The massive $1.15-trillion FY2016 omnibus spending package - complete with an array of policy riders - was unveiled by congressional leadership late on the evening of December 15.  The cost is parsed over 10 years.

 

The House quickly announced it will vote on a related federal tax extenders package Thursday, December 17, then move to the omnibus spending bill on Friday, December 18. It will merge the two bills into a single legislative package and send it to the Senate for a single, final vote in hopes of getting out of town by their agreed-to recess date.

 

President Obama signaled he'll sign both the omnibus package and the related tax extenders bill.  His statement of administration policy said "The Administration appreciates the bipartisan effort to provide full-year appropriations legislation for [fiscal] 2016 largely free of new unrelated ideological riders."

 

Politically, the tax extenders package (see story below) will have an easier time on the floor of the House than the omnibus spending bill.  While conservative GOPers see the tax package as pro-business and pro-jobs, they're disgruntled over policy riders that failed to make the cut in spending negotiations, particularly a demand that Syrian and Iraqi refugee resettlement to the U.S. be suspended until vetting procedures are worked out.

 

The spending package carries all 12 department/agency spending bills for the remainder of FY2016 - through midnight, September 30 - and several were reworked from earlier approved version because the FY2016 budget resolution allocated an additional $80 billion in discretionary spending for both domestic and military programs.  House rules require 72 hours between bill introduction and floor action, therefore the House and Senate had to approve a third short-term continuing resolution (CR) keeping the federal government open through December 22.

 

A House summary of the bill can be found here.

 

Spending - The agriculture, rural development, FDA and related agencies bill carries a $141-billion price tag, $26 billion less than President Obama wanted and $6.4 billion less than FY2015.  Of the total, $21.75 billion is discretionary spending, $1.1 billion more than last fiscal year.

 

FDA gets $2.7 billion in discretionary spending, $132 million more than last year, and when all FDA funding is added, the agency's total budget hits nearly $4.7 billion, $238 more than FY2015.  FDA got all it asked for in the food safety arena - a $104.5-million increase - most of it dedicated to implementation of the Food Safety Modernization Act (FSMA). 

 

EPA's budget was flat, held to last year's spending authority of $8.1 billion, $451 million less than what President Obama had requested, but higher than either House or Senate appropriations committee previously approved.  Likewise, the Commodity Futures Trading Commission (CFTC) receives $250 million, equal to FY2015 funding.

 

At USDA, the Food Safety & Inspection Service (FSIS) gets $1.015 billion, a $4-million increase, but may not spend any money to inspect horses moving to federally inspected slaughter facilities.  The Agricultural Research Service (ARS) received $2.47 billion to support USDA research, as well as research at land grant and non-land grant universities, and the extension service received $476 million of that total.  The Animal & Plant Health Inspection Service (APHIS) is funded at $886 million, $30 million more than the President's request and $15 million more than last year.  Most of the increase goes to fighting avian influenza and other plant and animal disease prevention and mitigation.  The Natural Resources Conservation Service (NRCS) gets $851 million, nearly $5 million more than a year ago, rejecting President Obama's request to reduce conservation technical assistance.  The Farm Service Agency (FSA) gets $1.51 billion to fund its various programs, with language included prohibiting USDA from closing any FSA county offices, while funding implementation of the 2014 Farm Bill.

 

The bill provides $345 million -- $43 million more than last year - for construction, operation and maintenance of flood control, navigation and ecosystem restoration projects along the Mississippi River and tributaries from Cairo, IL, to the mouth of the river.   Also included in the bill is $100 million for "western drought response," instructing the Interior Department to spend it on efforts to raise water levels as quickly as possible.

 

Policy Riders - Up to the last minute, it was a political guessing game as to which of over 100 policy riders made it into the omnibus spending package.  Agriculture scored some wins and some losses.

 

In the EPA section of the omnibus, language to force a rewrite of EPA's "waters of the U.S. (WOTUS)" rule failed to make the final package. The full House has approved language requiring the agency to withdraw the rule and start over with greater stakeholder input.  The WOTUS language was a major sticking point in the final days of negotiations between Congress and the White House, not just on spending, but also on the tax extenders bill.  Supporters of the language thought they'd won given that federal courts have blocked implementation of the WOTUS rule.

