USDA Budget Would Rise 11% on Food-Stamp Spending

U.S. Department of Agriculture spending would increase 11 percent to $144 billion in fiscal 2012 as the number of people receiving nutrition assistance reaches records and food-safety spending rises, the government said.

The Supplemental Nutrition Assistance Program, or food stamps, will cost $85.2 billion in the year starting Oct. 1, up 15 percent from levels in 2010, the last time agencies had an enacted budget, according to the spending plan President Barack Obama sent to Congress today. A record 43.6 million people, more than one of every eight Americans, received food stamps in November, as the jobless rate stayed near a 27-year high, the USDA said earlier this month.

“There’s growth in the program like there is in unemployment, because of the recession and continued economic weakness,” said James Weill, the president of the Washington- based Food Research and Action Center.

The USDA spending plan is part of the overall $3.7 trillion budget that calls for this year’s deficit to reach $1.6 trillion. Some Republicans have been critical of the plan as insufficient to reduce federal debt. The USDA projections are based on the 2008 farm bill that authorized agriculture funding for a five-year period.

Reduced Subsidies

Agricultural subsidies would fall 14 percent with higher crop prices and as the administration tries to limit payments to wealthy farmers, according to the Obama proposal.

Agriculture Secretary Tom Vilsack said direct payments, regardless of crop prices, would be restricted to growers with farm income of less than $500,000, or non-farm income of less than $250,000, reiterating a proposal from a year ago.

About $116.4 billion of the USDA budget will go to mandatory programs that have multiyear spending formulas set by law, a 13 percent increase from fiscal year 2010. Total budget authority for discretionary programs, which require annual appropriations, would fall 12 percent to $23.9 billion. The budget is subject to approval by Congress.

“The budget has to reflect the reality of deficit reduction,” Vilsack told reporters at a briefing in Washingon. “The president has been clear about it, the people have been clear. There’s an expectation when times are tough, folks tighten the belt.”

Under the president’s plan, funding for the Commodity Credit Corp., which makes farm-subsidy payments, would drop to $10.8 billion from $12.5 billion.

Food Safety

The USDA’s Food Safety and Inspection Service would receive $1.1 billion to monitor meat, egg and dairy facilities, down $8 million from 2010.

The cuts reflect “efficiencies that can be obtained” and should not affect food safety, Vilsack said.

Obama last month signed a $1.4 billion food-safety bill, with most of the funding going to the Food and Drug Administration, which is responsible for overseeing 80 percent of the U.S. food supply.

USDA spending in fiscal year 2010 totaled $129.5 billion.

To contact the reporters on this story: William McQuillen in Washington at bmcquillen@bloomberg.net; Alan Bjerga in Washington at abjerga@bloomberg.net.

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.

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