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USDA Stops Payments to Those Non-Actively Engaged in Farming
Wisconsin Ag Connection - 12/21/2015

The U.S. Department of Agriculture has finalized a rule to ensure that farm safety-net payments are issued only to active managers of farms that operate as joint ventures or general partnerships. The move, which exempts family farm operations, closes a loophole where individuals who were not actively part of farm management still received payments.

"The federal farm safety-net programs are designed to protect against unanticipated changes in the marketplace for those who actively share in the risk of that farming operation," said U.S. Agriculture Secretary Tom Vilsack. "To ensure that help goes to those who genuinely need it, such as America's farm families, the Farm Bill authorized USDA to close a loophole and limit payments from those not involved on a daily basis in nonfamily farm management."

Since 1987, the broad definition of 'actively engaged' resulted in some general partnerships and joint ventures adding managers to the farming operation, qualifying for more payments that did not substantially contribute to management. The rule applies to operations seeking more than one farm manager, and requires measureable, documented hours and key management activities each year. Some operations of certain sizes and complexity may be allowed up to three qualifying managers under limited conditions.

The changes apply to payments for 2016 and subsequent crop years for Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) Programs, Loan Deficiency Payments (LDP) and Marketing Loan Gains (MLG) realized via the Marketing Assistance Loan program.

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