Statement of Administration Policy: H.R. 2467 - 1988 Disaster Assistance Extension Act

(Revised LA 6/26/89)
(House)
(de la Garza (D) TX and 33 others)

The Administration opposes enactment of H.R. 2467. Although limited disaster assistance may be appropriate for winter wheat producers, enactment of any drought relief legislation would be premature until better information on crop yields is available. It is clear, however, that enactment of across-the-board disaster relief legislation is inappropriate under current circumstances, because recent rains have greatly improved the prospects for spring-planted crops.

The Secretary of Agriculture has stated that he could not recommend to the President that he sign any disaster assistance bill unless it:

• is budget-neutral and would not lead to a sequestration under the Gramm-Rudman-Hollings Act;
• applies only to 1989 crops affected by drought; and
• is accompanied by an agreement between Congress and the Administration that Federal crop insurance will be the sole vehicle for crop disaster assistance in the future.

H.R. 2467 fails to meet at least two of these requirements.

First, it would broadly extend the 1988 Disaster Assistance Act to all commercial crops damaged by any adverse weather condition in 1988 or 1989. Second, although the bill includes a requirement that relief recipients purchase crop insurance for 1990 crops, this provision includes enough exceptions to render it ineffective.

Finally, although H.R. 2467 includes a provision intended to render the bill budget-neutral and to prevent it from triggering sequestration, it is impossible to ensure the latter result, due to the nature of the Gramm-Rudman-Hollings sequestration mechanism. In this regard, the Department of Agriculture estimates that full implementation of H.R. 2467 would increase Federal outlays over fiscal years 1989 and 1990 by $1.0 to $1.5 billion.

The Secretary of Agriculture and the Director of Office of Management and Budget would recommend disapproval of H.R. 2467 if it is presented to the President in its current form.