President Joe Biden’s budget request for fiscal 2025 proposes new loan flexibilities for farmers and makes another stab at getting Congress to make permanent a $5-an-acre subsidy for cover crops while also boosting ag research and other climate-related spending.
The budget plan released Monday comes just two days after Biden signed into law a package of six of the 12 FY24 spending bills. The newly enacted legislation includes funding for USDA, FDA, EPA and several other departments, including Interior and Transportation. The remaining six bills must be passed by March 22.
The FY25 budget proposal includes $31.6 billion in new budget authority for what it called discretionary programs at USDA, up from $29.26 billion in the newly acted legislation for FY24. Discretionary programs, which include research, agency operations, farm loans, international food aid and many rural development, are funded at levels determined each year through the congressional appropriations programs.
Programs whose funding levels are set by laws like the farm bill are considered mandatory spending. Commodity programs, crop insurance, the Supplemental Nutrition Assistance Program and school meal assistance are all considered mandatory. When the estimated cost of those programs for FY25 is included, USDA’s proposed budget would come to $213.3 billion.
The USDA budget repeats a proposal included in the FY24 budget to revive the cover crop payment program offered temporarily by USDA in 2021 and 2022 using pandemic relief funding. The program would cost an estimated $825 million over 10 years, including $60 million in FY25. The temporary USDA program was modeled on state premium subsidies offered in Illinois, Indiana and Iowa.
The FY25 budget calls for five changes to USDA farm loans that would require authorization from Congress, including allowing the use of direct ownership loans to refinance debt. USDA also wants to expand the lifetime limitation on debt forgiveness from $300,000 to $600,000 and allow future loans to farmers who have gotten debt forgiveness.
USDA also says preferred lenders under USDA programs should be required to get approval from the Farm Service Agency before foreclosing on borrowers.
“Through these proposals, more producers would be able to get the financial assistance they need to keep farming and keep the farm in the family,” according to the USDA budget proposal.
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Funding for rural broadband grants and loans would get a small increase in the budget. The FY24 legislation funds the $90 million, down from the $348 million the program got in FY23. Biden is asking for $112 million in FY24, noting that the bipartisan infrastructure law earmarked $2 billion for the program.
For international food aid, the FY25 budget includes $1.8 billion for the Food for Peace program, which supplies U.S.-produced commodities to regions of the world in need of food assistance, and $243 million for the McGovern-Dole International Food for Education and Child Nutrition Program.
Food for Peace is funded at $1.62 billion under the FY24 legislation, down from $1.75 billion in FY23. The McGovern-Dole international school feeding program is funded at $240 million.
Climate change also continues to be a priority for the administration.
The FY25 budget proposes spending $6.01 billion on research, conservation assistance and other actions that are related to climate, up from the $5.04 billion spent in fiscal 2023. The request is scaled back from the $7 billion the White House had requested for FY24.
The FY25 request includes $985 million for the Natural Resources Conservation Service, a 7%, or $67 million, increase above the FY23 level, and 18% over FY20, with the goal of assisting “farmers, ranchers, and forestland owners with production goals in the face of a changing climate while conserving, maintaining, and restoring natural resources on their lands,” according to the USDA budget.
On food safety, USDA is asking for an additional $3.4 million to fund state meat and poultry inspection under a cooperative agreement, “which is especially helpful to small and very small meat and poultry processors in building their local and state markets,” the budget says.
Agriculture Secretary Tom Vilsack said his department's proposed budget "honors this commitment and enhances the opportunities available for millions of Americans, including in rural communities. Whether it’s the pay raises our firefighters deserve for their brave service, making sure infants and kids have access to nutritious foods, or investing in rural prosperity through housing and business capital, the Biden-Harris Administration will continue to ensure people can find success in the places they call home."
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