For Agriculture, the Administration proposes to reduce total discretionary spending by over $3 billion from FY2010 levels. (Congress has not yet passed a final FY2011 budget; a Continuing Resolution based on 2010 levels is funding the government at least until March 4).

The President’s budget emphasizes clean energy development. Specific clean energy development funding proposals  include:

• Rural Energy for America Program (REAP) – $106.8 million. Includes $36.8 million in proposed discretionary funding plus $70 million mandatory funding from the 2008 Farm Bill. Total program funding is a small increase over current funding levels ($99.34 in FY2010).
• Biomass Crop Assistance Program (BCAP) – $198 million. To refocus this important program on its primary purpose of encouraging new energy crop development, the Administration proposes to cap funding for the Collection, Harvest, Storage and Transport component at $70 million, which would leave most of the funding ($128 million) for establishing and growing energy crops.
• Rural Utilities Service loans – $6 billion for low-interest Federal Financing Bank loans. As in FY2011, the Administration commendably wants most of these loans to finance new clean energy projects, and proposes that:
  • Not less than $4 billion shall be used for renewable energy plants or for fossil fueled plants with carbon sequestration;
  • Funding may be used for fossil peaking units operating in conjunction with wind and solar power; and
  • Not more than $2 billion may be used for projects to reduce pollution from fossil fueled plants. 

Next steps include House and Senate committee hearings on its budget proposals, and intense jockeying in Congress over the future of these and other programs. Stay tuned for more developments. And you can visit here for current information on the unsettled 2011 budget picture.

President Obama’s detailed budget proposal for all government programs today includes an additional $68.1 million in “discretionary” funding for REAP. The 2008 Farm Bill also allocated $60 million in “mandatory” funding for REAP next year.

President Obama’s historic proposal builds upon funding for other energy programs in the American Recovery and Reinvestment Act by targeting REAP funding which supports a broad range of clean energy technologies for agriculture and rural America. His proposal confirms the Administration’s position that a well-funded REAP helps restore our economy.

In March 2009, for example, USDA Secretary Tom Vilsack, referring in part to REAP, told Congress that “part of our economic recovery is to focus on clean energy and green jobs, agriculture needs to be a part of that. It needs to be a huge part of the solution.”  REAP is part of that solution.

Among other programs in the Energy Title, the President also proposed to increase funding for building biorefineries to produce advanced biofuels.

We will provide additional budget details at FarmEnergy.org.

Summary of the Farm Energy Economic Recovery Program

You can download the full letter here (PDF format). Following is a quick summary of the three-part proposal.

Expand Funding for Farm Bill Energy Title Programs

• Include at least $1.2 billion in additional funding for important Farm Bill Energy Title programs like the Rural Energy for America Program (REAP), Biorefinery Assistance Program, Repowering Assistance and Biomass Crop Assistance Program.

More information on all energy title programs can be found in our Farm Bill Policy section.

Extend and Improve Clean Energy Tax Credits

• Extend the federal Production Tax Credits (PTC) for wind and biomass power for five years.

 

• Change structure of PTC and investment tax credit (ITC) to make them fully refundable.

 

• Stimulate 2009 investment by permitting tax credits from new
  investments in 2008 and 2009 to be carried back against tax liability
  from the past decade.

 

• Create a level playing field for producers of renewable electricity by modifying the PTC so all renewable sources of electricity will be eligible for the full credit.

Expand Successful Clean Renewable Energy And Conservation Bond Programs

• Extend and expand funding for Clean Renewable Energy Bonds and Qualified Energy Conservation Bonds.

 

• These bond programs provide PTC-like incentives for electric
  cooperatives, public power, and municipalities to build new renewable energy facilities and invest in energy efficiency.

Letter Signers

Following is a list of the groups and companies who signed onto the letter:

25x’25 Alliance

American Agri-Women

American Coalition for Ethanol

Association of Consulting Foresters

Association of State Energy Research & Technology Transfer Institutions

Biomass Power Association

Biotechnology Industry Association

Ceres

CHS, Inc.

Clean Energy First

Climate Solutions

Environmental and Energy Study Institute

Environmental Law & Policy Center

Forest Landowners Association

Intertribal Council On Utility Policy

John Deere

Native Wind

National Alliance of Forest Owners

National Association of Forest Service Retirees

National Association of State Energy Officials

National Association of Wheat Growers

National Corn Growers Association

National Farmers Union

National Rural Electric Cooperative Association

National Sorghum Producers

National Wildlife Federation

National Woodland Owners Association

North American Equipment Dealers Association

Pinchot Institute for Conservation

Society of American Foresters

Solar Energy Industries Association

Southern Alliance for Clean Energy

The Farm Credit Council

The Stella Group, Ltd.