Farm bill, ag funding issues in limbo

WASHINGTON -- Federal Fiscal Year (FY) 2014 begins today, but the U.S. Department of Agriculture (USDA) is operating in a virtual shutdown mode until some type of FY 2014 appropriations bill that includes departmental funding and a new farm bill or another extension of the 2008 statute are passed by the U.S. House and Senate and signed by the president.  In addition to the impact of a government shutdown and farm bill expiration, the automatic reduction in federal program outlays, known as sequestration, imposed by the 2011 budget statute, takes effect today.

"USA Rice Federation understands how the absence of federal funding and a farm bill is potentially affecting our members and the federal programs that are important to our industry.  USA Rice continues to work with House and Senate offices and committees to get a farm bill authorized and get federal funding resumed as soon as possible, and will be available to assist USA Rice members during the funding shutdown and in the absence of a new farm bill or second extension of the 2008 statute," said USA Rice President and CEO Betsy Ward.

Due to the government-wide closure, the USDA main website is not available, but the department does direct readers to the White House Office of Management and Budget Office for a list of federal contingency plans and the USA.gov site.  Agencies funded through user fees, such as the Grain Inspection, Packers and Stockyards Administration and the Food Safety Inspection Service, currently continue to maintain their websites.

The Foreign Agricultural Service(FAS), Farm Service Agency (FSA), Natural Resources Conservation Service (NRSC), and Risk Management Agency(RMA) are among the many USDA and other federal agencies that are no longer operating or operating only to meet special, limited functions, such as providing food safety and other services deemed essential to public safety.

FSA and NRCS offices will close.  All farm program signup, processing and payments will stop during the shutdown.  Farm loan applications and processing will stop during the shutdown.  All of the RMA will be shut down because 100% of the agency funding is discretionary; all offices will be closed and all employees will be furloughed.

The FAS issued an announcement about how the lack of both a funding bill and the expired one-year extension of the 2008 farm bill are affecting its programs and services.  "During the shutdown, FAS will discontinue administering all market development programs...including servicing reimbursement claims," the notice says.  "With the exception of a single FAS emergency resource person... all staff working on market development programs will be furloughed until funding becomes available."  The agency also declared that with legislative authorities for its market development programs having expired, it will continue to work with market development program participating partners "on FY 2013 funded and approved activities to minimize program disruptions and negative impacts on overall market promotion efforts."  But, FAS clarified, "no FY 2014 funding can be made available" until farm bill authorities are reauthorized or extended.  Farm bill expiration also puts additional pressure on FAS operations and dramatically diminishes resources available to cover program administrative costs, the agency says.

The FSA on Tuesday  issued a summary of the sequestration policy for FY 2014 it is implementing beginning today.  "The programs, which provide interim financing for agricultural commodities to be stored after harvest and sold throughout the year when unaffected by harvest season pressure on prices, are subject to sequester reductions of 5.1 percent," the announcement says.  With commodity loan programs operating on a crop year basis and Sept. 30 marking the end of the federal fiscal year, adjustments will occur for the 2013 crop year, which include the following:  loan making for all commodities are suspended on Oct. 1 and are targeted to resume mid-October; loan repayment and servicing for all disbursed commodity loans will continue; beginning in mid-October, the 2013 crop loans, and if applicable, loan deficiency payments, will receive 5.1 percent reductions; 2013 crop loan rates are not affected.