Monday, March 21, 2011

It's Complicated - The Fiscal Year 2012 Budget Debate, CHIMPS and the 2012 Farm Bill

In the U.S. Congress, the acronym "CHIMPS" stand for "Changes In Mandatory Program Spending;" changes that happen when an Appropriations Committee makes cuts in a spending bill to mandatory programs whose spending amounts are authorized under another piece of legislation.  Such a CHIMP can be viewed as usurping the jurisdictional authority of the committee(s) drafting the original piece of authorizing legislation.  Although CHIMPS normally just impact spending for the particular fiscal year in which the CHIMP is enacted, CHIMPS can have serious long-term ramifications in certain situations.  One such situation is agricultural spending related to Fiscal Year (FY) 2012, since FY 2012 is the year that the Congressional Budget Office (CBO), Office of Management and Budget (OMB), and Senate and House Budget Committees establish the baseline used to set USDA funding for the next 10 years (that is, through FY 2022).   They use FY 2012 to establish the baseline since 2012 is the year in which many agriculture programs' authorizations expire.

So, it was with the spectre of CHIMPS in mind that minority staff (Craig Jagger, Minority Economist) for the House Committee on Agriculture last Friday (March 18) released a paper describing the potential impact of CHIMPS during the FY 2012 budget cycle could have on agricultural spending for years to come, potentially undermining the amounts of funding allocated to agricultural programs in the next Farm Bill (here is a link to the Agriculture Committee CHIMP paper, by way of

Using the USDA NRCS Environmental Quality Incentives Program (EQIP) as an example, the paper explains that a hypothetical $342 million cut (or CHIMP) from the FY 2012 budget would translate over the next 10 fiscal years after into an accumulated 11-year cut of $3.76 billion from the program.  The paper explains that "substantial reductions in funding for the Ag Committee’s programs through CHIMPS have been a fixture of Ag Appropriations bills for many years," and that "CHIMPS reductions on other Ag Committee programs would cause even larger reductions to the Farm Bill baseline."

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