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Hill of Beans

Jun 30, 2017

By Tony Eberhard, IDFA Vice President of Legislative Affairs

Welcome to “Hill of Beans,” a periodic update by Tony Eberhard about the association’s work in the U.S. House of Representatives and the U.S. Senate to advance dairy industry priorities. After working on the Hill for various members of Congress and senators since 2001, Eberhard gives IDFA readers a former Hill staffer’s take on what is going on and how it affects our priorities. 

“There is a lot of work being done in the House and Senate that never makes the headlines but affects members’ bottom lines, and I’m hoping these updates will prove useful to you and your organization,” Eberhard said. “I’m titling these updates ‘Hill of Beans’ because to many in national media this information might not amount to much, but to our industry’s agenda in Congress, it is critical.” Read the inaugural update below.

Balancing Act

While not currently being debated on the House or Senate floors, the congressional budget resolution for fiscal year (FY) 2018 is the subject of intense discussion. Neither the House or the Senate have passed their versions of the budget, but the House’s budget product is likely to be unveiled soon after the July 4th holiday. The outcome of the deliberations on the congressional budget could have a big impact on our ability to make progress on IDFA’s legislative priorities.

Pay Attention to the Reconciliation Instructions

Now, I know an easy way to put folks to sleep is to talk about the congressional budget process. It doesn’t help that budget conversations are spoken in a different language, with terms like the “302(a)” and “reconciliation instructions,” which seem designed to confuse. But, the budget process is worth paying attention to, and once you get past the lingo, you’ll find that it really isn’t that complicated.  One term on the minds of several committee chairmen in the House that is worth paying attention to is reconciliation instructions.

Before we get into the ongoing debate on what reconciliation instructions should be included in the budget, let’s take a quick look at what reconciliation instructions are by going through an example. Say both the House and Senate pass a budget resolution with reconciliation instructions telling four different committees to come up with $1 billion each in savings from the federal programs in their jurisdictions. Those committees would look at the programs they’re responsible for and figure out how to produce $1 billion in savings. The committees then would submit their changes in the form of legislative text to the budget committee in their respective chamber. The budget committees would compile these changes into one bill, which would receive expedited floor consideration and could be passed with only a majority of votes in the Senate. Importantly, though congressional budgets cannot change federal programs as they aren’t signed by the President, reconciliation bills are, in fact, changes to federal law that once signed by the President are the law of the land.

In other words, a reconciliation process is a live fire exercise that affects actual programs. That’s why there is such a big fight in the House right now about which committees will have to find certain amounts of savings under the FY2018 budget resolution’s reconciliation instructions.

Fate of Farm Bill on the Line

House Budget Committee Chairwoman Diane Black (R-TN) is reportedly asking for $200 billion in savings from various committees, including the House Agriculture Committee.  Which chairmen must come up with what amount of money makes a big difference to those committees that have to generate large sums.  For instance, it may prove difficult to pass a farm bill if the agriculture committees have to make program cuts in a FY2018 reconciliation bill. 

House Agriculture Committee Chairman Mike Conaway (R-TX) and other ag state members of Congress have pointed out that the current farm bill has saved about $100 billion while other federal programs haven’t made similar spending reduction contributions. If a reconciliation bill makes passing a farm bill unlikely, it means that IDFA loses an important opportunity to improve forward contracting and nutrition programs. 

It’s true that even if Congress passes a budget resolution that includes reconciliation instructions, there is no requirement for Congress to actually pass a reconciliation bill. After all, a reconciliation bill is an optional vehicle for expediting legislation that Congress can use or not use. However, the reconciliation instructions in the FY2018 budget resolution are likely to pass because they will serve as the vehicle for something else that concerns every American: tax reform. Without a reconciliation bill, tax reform is unlikely as Republicans will likely need the procedural protections that it provides.

It’s also important to remember that reconciliation can facilitate tax reform without requiring savings from committees like the House Agriculture Committee.  As of today, it appears that Chairman Conaway has found a workable agreement with Chairwoman Black, which is a positive sign. This is one balancing act to which we will continue to pay special attention.

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