INTRODUCTION

INTRODUCTION

The Budget Summary describes the fiscal year 2001 budget for the U.S. Department of Agriculture (USDA). All references to years refer to fiscal year, except where specifically noted. Throughout the booklet, A1996 Farm Bill@ is used to refer to the Federal Agriculture Improvement and Reform Act of 1996.

! Program Level represents the gross value of all financial assistance USDA provides to the public. This assistance may be in the form of grants, guaranteed or direct loans, cost-sharing, professional services such as research or technical assistance activities, or in-kind benefits such as commodities.

! Budget Authority is the authority to commit funds of the Federal Treasury. Congress provides this authority through annual appropriations acts and substantive legislation which authorizes direct spending. The President's budget requests the Congress to appropriate or otherwise provide an amount of budget authority sufficient to carry out recommended government programs.

! Obligations are commitments of government funds. In order for USDA to make a valid obligation, it must have a sufficient amount of budget authority to cover the obligation.

! Outlays are cash disbursements from the Federal Treasury to satisfy a valid obligation.

Emergency funding to address natural and economic disasters in the agriculture and rural economies in recent years is reflected in USDA outlay trends. Outlays increased by $8.9 billion from $53.9 billion in 1998 to $62.8 billion in 1999, largely as a result of supplemental funding to address farm income and natural disasters. Additional supplemental funding in 2000, including funding proposed as part of the President=s Farm Safety Net Initiative, and other farm program outlays are projected to increase 2000 outlays by an additional $8.3 billion to $71.1 billion. Outlay estimates for 2001, although about $6.1 billion below the 2000 peak, include the proposed farm income, crop insurance, conservation and other initiatives to improve the farm safety net.

USDA=s 2001 discretionary program outlays, about $16.7 billion, or about 26 percent of total USDA outlays, include the Special Supplemental Nutrition Program for Women, Infants and Children (WIC); rural development; research and technical assistance; soil and water conservation technical assistance; management of the National Forests and Grasslands; State and Private Forestry Programs; and domestic and international marketing assistance. Mandatory programs account for the remaining 74 percent of USDA outlays, about $48.2 billion in 2001. These programs provide services as required by law and include the majority of the nutrition assistance programs, commodity programs, and a number of conservation programs. The total USDA program level is projected to decrease from $105.4 billion in 2000 to an estimated $100.2 billion in 2001.