Estimated Budgetary Effects Relative to the Current-Law Baseline
CBO estimates that direct spending authorized by the draft legislation over the 2014-2023 period would total $940 billion. Relative to spending projected under CBO’s May 2013 baseline, CBO estimates that enacting the draft legislation would reduce direct spending by $33.3 billion over the 2014-2023 period. Further details of that estimate are displayed in the enclosed tables. Table 1 shows CBO’s estimate of the budgetary effects by title; Table 2 provides estimates pertaining to specific agricultural commodities under title I of the legislation; and Table 3 shows estimates for specific provisions within the various titles of the proposal.
Because the proposal would affect direct spending, pay-as-you-go procedures apply. Enacting the proposed legislation would not affect federal revenues. CBO has not estimated the additional discretionary spending for agricultural programs that would result from implementing the proposal; such spending would be subject to appropriation actions. CBO also has not reviewed the proposal for intergovernmental or private-sector mandates.
Estimated Budgetary Effects Assuming That Sequestration Under the Budget Control Act Were Repealed
You also requested that CBO estimate the savings that would be attributable to the draft legislation if reduced spending attributable to sequestration was not already incorporated in our cost estimate. Under that law, $593 million in 2013 spending authority for mandatory agricultural programs was cancelled. That sequestration, in turn, resulted in a reduction of roughly $6.4 billion in CBO’s baseline projections for mandatory agricultural programs over the 2014-2013 period. Those savings are a part of CBO’s most recent baseline spending estimates and are therefore reflected in the estimate of savings for the draft legislation mentioned on page 1 and shown in Table 1.
However, if other legislation were enacted to repeal provisions of the Budget Control Act of 2011 regarding sequestration and the Congress subsequently enacted the committee’s draft legislation, CBO estimates that it would reduce direct spending by $39.7 billion over the 2014-2023 period.
Table 4 displays CBO’s estimates of the impact of sequestration on the baseline for the mandatory spending programs that would be affected by the draft legislation.