State Budget Cuts to Affect Ag Dept.
Published: Friday, May 9, 2025
The Indiana State Department of Agriculture is facing a double-digit reduction in its 2026 budget as a result of state budget cutting.
Don Lamb, ISDA director, characterized the cuts as "significant." However, he said ISDA is not alone. Other state agencies also saw a reduction in their budgets.
"One thing that makes it more palatable is the fact that we're all in the same boat," Lamb said. "Pretty much across the board, there were cuts."
For ISDA, the cuts fall somewhere between 12-13%, he said. Then there is another 5% reserve that will go away.
"There's a 5% reserve that they really don't want you to budget for," Lamb said. "It's not that it's out of your budget necessarily, but it would be something held back like a savings account toward the end of the year, if things don't go as well as expected."
The fiscal year starts July 1, so there is time before any decisions need to be made.
"To us, it's significant just because 85% of our budget is people," he said. "If you get anywhere from a 12-20% cut, it ends up affecting people, because we don't have a lot of programs in the Department of Ag that we would cut out."
In remarks at the Indiana Milk Quality Conference in March, Lamb shared that ISDA already operates on a lean budget.
Speaking earlier this week via a telephone interview, Lamb said Indiana has one of the smallest agriculture departments in the country, yet Indiana is the ninth largest farming state and the seventh largest agricultural exporter.
"There's no doubt we punch above our weight when it comes to things that agriculture does in Indiana," Lamb said.
In Indiana, ISDA doesn't have much regulatory authority. Instead, the agency works with regulatory partners, such as the state chemist's office and the Board of Animal Health (BOAH).
"We love the partnerships that we have in Indiana," Lamb said. "I think that is a strength of Indiana. But it means that when it comes to budget time, we're not just worried about our budget. We're worried about the Board of Animal Health, we're worried about the state chemist's office, and we're worried about even the Department of Health doing some of the food safety things."
Denise Derrer, spokesperson for BOAH, said the agency was spared any budget cuts, except for the 5% reserve.
"The biennial budget approved by the General Assembly maintains funding to the board of animal health at its current level," Derrer said. "However, like all the state agencies under that House Bill 1001, the Board of Animal Health must hold back 5% of the total in reserve that is not accessible. So, our current agency's leadership is working on a spending plan for the new fiscal year that starts July 1 that will be reduced by 5%."
Like ISDA, Derrer said BOAH is managing an increasing workload with the same number of inspectors and other personnel.
"We're going to do the best we can with what we have," Derrer said. "Really, our biggest ongoing fiscal challenge is going to be the state meat and poultry inspection program, which is half funded by USDA Food Safety Inspection Service (FSIS)."
During the past couple of years, Derrer said FSIS has not met its full 50% funding obligation, "so that's left the state to fill the gap." She added, "That comes at a time when demand for locally sourced meat has been stronger than ever."
Demand for meat inspection is being driven by the growth of local processors coming online.
"We're committed to doing what we can to serve those small businesses, because they're really fueling local economies," she said. "We're doing what we can, but that's a challenge because obviously we're not going to have capacity to do a lot of additional hiring."
Derrer said BOAH is "working really tight right now."
BOAH also leads the state's avian influenza response, but she said that funding comes from a cooperative agreement with federal agencies. That funding covers costs for milk testing in dairy herds and the avian flu response in the poultry sector.
The budget cuts were the topic of a Monday meeting between Purdue University President Mung Chiang and other state agriculture leaders. Lamb was in attendance.
"That was the theme of that meeting," Lamb said. "We all didn't get the money we would have liked out of the Legislature, and the federal government is putting pressure on us as well."
As agency heads figure out how to do more with less, Lamb said this situation reminds him of farming.
"You can complain about that or whine about it, or you can roll up your sleeves and get to work and do something with what you've got," he said. "And that's what agriculture does. It's so much like farming. There's good years and there's bad years, and there's years that you really have to buckle down and really set your priorities and make sure you know what's important. Agriculture is really good at doing that."
Even with the cutbacks, Lamb said the Indiana Dairy Strategy 2.0 will continue.
"It is still very much alive," he said.
Currently, the dairy industry represents a bright spot in the overall ag economy, Lamb said. Indiana's dairy industry produces significantly more milk than it did in 2014 but with the same number of cows and only half the farms.
"It's pretty amazing what dairy has done," he said.
Lamb said new dairy farms have been approved in Warren and Rush counties, and ISDA is working on the economic development front to attract more processing.
"It's still a topic that we're talking about an awful lot," he said.
The first dairy strategy in 2015 resulted in a major expansion of processing. The biggest was a new Walmart milk processing facility in Fort Wayne.
"We're really ready for something else like that," he said.
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