Funding for Critical Rural Programs Delayed by Congressional Inaction

Bill awaits compromise between House and Senate funding proposals. Senate version currently calls for $800 million less

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Congress has until Sept. 30 to pass a budget and keep the government operating. Important differences between the House and Senate budget bills remain, leaving critical rural economic development, infrastructure, research, nutrition, and agriculture support programs with an uncertain future.

While the House of Representatives passed its version of the federal budget in June, the Senate did not act until mid-September. The Senate’s bill contains numerous cuts to discretionary programs at USDA compared with the House bill, as well as providing funding to complete relocation of two Washington-based research agencies to Kansas City. Differences will need to be negotiated in a joint House-Senate Conference Committee before the final budget bill is complete.

“The Senate held firm at FY2019 funding levels for most rural housing programs, which is like putting a small patch on a big hole,” said David Lipsetz, CEO of the Housing Assistance Council (HAC). “We are in a crisis, with plenty of rural places plagued by an old housing stock, rents well above incomes and capital scarce for buying and building new.”

Lipsetz said that HAC prefers the House budget to the Senate when it comes to rural housing.

“At a minimum, I wish the Senate had taken up the modest increases passed by the House,” Lipsetz said.  “Hopefully the numbers come back up when the House and Senate go to conference.”

The Senate bill contains $3.1 billion in funding for USDA Rural Development, a decrease of $800 million from the House bill. Specific rural development provisions included in the Senate bill are:

  • Housing Programs: All rural housing programs are maintained at fiscal year 2019 levels, with the exception of Rental Assistance’s $44 million increase to $1.375 billion, and a $5 million increase in housing vouchers to $32 million. The Trump Administration had previously sought elimination of rural housing funds in its budget draft.

A message from the Rural Assembly

  • Water and Waste Disposal Programs:  Water and Waste direct loans are maintained at $1.4 billion while Water and Waste grants are maintained at $549 million. These programs increase the availability of clean water and sanitary waste disposal systems to small, remote rural communities. The House budget contains nearly $200 million more in funding for these programs.
  • Rural Business Programs: The bill provides $950 million in Business and Industry loans and rejects the President’s proposal to eliminate business grants, which are increased by $3 million.  These programs promote job creation and income generation in rural areas, as previously reported by the Daily Yonder. The House bill includes $1.2 billion Business and Industry loans.
  • Community Facilities Loans and Grants:  The bill maintains the Community Facilities program at just under $3 billion.  These loans and grants can be used for any essential community facility, including hospitals, health clinics, schools, public buildings, health and safety vehicles and equipment, etc. 

Advocates for sustainable agriculture and local food systems are also calling for a funding bill based on the House version.

“While we applaud Senate appropriators for the bill’s few bright spots, chief among them the protection of mandatory conservation program funding, this bill doesn’t come close to offering the level of support warranted by the state of our farm economy,” said Juli Obudzinski, policy director at the National Sustainable Agriculture Coalition (NSAC). “We therefore urge Congress to use the House FY 2020 Agriculture Appropriations bill as their goal post when finalizing spending for the upcoming fiscal year.”

Obudzinski said the Senate bill “completely ignores the needs of sustainable, family-scale operations, and fails to fund new and promising programs – like the Local Agriculture Market Program (LAMP) – that were created with strong, bipartisan support in the 2018 Farm Bill. For the first time in recent history, Senate Appropriators zeroed out all discretionary funding for the highly successful Value Added Producer Grant program (now housed under LAMP), which was created nearly two decades ago to help farmers weather economic downturns through new market development.”

NSAC also addressed the Trump Administration’s forced relocation of Economic Research Service and National Institute of Food and Agriculture from the National Capital region to Kansas City. The Senate budget bill includes $25 million to support the Administration’s move, while the House budget bill rejects the relocation.

“We are also extremely disappointed that the Senate bill gives the green light to USDA’s contentious relocation,” of ERS and NIFA, said NSAC’s Obudzinski. “As the appropriations bills are conferenced, we urge appropriators to reject funding for this short-sighted relocation, and instead adopt the House bill’s language to prohibit USDA from selling its research agencies to the highest bidding city.”

The relocation has been highly controversial and unpopular among USDA employees. Only 19 of 280 employees for ERS have decided to make the move, according to an American Federation of Government Employees union report to Politico earlier this week. USDA is projecting significant delays in ERS research and report releases because of these staffing challenges.

As the Sept. 30 deadline approaches, and with Congress embroiled in a partisan debate over possible Presidential impeachment, most experts are predicting that Congress will decide to pass a continuing resolution and extend budget negotiations. A continuing resolution will extend the final budget deadline under current spending levels, though Congress will ultimately need to reconcile House and Senate budget differences or another government shutdown becomes more likely.

A message from the Rural Assembly

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