This act reduces taxes, reduces or increases spending for various federal programs, increases the statutory debt limit, and otherwise addresses agencies and programs throughout the federal government.  

It is known as a reconciliation bill and includes legislation submitted by several congressional committees pursuant to provisions in the FY2025 congressional budget resolution (H Con. Res. 14) that directed the committees to submit legislation to the House or Senate Budget Committee that will increase or decrease the deficit and increase the statutory debt limit by specified amounts. (Reconciliation bills are considered by Congress using expedited legislative procedures that prevent a filibuster and restrict amendments in the Senate.)

TITLE I--COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

This title addresses a wide range of Department of Agriculture (USDA) programs, including by changing the Supplemental Nutrition Assistance Program (SNAP) and extending programs authorized by the Agriculture Improvement Act of 2018 (commonly known as the 2018 farm bill).

Subtitle A--Nutrition

(Sec. 10101) This section prohibits USDA from increasing the cost of the Thrifty Food Plan (TFP) based on a reevaluation of the contents of the TFP (i.e., the market basket of goods). Further, any annual adjustment to the cost of the plan must be based on the Consumer Price Index for All Urban Consumers.

As background, USDA created the TFP (the cost of purchasing a nutritionally adequate low-cost diet), which is used to determine maximum monthly benefits under the Supplemental Nutrition Assistance Program (SNAP). USDA calculates the cost of the TFP each year to account for food price inflation. Maximum allotments are set at the monthly cost of the TFP for a four-person family, adjusted for family size. Under a provision of the 2018 farm bill, USDA must reevaluate the market basket of goods every five years based on current food prices, food composition data, consumption patterns, and dietary guidance.

(Sec. 10102) This section increases the work requirements for certain SNAP recipients who are able-bodied adults.

As background, SNAP recipients who are able-bodied adults without dependents (ABAWDs) currently have work-related requirements in addition to the general SNAP work registration and employment and training requirements. SNAP law limits benefits to ABAWDs to 3 months out of a 36-month period, unless the participant meets the additional work-related requirements.

This section raises the age for those who must meet these additional work requirements to include adults who are 65 years old and younger, whereas these requirements currently apply to adults who are 55 years old and younger.

This section requires parents and household members to meet the additional work requirements (similar to someone who does not have a dependent child) if the child is age 14 and older. Currently, those with a child under the age of 18 are exempt from the requirements.

This section excludes from the additional work requirements SNAP recipients who are Indians, Urban Indians, or California Indians (as these terms are defined by the Indian Health Care Improvement Act). 

In addition, the section generally requires homeless individuals, veterans, and certain foster care individuals to meet these work requirements. Foster care individuals are those who are 24 years old or younger and were in foster care on the date of attaining 18 years of age or a higher age. Specifically, this section eliminates the current exclusion from the additional work requirements for these individuals based on this status.

Finally, this section limits the ability of a state to temporarily suspend the three-month time limit for SNAP benefits for ABAWDS in areas with high unemployment or an insufficient number of jobs. Under current law, the ABAWD waiver program allows states to request a temporary waiver of the three-month SNAP benefit limit. States may receive a waiver based on an area having an unemployment rate of over 10% or an insufficient number of jobs.

The section repeals the provision that allows a state waiver if that area does not have a sufficient number of jobs. Further, the section allows Alaska and Hawaii to qualify for the state exemption with an unemployment rate that is at or above 1.5 times the national unemployment rate, effectively lowering the unemployment rate that these states must meet to receive a waiver. 

(Sec. 10103) This section generally eliminates the ability of a household to use participation in certain energy assistance programs to determine SNAP income eligibility unless the household includes an elderly or disabled member. 

As background, a household may deduct a portion of their housing and utility costs from their income (i.e., the excess shelter expense deduction) when determining SNAP benefits. Under current law, a household that receives a certain level of energy assistance through the Low Income Home Energy Assistance Program (LIHEAP) or a similar energy assistance program may deduct a set allowance. This set allowance (i.e., Standard Utility Allowance or SUA) represents low-income household utility costs in the state or local area. Using this allowance makes qualifying for an excess shelter deduction more likely.

This section eliminates the use of the set allowance for households without elderly or disabled members, which may decrease the availability of the excess shelter deduction and reduce the SNAP benefits for these households.

(Sec. 10104) This section prohibits a household from using any internet connection service fees as part of their housing and utility costs for the purposes of determining the size of household SNAP benefits, thus potentially reducing the SNAP benefits for these households.

As background, a household may deduct a portion of their housing and utility costs from their income (i.e., the excess shelter expense deduction) when determining SNAP benefits. Under current law, household expenses may include internet connection service fees.

(Sec. 10105) This section establishes state-matching fund requirements for the cost of SNAP program allotments beginning in FY2028. The state contribution ranges from 0% to 15% for the cost of SNAP program allotments and is based on the state’s SNAP payment error rate. Currently, the state match is 0%.

For FY2028, a state may elect either the FY2025 or FY2026 payment error rate to calculate its state-matching fund requirement. For FY2029 and each fiscal year thereafter, the state match is calculated using the payment error rate for the third fiscal year preceding the fiscal year for which the state share is being calculated.

