Food Aid Reform Update

Back in April of this year the Obama administration proposed significant reform to the way the United States government delivers food aid around the world. The two key components of the reform:

The first part of the proposal is to allow more flexibility in the delivery of emergency food aid, by allowing the food to be purchased in the country or nearby countries rather than purchased in the U.S. and shipped abroad. Currently food aid is purchased in the U.S. and shipped overseas. Over half of the cost of food aid is shipping (53%). The proposed reform would allow for more food to be delivered more quickly, reaching potentially 4 million more people without raising the cost of the program over current levels.

The second proposal is to phase out the practice of food aid monetization. Currently, non-emergency food aid is given to non-governmental and inter-governmental organizations who then sell on local markets to finance anti-poverty programs. The program has been a valuable source of money for these groups, but puts them in direct competition with local producers who may be crowded out of the market. The reform would allow for direct grants to these groups rather than giving them food to sell.

These proposals are not new, though the Obama administration’s plan is perhaps the most comprehensive effort to date for reform. For example, included in the proposals was a recommendation to place food aid under the jurisdiction of international relations committees rather than agricultural committees where the programs currently reside in the House and Senate.

One might think that delivering more food for less money would be an easy sell in a Congress rhetorically committed to reducing deficits. Yet, the devil is in the details. Food aid is a tiny part of the federal budget – about .05%, or about a nickel on every $100 spent. Yet the programs remain a significant stream of revenue for shipping companies, agricultural corporations, and some non-government organizations involved in the distribution of food aid. The food aid reform was first taken up in the appropriations process for FY2014 where this coalition of groups defeated it – at least for the first round. Both appropriations bills await floor debate where further action can be taken.

Food aid reform was then taken up in the farm bill. On the Senate side, a modest reform was passed allowing for an increase in local and regional purchases. Monetization remains in place, and the idea of changing committee jurisdictions is pretty clearly going nowhere soon. On the house side a more significant reform proposal was voted on as an amendment to the farm bill, but was narrowly defeated. With 203 votes in support of the reform, however, there is good reason to believe if addressed again, either through the 2015 appropriations bill, or a stand-alone bill that is being discussed, food aid reform is within reach.

Currently the modest reform passed on the Senate side remains in the farm bill which is now heading to a conference of Senate and House leaders who must negotiate a conference report that bridges the differences in the farm bills passed by each chamber. It is likely that the conference committee will not get a final bill until September. We’ll keep you posted. Our hope is that the Food Aid Reform Act, which takes on comprehensive reform in one bill, will get a hearing and garner support in Congress. As things stands, we cannot support the current version of the farm bill. The House passed the farm bill without including authorization for the supplemental nutritional assistance program (SNAP), more commonly, if incorrectly, known as food stamps.

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