Governor Newsom’s latest budget proposal for 2024-25, known as the “May Revision,” lacks critical program funding for climate smart agriculture programs – amplifying the need for a climate bond to include significant investments for a climate resilient food system.
The projected budget deficit of $44.9 billion has resulted in a mix of funding delays, clawbacks, and no new proposed funding for CDFA’s suite of climate smart agriculture programs and several other programs centered on supporting small and mid-size farmers.
This interruption in funding for popular programs among California farmers and ranchers will set back efforts to reduce greenhouse gas emissions and sequester carbon on agricultural land, and slow efforts to reach the state’s climate goals, including the State’s recently released goals for the natural and working lands sector.
With the proper programs and funding in place, the agricultural sector has the potential to make meaningful contributions to curbing climate change. Well-managed grazing lands have been shown to help reduce the spread and intensity of devastating wildfires by acting as a natural buffer. While farmers participating in groundwater recharge efforts play an important role in replenishing groundwater basins and reducing drought potential. The critical scaling of these efforts is hindered by the lack of necessary resources and funding year over year. The stakes remain high for farmers, ranchers and farmworkers who are on the frontlines of climate change impacts.
However, our food system affects all Californians – in addition to those on the front lines. Food insecurity and the effects of climate change including unprecedented wildfires, catastrophic flood events, droughts, and rising food prices continue to affect the lives of Californians throughout the state.
We call on the legislature and Governor Newsom to pass a climate bond measure that includes investments in infrastructure that we need to build a more healthy, just and resilient food and farming system, similar to the top priorities included in AB 408 (Assemblymember Lori Wilson, D-Suisun City).
To create a more equitable and resilient food and farming system, investments are essential to support:
- Climate smart farming practices such as improving soil health, water conservation and reducing dairy methane
- Protecting farmland from urban development
- Farmworker housing and weatherization
- Upgraded school kitchens
- New local food processing and distribution facilities
“California farmers are no strangers to boom and bust cycles and the challenges they pose,” said Brian Shobe, Policy Director of the California Climate and Agriculture Network (CalCAN). “We appreciate the Governor’s commitment to protecting recent years’ historic investments in CDFA’s climate smart agriculture programs and urge him to work with the legislature to pass a climate bond to ensure the continuity of these vital programs in the years ahead.”
Climate Smart Agriculture Program Budget Breakdown
Health Soils Program (HSP): $11 million allocated in a previous budget cycle remains protected and grant agreements are moving forward with those selected through the grant solicitation that took place earlier this year.
State Water Efficiency & Enhancement Program (SWEEP): The May Revision proposes to revert $2.8 million previously allocated to SWEEP in the Budget Act of 2021. The May Revision also proposes to remove $20.6 million allocated from the General Fund for SWEEP in a previous budget cycle and replace the funds with Greenhouse Gas Reduction Funds in 2026-27. These funding changes mean that the earliest there would be funding available for a SWEEP solicitation would be 2026, if the funding proposal is included in a future year’s budget act.
Alternative Manure Management Program (AMMP) & Dairy Digester Research and Development Program (DDRDP): $17 million allocated in a previous budget cycle will be moved to the Greenhouse Gas Reduction Fund (GGRF) for the FY 24-25. Another $7 million will be shifted to the GGRF in FY 25-26. Under this proposal, funds would be available to run a Dairy Plus Program (which combines federal climate smart commodities funding with state AMMP and DDRDP funding) solicitation this summer.
In his May Revision, the Governor proposes a strategy to protect cuts to previously allocated funding for the State Water Efficiency & Enhancement Program (SWEEP) and Alternative Manure Management Program (AMMP.) He proposes shifting the funding source for those programs from the General Fund to the Greenhouse Gas Reduction Fund, raised through the state’s cap-and-trade program, which historically has been the source of their funding.
CalCAN is in support of this shift and we urge the legislature to adopt it in the budget bills they will be debating over the next several weeks. However, we urge the legislature to fund SWEEP through the GGRF in FY 24-25, as opposed to FY 26-27 (the Governor’s proposal), so CDFA can proceed with running a SWEEP solicitation this fall. SWEEP technical assistance (TA) providers were funded last fall to support farmers in preparing SWEEP applications. Plus, CDFA opened a SWEEP solicitation in December until it was canceled due to a budget deficit directive from the Department of Finance. As such, many farmers and TA providers have already done the work to prepare projects and applications and are simply waiting for the solicitation to re-open.
Cuts for several other programs that serve small and mid-scale farmers were also confirmed in the May Revise. This includes initiatives like the Farm to Community Food Hub Program, the California Underserved and Small Producer Program, and the Water Efficiency Technical Assistance Program.
We acknowledge the difficulties the budget deficit presents this year, yet future program funding remains questionable as the Governor also projected a $33.1 billion negative budget balance in the 2025-26 fiscal year.
There are two crucial budget and bond deadlines from now until the end of June. The legislature must pass a budget bill by June 15 after reconciling the two versions being developed in the Assembly and the Senate. June 27 is the deadline for a climate bond bill to pass both houses, and the Governor must sign it for it to be included on the November ballot. CalCAN will continue to advocate against any deeper cuts to the climate and agriculture programs as we keep working with our partners to educate legislators about the need for bond investments in our food and farming sector.
Budget-specific details for the programs mentioned above, as well as others, can be found here.