Any state that has a payment error rate that is less than 6% will have a state match of 0% (i.e., the state does not have to contribute). 

A state with a payment error rate that is

• at least 6% but less than 8% must contribute 5%,
• at least 8% but less than 10% must contribute 10%, and
• 10% or greater must contribute 15%.

In general, the effective date for the state-matching fund requirements is the beginning of FY2028. However, any state that has an error rate above a certain level will have implementation delayed until FY2029 or FY2030. Specifically, the implementation date is delayed for states where the state's error rate multiplied by 1.5 equals or exceeds 20% in FY2025 or FY2026. For such states, the implementation date is delayed until FY2029 if the specified error rate occurs in FY2025 and until FY2030 if the error rate occurs in FY2026. 

(Sec. 10106) This section reduces the amount that USDA may pay a state agency for administrative costs for the operation of SNAP to 25% of all administrative costs beginning in FY2027 and for each fiscal year thereafter. Currently, USDA must pay 50% of all administrative costs, thus this section increases the state share of administrative costs from 50% to 75%.

(Sec. 10107) This section eliminates funding for the SNAP Nutrition Education and Obesity Prevention Grant Program (SNAP-ED). SNAP state and local agencies administer this federal grant program. SNAP-Ed uses evidence-based, public health projects and interventions with the goal to implement a nutrition education and obesity prevention program for eligible individuals that promotes healthy food choices and physical activity consistent with the most recent Dietary Guidelines for Americans.

(Sec. 10108) This section eliminates SNAP eligibility for certain individuals who are classified as an alien under federal law and legally present in the United States, including those who have qualified for conditional entry under the asylum and refugee laws or based on urgent humanitarian reasons (e.g., a survivor of domestic violence or human trafficking).

The section maintains SNAP eligibility for individuals who reside in the United States and are (1) U.S. citizens or U.S. nationals; (2) lawful permanent residents, with exceptions; (3) aliens who are Cuban or Haitian entrants; or (4) individuals who are lawfully residing in the United States in accordance with the Compacts of Free Association between the United States and Micronesia, the Marshall Islands, and Palau.

Subtitle B-- Forestry

(Sec. 10201) This section rescinds certain funds provided to the Forest Service as part of the Inflation Reduction Act of 2022. For example, this includes the rescission of funds for 

• the protection of old-growth forests on National Forest System land,
• grants for nonfederal forest landowners for climate mitigation or forest resilience practices,
• grants for state and private forestry conservation programs for tree planting, and
• administrative costs for the National Forest System to implement these and other related programs.

Subtitle C--Commodities

This subtitle amends and extends commodity support programs.

For example, the subtitle extends the Price Loss Coverage (PLC) program, the Agricultural Risk Coverage (ARC)  program, and Dairy Margin Coverage (DMC) through crop year 2031. It also modifies various requirements for the programs.

(Sec. 10301) This section increases the reference prices for specified commodities under the ARC and PLC programs for crop years 2025 through 2030. This change would increase the likelihood of triggering a payment and increase the payments made to eligible producers when triggered.

Beginning in crop year 2031, USDA must increase the reference price so that it is equal to the reference price in the previous crop year multiplied by 1.005. USDA must continue to increase the reference price using this formula for each crop year after 2031, up to a maximum of 113% of the 2030 reference price.

The ARC and PLC programs, administered by the Farm Service Agency, offer financial assistance to eligible agricultural producers, and the reference prices are used to calculate benefits under the programs. The ARC program is an income support program that provides payments to producers triggered when actual crop revenue declines below a specified guarantee level. The PLC program provides income support payments triggered when the effective price for a covered commodity falls below its effective reference price.

(Sec. 10302) This section grants eligible agricultural producers a one-time option to expand and allocate base acre holdings in proportion to average 2019-2023 plantings of covered and noncovered commodities. In general, the Price Loss Coverage and Agriculture Risk Coverage programs make payments per enrolled base acre (i.e., a unit of production associated with specific tracts of farmland in proportion to historical production of certain crops).

This section allows producers to allocate existing unassigned base acres to a covered commodity. The section limits the total existing unassigned and newly granted base acres to no more than 30 million acres, effectively increasing total base acres nationwide from approximately 274 million to approximately 304 million.

(Sec. 10303) This section requires producers to make an election to obtain ARC or PLC on a covered-commodity-by-covered commodity basis through crop year 2031. For the 2025 crop year, this section requires USDA, on a covered commodity-by-covered commodity basis, to make the higher of PLC payments or ARC county coverage payments to the producers on a farm for the payment acres for each covered commodity on the farm.

(Sec. 10304) This section extends the PLC program through crop year 2031.

(Sec. 10305) This section extends the ARC program through the 2031 crop year. It also increases the coverage guarantee level from 86% to 90% of the benchmark revenue and increases the maximum payment amount from 10% to 12.5% of the benchmark revenue. These changes increase the likelihood of triggering a payment and increase the payments made to eligible producers when triggered.  

