USDA Further Restricts Farm Program Eligibility

Dec 16, 2015
Brantley at last week's USA Rice Outlook Conference

WASHINGTON, D.C. - Yesterday, the United States Department of Agriculture (USDA) finalized and published regulations that seek to define "active personal management" that will further limit its farm program payments to managers that are "actively engaged in farming."

On March 26 of this year, USDA published a draft rule seeking to define "active personal management" and requested public comments as required by section 1604 of the 2014 Farm Bill. Following USDA's request, USA Rice submitted two sets of comments to USDA through the Federal Register representing the USA Rice Farmers and the other set jointly with other commodity and farm organizations.

In general, the comments encouraged USDA to provide clarity of significant contributions to a farming operation to ensure that farm managers weren't excluded because of a narrowly defined regulation. The industry also asked for assurances that breaks in familial lineage due to death of a parent, grandparent, etc. did not result in a loss of payments to active farm managers.

Ben Mosely, vice president of government affairs for USA Rice said, "It appears our concerns have not been addressed so we're going to be thoroughly reviewing the final rule over the next several days and communicating with USDA to clarify potential impacts this rule could have on the rice industry."

He added, "Since the rule is set to go into effect during the 2016 crop year, we're going to push for a grace period or additional flexibility to make sure producers that need to reconstitute or reorganize their operations have ample time to work through the rule's complexity."

Arkansas rice farmer and chairman of USA Rice, Dow Brantley, echoed Mosely's thoughts.

"Given the general state of the farm economy it could be very costly for a lot of farmers to reorganize their operations and potentially lose payments for some of their farm managers," he said. "USDA has made clear that this rule does not affect family farms, but in rice country, due to evolving tax structures and legal complexities, most all of our operations are considered joint ventures or general partnerships but they're still farms and they're still run by families. Our organization worked hard to secure these farm safety net programs so it's unsettling to see our industry is now in jeopardy of losing a significant amount of what we worked to achieve."