Johanns outlines 2008 agricultural budget

Agriculture Secretary Mike Johanns has released details of President Bush's FY 2008 U.S. Department of Agriculture budget, which meets the Department's most important priorities, while exercising fiscal discipline to meet the President's goal to balance the budget.

"The President's agriculture budget provides important resources that are necessary to promote economic opportunities and to preserve our commitment to our farmers, ranchers, rural citizens, and families in need," said Johanns. "This budget aims to enhance our country's vibrant ag economy, advance renewable energy, protect America's food supply, improve nutrition and health, and conserve our natural resources."

The 2008 budget reflects the President's priorities to encourage economic growth and increase our security. It also reflects the President's goal to keep spending under control and achieve a balanced budget.

On Jan. 31, the Administration announced a comprehensive set of farm bill proposals for strengthening the farm economy and rural America. Beginning in 2008, the budget incorporates a $500 million increase each year in the Commodity Credit Corporation (CCC) estimates to accommodate the cost of new farm bill proposals to be allocated among the various titles of the bill.

Total USDA expenditures are estimated at about $89 billion in 2008, which is approximately the same level as 2007. Roughly 75 percent of expenditures, or $67 billion in 2008, will be for mandatory programs that provide services required by law, which include many of the nutrition assistance, commodity, export promotion and conservation programs.

USDA's discretionary programs account for the remaining 25 percent of expenditures or $22 billion in 2008, which is approximately the same level as 2007. Discretionary programs include the Women, Infants and Children (WIC) program; rural development loans and grants; research and education; soil and water conservation technical assistance; management of National Forests and domestic marketing assistance.

Highlights of the FY 2008 budget include:

• Food and Agriculture Defense Initiative. The budget proposes $325 million for on-going programs to support the multi-agency Food and Agriculture Defense Initiative. This proposal represents a $148 million increase for USDA to continue improving the safety and security of America's food supply and agriculture. Funding increases include: $36 million to strengthen responses to food emergencies, related training, and research for food defense; $35 million for research to improve animal vaccines and facilitate rapid response to agricultural threats; and $77 million to enhance surveillance and monitoring of pest and disease threats and to improve response capabilities, and other efforts.

In addition, the budget includes an increase of $16 million to design a new Consolidated Poultry Research Facility in Athens, Ga., which will be the Department's premier center for conducting critical research on exotic and emerging avian diseases that could have devastating effects on animal and human health.

• Avian Influenza. USDA continues to be a full partner in a government-wide effort to prepare the country for the potential of an influenza pandemic as well as the worldwide effort to stop the spread of the H5N1 virus at its source — overseas. In 2006 and 2007, USDA significantly increased its efforts to prepare for a potential influenza pandemic, utilizing the $91 million in emergency supplemental funding. These funds have been used for international efforts; domestic surveillance of poultry and migratory birds; diagnostics; emergency preparedness and response; and research. The 2008 budget requests funds to continue these efforts.

The 2008 budget includes $82 million to fund on-going avian influenza programs for both highly pathogenic and low pathogenic forms of the disease, including supporting domestic surveillance efforts, improving preparedness and response capabilities to help quickly eradicate a domestic detection, and stemming the spread of H5N1 avian influenza overseas. Excluding one-time emergency supplemental funding, this is a $32 million increase in avian influenza efforts over 2007.

• Energy Initiatives. The 2008 budget continues to provide funds to support the development of renewable energy resources and commercialization activities, designed to help meet the President's goal of reducing gasoline usage by 20 percent by 2017. This budget includes $397 million for energy projects, an increase of $161 million over 2007. Of this increase, $132 million is for Rural Development renewable energy investments through guaranteed loans and grants, and other efforts. The remaining increase of $29 million supports research and development activities to enhance bioenergy feedstocks and improve conversion technologies for cellulosic ethanol. It does not, however, include the $1.6 billion request for new funding cited in the Administration's 2007 farm bill proposals.

• Farm Support Programs. The Department's farm support programs receive mandatory funds from CCC. Under current law, CCC expenditures are estimated to decline from $20.2 billion in 2005 and 2006 to $13 billion in 2007 and $12 billion in 2008. The decline in net outlays from 2006 has been the result of higher commodity prices largely due to growth in ethanol production.