(Sec. 10306) This section establishes a definition for a qualified pass-through entity, which includes certain partnerships and S corporations (as defined in the Internal Revenue Code) and certain limited liability companies, joint ventures, and general partnerships. It also generally requires these entities to be treated in the same manner as current law treats general partnerships and joint ventures for the purpose of payment limitations. For example, the section replaces an existing exception to payment limitations for joint ventures and general partnerships with an exception for qualified pass-through entities.

(Sec. 10307) This section increases the maximum ARC and PLC payment limit per person from $125,000 to $155,000. A producer is eligible to receive up to $155,000 in peanut payments and up to $155,000 in payments for all commodities except peanuts (i.e., up to $310,000 total for all commodities inclusive). USDA must adjust payment limits for inflation annually beginning with the 2025 crop year.

As background, certain payment limits and eligibility criteria apply to multiple farm programs, including ARC, PLC, and certain disaster assistance programs and conservation programs.

(Sec. 10308) This section waives the adjusted gross income (AGI) limitations for payments or benefits under certain USDA disaster assistance and conservation programs for a person or legal entity that derives a portion of their income from agriculture. Specifically, the exception allows producers and business entities whose AGI exceeds $900,000 to participate in certain disaster assistance and conservation programs if 75% or more of their AGI (i.e., gross income before applying adjustments to calculate the AGI) is derived from eligible agricultural activities.

The eligible activities are farming, ranching, or siviculture activities, including agritourism, direct-to-consumer marketing of agricultural products, and the sale of agricultural equipment owned by such person or entity.

(Sec. 10309) This section extends the Marketing Assistance Loan (MAL) program nonrecourse and recourse loans through the 2031 crop year. It also sets MAL rates for crop years 2026-2031. This section also extends Loan Deficiency Payments (LDPs) through the 2031 crop year. The MAL and LDP programs provide price support to producers when market prices drop below statutory levels.

This section also extends the Special Competitive Provisions for Extra Long Staple (ELS) Cotton program. This program makes payments to eligible mills that use ELS cotton and eligible exporters of ELS cotton.

As background, there are two main species of cotton cultivated for commercial use, upland cotton (which comprises 97% of U.S. production) and extra-long staple (ELS) cotton. U.S.-grown ELS cotton is also referred to as Pima cotton.

(Sec. 10310) This section changes how world prices for upland and ELS cotton are calculated for the purpose of repaying MALs.

(Sec. 10311) This section increases the payments to domestic users of upland cotton who participate in the Economic Adjustment Assistance for Textile Mills program. This program makes monthly payments to eligible domestic cotton mills. The payments must be used for capital investments that contribute to domestic manufacturing of upland cotton.

(Sec. 10312) This section makes several modification to USDA's sugar program. As background, the U.S. sugar program supports the U.S. sugar industry (i.e., producers and processors of sugarcane and sugar beets) by providing Marketing Assistance Loans (MALs) to sugar processors, restricting domestic supply of sugar with marketing allotments for sugar processors, and limiting sugar imports through tariff-rate quotas.

Specifically, this section increases the marketing loan rate for raw sugar cane processors and increases the rate for beet sugar processors for crop years 2025-2031.

This section also increases the storage rates USDA pays to processors for forfeited refined sugar and forfeited raw cane sugar. Under current law, when sugar is used to collateralize a MAL loan and is forfeited by a sugar processor, USDA must provide payments to the processors who store the forfeited sugar.

This section extends the provisions for the flexible marketing allotments for sugar through crop year 2031. In addition, in operating sugar support programs, USDA must prioritize sugar beet processors if marketing allotments are adjusted higher. Additionally, if sugar beet marketing allotments need to be adjusted, USDA must reassign sugar beet marketing allotments within 30 days of the publication of USDA's January World Agricultural Supply and Demand Estimates (WASDE) report. 

Finally, USDA must study whether the establishment of additional terms and conditions with respect to refined sugar imports is necessary and appropriate and submit a report to Congress. Based on the study, USDA may issue regulations to establish additional terms and conditions for refined sugar imports.

(Sec. 10313) This section extends Dairy Margin Coverage (DMC) through crop year 2031 and provides for a number of changes to the DMC program.

As background, DMC allows participating milk producers to buy a guaranteed margin for their milk production. The DMC program pays participating producers the difference between a producer-selected guarantee and the national milk margin (all-milk price minus an average feed cost ration). Margin payments are based on producers' milk production history, not actual milk marketings (i.e., quantity of milk sold). Producers pay annual premium rates based on two tiers of production history.

Changes to the program include

• altering how USDA determines production history to remove the consideration of production at the time the dairy operation first registered to participate in the DMC program;
• setting production history for the DMC program as the highest annual milk marketings for participating dairies during calendar year 2021, 2022, or 2023;
• raising the coverage limit to the first 6 million pounds of production history for both Tier I and Tier II premiums, from the first 5 million pounds; and
• allowing producers to receive a 25% premium discount for a one-time premium election covering calendar years 2026-2031.

(Sec. 10314)  This section requires USDA to make available specified funds to carry out this subtitle. It also requires USDA to use specified funds to administer a mandatory survey of dairy product