope of striking a deal and issuing a report to Congress on, or before their legislated deadline of December 13. If they do reach an agreement both legislative chambers will have up to 6 weeks to review and adopt their proposal before the current continuing resolution (P.L. 113-46) expires on January 15.

    According to the U.S. House calendar there are only 15 legislative days before the January 15 expiration of the current continuing resolution.