The Farm Bill has been coming up once again in political discourse this year, mainly due to the upcoming expirations of the Farm Bill extension on September 30, and December 31, 2024. As such, interested parties are discussing and bringing new ideas to the table for the upcoming bill. But what all is in the Farm Bill, and how is it created and funded?
What Makes up the Farm Bill?
The Farm Bill is what is known as an omnibus multiyear law that covers a large group of different agricultural and food programs. Omnibus bills are large bills typically made up of several smaller bills, and multiyear refers to the requirement to repass the bill again, which in the Farm Bill’s case is usually around every five years.
The Omnibus nature of the bill often combines different supporting groups, including groups with conflicting values and interests to help support the bill as a whole.The different regulations that make up the farm bill are currently broken into twelve titles. Each title focuses on a different aspect, such as Energy, Crop Insurance, or Nutrition. The version of the Farm Bill passed from 2018 currently takes up around 530 pages to cover all the information contained within the twelve titles.
The Farm Bill is what is known as an omnibus multiyear law that covers a large group of different agricultural and food programs.
A Short History of Crop Insurance in the Farm Bill
Omnibus bills are large bills typically made up of several smaller bills, and multiyear refers to the requirement to repass the bill again, which in the Farm Bill’s case is usually around every five years. The Omnibus nature of the bill often combines different supporting groups, including groups with conflicting values and interests to help support the bill as a whole.
The different regulations that make up the farm bill are currently broken into twelve titles. Each title focuses on a different aspect, such as Energy, Crop Insurance, or Nutrition. The version of the Farm Bill passed from 2018 currently takes up around 530 pages to cover all the information contained within the twelve titles.
How Does The Farm Bill Get Created and Updated?
The path to a new and updated farm bill is a highly convoluted process that can be difficult to finish in a timely fashion, as political parties often clash on different pieces of the legislation. It typically starts with hearings where members of Congress listen to inputs from the public about their desires for the new bill. Once that is complete, the House and the Senate Agriculture Committees each draft, discuss, and pass their own version of the bill. Next, the full body of the House of Representatives and the Senate meet to discuss and pass their own versions.
Once both the House and Senate have passed their version, they are both sent to a committee of members made from both houses to combine the bills into a single package. Once done, it is sent back to the House and the Senate to discuss and pass again. Finally, once both sides have agreed on and passed a bill, it is sent to the president for a final signature.
Once passed there, the new Farm Bill will be sent to the appropriations phase, where money is set aside in the federal budget to fund the programs in the Farm Bill. For a phenomenal in-depth explanation of both the congressional process, and the appropriations process, make sure to visit The National Sustainable Agriculture Coalition’s page discussing it!
Where Does the Money Go?
Budgeting for the Farm Bill is fairly different from the average household budget. To start, federal spending for the bill is divided into two sections: mandatory and discretionary spending. Mandatory funding typically takes the lion’s share of debates for the bill’s spending, and is based on a multiyear budget estimate known as a baseline. This mandatory funding also does not have to worry about annual appropriation decisions by Congress, and are not constrained by annual limits. These funding levels can be modified by Congress through newly created legislation however.
Meanwhile, discretionary funding can be funded up to the level implemented by legislation. That level can be changed each year, but once expenditures reach the level appropriated for the year for those programs, they cannot spend additional funds unless Congress appropriates them more money.
For more details on the specifics of how this is completed, stop by the Congressional Budget Office’s page describing this process.
The CRS (Congressional Research Service) have a fantastic short summary document that includes some very helpful information in regards to the Farm Bill and its budgeting. The first chart shows how the baseline budgeting went for the 2018 bill, and what the future appears to look like. In the chart to the right, we can see the baseline bill estimates from 2018 for fiscal year 2019- FY 2028. Adjacent to that, we can see how those baseline estimates changed as of February 2024, where the budget is now estimating costs from Fiscal year 2025 to FY 2034.
Looking at this chart, we can see that there were some very heavy changes in funding for several different programs. Most notably, the Nutrition section jumped by around 72%, and Crop Insurance had a nearly 60% increase (59%). Most of the other programs had little change, with some even going down a few million in estimated cost, such as the Conservation, Miscellaneous, and Energy titles. Over all, the estimated 2025-2034 budget increased by around 61%.
The CRS (Congressional Research Service) have a fantastic short summary document that includes some very helpful information in regards to the Farm Bill and its budgeting. The first chart shows how the baseline budgeting went for the 2018 bill, and what the future appears to look like. In the chart below, we can see the baseline bill estimates from 2018 for fiscal year 2019- FY 2028. Adjacent to that, we can see how those baseline estimates changed as of February 2024, where the budget is now estimating costs from Fiscal year 2025 to FY 2034.
Looking at this chart, we can see that there were some very heavy changes in funding for several different programs. Most notably, the Nutrition section jumped by around 72%, and Crop Insurance had a nearly 60% increase (59%). Most of the other programs had little change, with some even going down a few million in estimated cost, such as the Conservation, Miscellaneous, and Energy titles. Over all, the estimated 2025-2034 budget increased by around 61%.
Additionally, while we can see which titles are estimated to be the most expensive based on the first chart, this additional chart from the CRS also puts into perspective where most of the estimated spending will be. This chart shows that the Nutrition title contains nearly 82% of Farm Bill baseline spending. The Crop Insurance title is just under 9%, and the rest of the baseline spending combined is just over 9%.
Aside from the mandatory and discretionary spending, there is also supplemental spending. Supplemental is not considered in the baseline, but as there has been quite a bit of additional supplemental spending in recent years, it is important to keep this extra spending in mind. To see some examples of the supplemental spending from financial year 2018 up to FY 2023, we can gather more information from the CRS farm bill primer once again. One notable expenditure contained over 30 billion of supplemental pandemic assistance to farms, and over 60 billion for the nutrition title in financial year 2020 to 2022. Also of note, is that Congress has authorized more than 19 billion of ad hoc disaster assistance for agricultural losses from 2018 to February of 2024.
Aside from the mandatory and discretionary spending, there is also supplemental spending. Supplemental is not considered in the baseline, but as there has been quite a bit of additional supplemental spending in recent years, it is important to keep this extra spending in mind. To see some examples of the supplemental spending from financial year 2018 up to FY 2023, we can gather more information from the CRS farm bill primer once again. Aside from supplemental outlay increases, a notable expenditure was over 30 billion of supplemental pandemic assistance to farms, and over 60 billion for the nutrition title in Financial year 2020 to 2022. Also of note, is that Congress has authorized more than 19 billion of ad hoc disaster assistance for agricultural losses.
The Farm Bill can be pretty complicated, and today we just scratched the surface of what all is contained within it. For more in depth information about this incredibly important piece of legislation, check our resources and additional reading links below!