The Senate passed their version of the 2012 Farm Bill on June 21, 2012 (summaries available here, here, and here). On July 5 Representative Frank Lucas, Chairman of the House of Representatives Committee on Agriculture released a draft of the Federal Agriculture Reform and Risk Management Act of 2012 which was passed by the House Ag Committee on July 11, 2012 (summary of draft available here).
Both the Senate and House Committee versions of the 2012 Farm Bill have been scored by the Congressional Budget Office (CBO) to achieve significant savings – more than $23 billion for the Senate version and more than $35 billion for the House Committee bill over the 10 fiscal years from 2013 through 2022.
It is important to point out that the savings or additional spending levels presented and discussed in this post are based on CBO projections for the Senate and House versions of the 2012 Farm Bill relative to their March 2012 baseline projections for existing programs.
In other words, they represent changes in spending relative to if the 2008 Farm Bill programs were to continue unmodified through the next 10 fiscal years (2013-2022) based on baseline projections for commodity price levels, supply, and demand in these future periods.
Projected Changes in Spending Over 2013-2022
The aggregate savings are largely reached in both pieces of legislation through major cuts and modifications to programs in the Commodity, Conservation, and Nutrition Titles. All other Titles in both bills have been scored as having increased spending levels with additional spending the most notable in the Crop Insurance Title.
Figure 1 illustrates the projected savings or additional spending across various titles in both the Senate and House versions.
Projected savings in the Commodity, Nutrition, and Conservation Titles total nearly $30 billion in the Senate bill and $45.7 billion in the House draft through FY 2022. Spending on programs in the Crop Insurance Title is projected to be more than $5 billion above the baseline in the Senate bill and $9.5 billion above baseline in the House Committee bill over the next 10 fiscal years. Changes in other areas, which include the Rural Development, Research and Extension, Forestry, Energy, Horticulture, and Miscellaneous Titles, are projected to result in $1.6 and $1.1 billion in additional spending relative to the baseline for the Senate and House versions, respectively.
Allocation of Spending Cuts Across the Commodity, Nutrition, and Conservation Titles