• Domestic Nutrition Assistance Participation and Funding. The budget fully funds the expected requirements for USDA's three major nutrition assistance programs: Food Stamps, Child Nutrition and WIC, which combined account for over $56 billion.

Food Stamp participation is projected to decline from 26.3 million in 2007 to 26.2 million in 2008. The budget of $37 billion includes resources to fully fund estimated Food Stamp participation. The budget also provides a $3 billion contingency fund should actual costs exceed the estimated level.

School Lunch participation is estimated to reach 31.5 million children each day. The budget provides a $632 million increase in Child Nutrition Programs to accommodate this need for a total budget of $13.9 billion.

WIC participation will grow to 8.3 million participants per month. The budget proposes $5.5 billion to support this level and includes a $200 million contingency fund, should costs increase beyond current estimates.

• Farm Bill Conservation Program Funding and Program Enrollment. USDA fosters environmental stewardship through conservation programs supported with CCC funding. The 2008 budget includes nearly $4 billion to provide conservation financial and technical assistance on a cumulative total of 215 million acres.

In dollar terms, the largest of these programs is the Conservation Reserve Program, estimated at just over $2 billion in 2008. Funding for the Environmental Quality Incentives Program (EQIP) will be maintained at $1 billion in 2008. The budget proposes over $455 million for the Wetlands Reserve Program (WRP), an increase of $191 million, or nearly 72 percent over 2007. The projected WRP enrollment for 2008 would be the largest ever, involving up to 250,000 acres, and will bring the total acreage enrolled in the program to 2,275,000 acres, the maximum level authorized by the 2002 Farm Bill. Funding for the Conservation Security Program in 2008 is estimated to be $316 million, an increase of $57 million, to continue support to the more than 19,000 contracts signed in prior years.

The 2008 budget also proposes $825 million in discretionary funding for on-going conservation work. This supports programs providing high quality technical assistance to farmers and ranchers to address their most serious natural resource concerns.

• Healthy Forests. The budget continues implementation of the President's Healthy Forests Initiative to mitigate the threat of catastrophic wildfires. Resources proposed in the budget will reduce hazardous fuels on an estimated 2.95 million acres of land, an increase of 50,000 acres over the acres expected to be treated in 2007. By the end of FY 2008, federal agencies, including the Department of the Interior, will have treated hazardous fuels and accomplished landscape restoration activities on more than 26 million acres of the nation's forests and wooded rangelands since the beginning of FY 2001.

The budget for the Forest Service also provides sufficient wildland fire resources to protect communities and natural resources, and provides for sustainable forests and communities through full funding of the Northwest Forest Plan and continuation of the Payments to States Program.

• Food Safety. The budget requests a record level of funding of $1.1 billion for the Food Safety and Inspection Service. This funding will ensure the demand for inspection is met and will allow us to build on our success in improving the safety of the food supply. It will also strengthen the Food Emergency Response Network. This national network of food safety laboratories increases the speed with which we can detect and respond to outbreaks of foodborne illness.

• Rural Development. The 2008 budget includes nearly $15 billion in program level funding for rural development programs. The 2008 budget proposes to align USDA's single-family housing program with other similar Federal programs by shifting from direct to guaranteed loans. Due to the success of guaranteed single-family loans in meeting the needs of rural citizens, the budget includes $4.8 billion in guaranteed loans for single-family housing, an increase of $1.7 billion over 2007, and no funding for direct single-family loans.

Further, the 2008 budget includes $567 million for the rural rental assistance payment program to protect the rents of low-income tenants of its multi-family housing portfolio. The budget also includes $1.3 billion for financial and technical assistance for rural business and $4.8 billion for electric and telecommunications loans.

• Research. The budget requests $2.4 billion to support the USDA research program. For 2008, the budget continues to emphasize the use of competitive grants through the National Research Initiative and the Hatch and McIntire-Stennis programs. As part of USDA's efforts to increase emphasis on competitive grants, over $400 million of Congressional earmarks are not funded.

The budget increases funding for high priority bioenergy research aimed at improving the efficiency of converting cellulose to biofuels. Research is also an important component in key budget initiatives for avian influenza, food and agriculture defense, and emerging diseases in crops and livestock.

Finally, the budget also includes the funding required to conduct the 2007 Census of Agriculture.

Additional information regarding the FY 2008 budget proposal is available on the web at .

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