Government Relations & Washington Update
March 2025
House Passes Budget Resolution
On February 25th, House Republicans were successful in passing a budget resolution by a vote of 217-215. It was a party-line vote, with only one Republican voting against the resolution. The House is taking the approach of one major bill to address border security, defense and energy priorities as well as provide $4.5 trillion in tax cuts. The resolution directs committees to cut at least $1.5 trillion in spending over the 10-year budget window including $230 billion from USDA. It is likely that most of the USDA cuts would come from nutrition programs. The reduction in USDA spending could complicate the farm bill process by making fewer resources available for a new bill and drawing opposition from Democrats who strongly disagree with reducing nutrition spending. The Senate is also working to advance a budget resolution, but they are pursuing a two-bill strategy with one that would cover border and defense issues and another that addresses taxes. In order to utilize the budget reconciliation mechanism, the two chambers will ultimately have to reach agreement on the scope and approach and pass identical resolutions.
Congress Preparing for Continuing Resolution to Fund Government
The current continuing resolution keeping the government funded will expire on March 14th, setting up the potential for a government shutdown if Congress cannot pass another extension. Republican leaders in the House and Senate have indicated their intention to advance a long-term continuing resolution that would fund programs at 2024 levels for the remainder of the fiscal year. Appropriations Committee leaders prefer a short-term resolution, which would allow them additional time to pass new spending bills for fiscal year 2025. President Trump has recently signaled his support for the long-term option. While there are differences in the preferred approach, the broad recognition and support for some type of continuing resolution appears to indicate that there is not an appetite for a shutdown.
Trump Administration Continues Federal Workforce Reforms
The Trump Administration is continuing its efforts to transform and reduce the size of the federal workforce. The process began with a federal buyout option giving employees to option to resign and continue receiving pay through the end of the fiscal year. Approximately 3 percent of federal workers chose this option. Subsequently, agencies have undertaken reductions in force, particularly targeting probationary employees (usually within a year or two of employment in a given position). USDA agencies participated in the reductions impacting employees at agencies including the National Institute of Food and Agriculture (NIFA), the Economic Research Service (ERS) and others. Some USDA employees were laid-off and later reinstated when it was determined that their positions were needed. Since that time, a federal judge has ruled that the Office of Personnel Management (OPM) does not have the authority to order the termination of probationary employees, putting the status in question as the legal process moves forward. OPM has also sent emails requesting employees to reply with recent job activities. While there are differences in how agencies are approaching the email, employees declining to respond could be in jeopardy of losing their job. The administration has indicated that further reductions are expected and has directed agencies across the federal government to submit plans by March 13th for “large scale reductions in force”. Factors for termination or retention will include whether an employee is considered “essential” and if their function can be specifically tied to filling a statutory requirement.
Trump Administration Prepares for Reciprocal Tariffs
In addition to country specific tariffs being announced for Mexico, Canada and China related to the border and fentanyl (currently slated to go into effect on March 4th), President Trump is pursuing broader tariff policies. On February 13th, Trump signed an executive order establishing a framework for imposing “reciprocal” tariffs on U.S. trading partners with higher import duties than those faced by their exports to the United States. The order directs federal agencies to analyze the economic impact of these tariff imbalances and propose remedies to level the playing field for American industries.
The investigation will assess not only tariff disparities but also non-tariff trade barriers, subsidies, exchange rate policies, and value-added tax systems that could disadvantage U.S. producers. Agencies must submit their findings in a report, with proposed policy responses, following the completion of broader trade policy reports due by April 1. However, during a press conference, Commerce Secretary nominee Howard Lutnick indicated that the administration could be prepared to act as soon as the reports are submitted.
As the administration moves forward with its trade agenda, the impact of reciprocal tariffs will depend on how trading partners respond and whether the proposed measures align with U.S. international commitments. The findings from the upcoming trade reports will likely shape the next steps in the administration’s strategy to enforce tariff parity.
USDA Announces Avian Influenza Plans
On February 26th, USDA announced that it will invest $1 billion to combat the avian flu through a five-prong strategy. Major elements of the plan include:
- $100 million will be invested in research and development related to a vaccine. However, USDA made clear that use of a vaccine has not yet been authorized and consultations with states, industry, health professionals and trading partners before any vaccine authorization.
- USDA will be instituting policies for reducing US egg exports and increasing egg imports to help address egg supply challenges.
- $500 million will be invested in implementing “gold-standard” biosecurity measures at poultry facilities. In addition, USDA will provide free audits and wildlife biosecurity assessments, which will build on a pilot program that has been tested on 150 U.S. poultry farms.
- USDA will also pay up to 75% of the cost to address any identified biosecurity vulnerabilities at poultry farms. $400 million will be dedicated to increasing indemnity rates to better reflect market values as well as streamlining the payment process.