 

Language blocking EPA from instituting $139 million in "new program spending" - the lowest level since 2008 - did make the cut.   Also in this section is language requiring the President to report to Congress on his climate change spending. 

 

There's language in the omnibus prohibiting FDA from enforcing provisions of FSMA involving regulating the distribution and sale of dried, spent grain byproducts left over from distilling.  Distillers fear they won't be able to sell or give away distillers' byproducts as animal feed without incurring new costs of compliance under the new food safety law.

 

Also included in the final package is language repealing country-of-origin labeling (COOL) for meat and chicken, a law held anti-competitive three separate times by the World Trade Organization (WTO).  The House approved a repeal bill earlier this year, but a showdown between Senate Republicans and Democrats over full repeal versus "voluntary COOL" stymied progress in the chamber.  Sen. Pat Roberts (R, KS), chair of the Agriculture Committee, prevailed and saw his full repeal strategy included in the spending bill, avoiding a trade war with Canada and Mexico which were set to slap $1 billion in retaliatory tariffs on a variety of U.S. exports.  House Agriculture Committee Chair Mike Conaway (R, TX) praised the language, commended Roberts, and said, "By including the language, we are back in compliance with our WTO obligations, avoid more than $1 billion in retaliation...and prevent damage to our relationships with two of our top trading partners."

 

The Senate language on COOL repeal doesn't go as far as the House-approved bill, and Roberts pledged further action in the Senate to fully repeal the COOL law.  While Canadian ag and trade officials this week were optimistic the action would lead to an end to the trade dispute, Laurence MacAulay, ag minister, said he was "cautiously optimistic" and said Canada will not relent on retaliation actions until President Obama signs the spending package.

 

A broad industry coalition pushing for federal preemption of state and local laws mandating labeling of foods containing genetically engineered (GE) ingredients failed to get scaled-back language calling for a two-year preemption into the bill.  The coalition had sought the protection given Vermont's mandatory labeling law goes into effect in July, 2016, and companies must start to make distribution and labeling decisions in January.  Said the coalition, after warning of increased foods due to a patchwork of state labeling laws, "While the House worked in bipartisan fashion to pass the Safe & Accurate Food Labeling Act in July with the support of 45 Democrats, action stalled in the U.S. Senate.  The Coalition calls on members of Congress to work to find agreement and pass legislation to address this issue immediately when they return in January." The group's biggest adversary, the Environmental Working Group, quickly claimed credit for rejection of the preemption language.

 

Also included is language running counter to the labeling coalition efforts in that it instructs FDA to spend up to $150,000 to develop a "labeling guideline" for the recently approved GE Atlantic salmon, even though the agency has already said it sees no reason to label the fish, an opinion shared by the Center for Science in the Public Interest (CSPI).  The language doesn't mandate labeling, but that the agency develop a guideline before the fish can be commercialized, a development not expected for two years.  The language was brought by Sen. Lisa Murkowski (R, AK), whose fishing industry fears product competition, even though Alaskan "wild caught" Pacific salmon is sold as a premium product and the GE salmon is of the Atlantic variety. The U.S. currently imports 94% of the Atlantic salmon bought by Americans, primarily from Scotland, Norway, Chile and Canada.

 

Both the Department of Health & Human Services (HHS) and USDA were warned they need to issue final dietary guidelines that are based on science and not on "sustainability" or other non-nutrition issues. The bill withholds any money to release the guidelines if the departments can't show they used a science-based system for finalizing the document.  Further, USDA and HHS must contract with the National Academy of Medicine (NAM) to conduct a review study of the process by which the guidelines advisory committee is named, as well as the process the committee goes through in making its recommendations. 

 

The American Seed Trade Assn. (ASTA) was successful in getting language blocking a second extension of patent protection for Marshall rye grass, and cotton producers saw a successful resurrection of marketing loan commodity certificates, despite strong opposition by Sen. Charles Grassley (R, IA) who says the certificates are just a way around new payment limitations included in the 2014 Farm Bill.

 

Also made permanent are the enhanced child tax credit, the earned income tax credit, the deduction for state and local general sales taxes, the corporate research and development (R&D) tax credit, and a provision allowing for pass-through of interest-related dividends and short-term capital gains from regulated investment companies to foreign investors.