Possible Outlines of USDA Budget Surface

January 20, 2000

There are reports from the Washington agricultural community that the Clinton Administration will ask Congress for more money for USDA in fiscal 2001. Although $1.3 billion is expected to be added to conservation programs, one source says there will be additional money for other farm-related programs.

Sources within the Clinton Administration say the budget will provide money to hold 2000 loan rates at 1999 levels, call for funding for a new supplemental income program for farmers and extend the milk price support program beyond 2000.

An official with a major farm organization says many of the final details of the budget must be decided by the Office of Management and Budget. But a USDA official says the costs of a new supplemental income program are expected to be $2-3 billion in 2001 and 2002. There also are indications the administration may try to pull $2 billion in loan deficiency payments from 2001 back into 2000 spending.

The budget reportedly is at OMB now, where officials are struggling with formula changes needed in the supplemental income program, says one source. There also are discussions over targeting any payments under the program to specific income classes such as small to medium sized farms.