BUDGET DEAL TO HAVE LONG-TERM IMPACT ON AGRICULTURE Although the impact is yet to be seen, spending reductions are on the

horizon fo r the agriculture sector as Congress moves forward with implementation of the re cently passed Budget Control Act of 2011. It is expected the deal will result i n at least $1.2 trillion in debt limit increases, as well as $917 billion in spe nding reductions slated to be instituted over the next decade. Although the fin al deal focused on discretionary saving and, for the time being, spared mandator y spending, the jury is still out regarding The bill establishes a Joint Select Committee on Deficit Reduction made up of 12 members of Congress, equally divided with three House Republicans, three House Democrats, three Senate Republicans and three Senate Democrats. Members of this Gang of Twelve are slated to be named in mid-August and will be tasked with reduc ing the deficit by at least $1.5 trillion. On, or around, September 20, 2011 th e Joint Committee is to hold its first meeting, with each Senate and House commi ttee having the opportunity to forward recommendations for consideration on Octo ber 14, 2011. No later than November 23, 2011 the Joint Committee must vote on a report contai ning a detailed statement of the findings, conclusions as well as the Congressio nal Budget Office (CBO) estimate. A simple majority is required for passage and any bill reported out of the Committee will receive expedited consideration in both the Senate and the House to be voted on no later than December 23, 2011. In the event the Joint Committee process fails to result in savings, the full $1 .2 trillion would be sequestered from defense and non-defense spending in equal dollar amounts. As such, it will impact enough programs that enjoy support in b oth parties that there is an incentive for the Gang of Twelve to succeed in their assigned mission. Under either scenario agriculture spending will not escape unscathed. There hav e been no assurances that agriculture (or any other sector) will be spared from future reductions and all eyes will be on the machinations of the Joint Committe e. As reported by the Red River Farm Network and other media outlets, House Agr iculture Committee Ranking Member Collin Peterson (D MN) does not hold out hope that the Joint Committee will include members from the House who have a connecti on to agriculture. Furthermore, Senate Budget Committee Chairman Kent Conrad (D ND) has stated that the Budget Control Act holds to potential to rewrite rules pertaining to commodities, land stewardship and next generation biofuels. Copyright 2011 RDL & Associates, LLC. All rights reserved.