SENATE'S INFLATION REDUCTION ACT INCLUDES ADDITIONAL $40 BILLION FOR AGRICULTURE/RURAL PROGRAMS
Aug. 8, 2022
The Senate on Sunday passed the Inflation Reduction Act along party lines - a massive climate, tax and healthcare bill packing a nearly $40 billion agriculture title.
What's new: Senate Democrats made a few last-minute ag-facing additions to the bill.
First, they added $4 billion for drought resilience, which would be directed to the Bureau of Reclamation.
Democrats also snuck in $3.1 billion in relief funds for "distressed" borrowers of USDA loans and $2.2 billion to administer aid to farmers who have experienced discrimination from USDA before Jan. 1, 2021.
What's old: The bill would dump $20 billion into various existing oversubscribed USDA agriculture programs to reduce environmental impact. This includes:
- $8.45 billion for the Environmental Quality Incentives Program (EQIP)
- $6.75 billion for the Regional Conservation Partnership Program (RCPP)
- $3.25 billion for the Conservation Stewardship Program (CSP)
- $1.4 billion for the Agricultural Conservation Easement Program (ACEP)
It also seeks to bolster rural clean energy and economic growth with a $14 billion spend in rural development. This includes:
- $9.7 billion in grants and loans to dole out to rural electric cooperatives for renewable energy projects
- $1.965 billion to the Rural Energy for America Program (REAP)
- $1 billion for forgivable Section 317 loans for electric generation from renewable energy resources for resale to rural and nonrural residents
- A provision for direct pay credits for rural electric cooperatives investing in renewables, which would bring the tax-exempt entities into parity with for-profit counterparts that have reaped renewable energy tax credits for years
- $500 million for biofuels infrastructure
And, the bill funds $5 billion for fighting wildfires and boosting carbon sequestration projects via climate-smart forestry.
Heard from the lobby: Jim Mulhern, the CEO of the National Milk Producers Federation, said the bill is a "game-changer" and "will better position dairy farmers to effectively implement the dairy sector's Net Zero Initiative and fulfill its 2050 environmental stewardship goals." A number of ag groups also praised the biofuels provisions.
However, the American Farm Bureau Federation was opposed to the bill, with president Zippy Duvall saying it "has serious concerns about the proposed increase in taxes on American businesses at a time when the country is entering a recession."