USDA proposes to limit payments to non-farmers

Mar 24, 2015

Changes could be coming to what “actively engaged” means

Are you a farmer?

Are you an actively engaged farmer?

Are you sure about that?

The United States Department of Agriculture (USDA) is proposing a rule to limit farm payments to people who may be listed as farm managers but aren’t greatly involved in the actual farm management.

The current definition of “actively engaged” which was agreed upon in 1987 is a little bit vague. It allows people with “with little to no contributions to critical farm management decisions to receive safety-net payments if they are classified as farm managers, and for some operations there were an unlimited number of managers that could receive payments.”

"We want to make sure that farm program payments are going to the farmers and farm families that they are intended to help. So we've taken the steps to do that, to the extent that the Farm Bill allows," said Agriculture Secretary Tom Vilsack. "The Farm Bill gave USDA the authority to limit farm program payments to individuals who are not actively engaged in the management of the farming operation on non-family farms. This helps close a loophole that has been taken advantage of by some larger joint ventures and general partnerships."

If the proposal comes to pass, non-family joint projects and general partnerships must keep tabs on their managers and document their “significant contributions” – including up to 500 hours of substantial management work per year or about 25% of necessary management time to make the farm operation successful.

On some operations, only one manager can receive a payment. If operators can show they are large and complex enough, up to three managers could receive payment if it can be proven they are actively engaged.

The changes in the rule would apply for 2016 and subsequent crop years for Agriculture Risk Coverage and Price Loss Coverage among others.

Stakeholders who are interested in providing an opinion can do so until May 26, 2015.

Join the discussion and tell us how this proposed rule may affect your farming operation. Are you a small family farm or are you part of a larger operation?

Money in the hands of a farmer

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