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Payment Limit Rule in 2015

The USDA rules on who is considered actively engaged in farming and eligible to receive commodity program payments should be out in early 2015, U.S. Deputy Secretary of Agriculture Krysta Harden told Wednesday.

Harden, who spoke earlier at the 50th anniversary meeting of the Iowa Soybean Association, was responding to a question about a letter from members of Congress to Agriculture Secretary Tom Vilsack this week that asked USDA to close a loophole that has allowed nonfarm investors in large operations to avoid payment limits by claiming to be actively engaged in the business.

Harden said USDA focused on writing rules for other parts of the 2014 Agricultural Act first, starting with disaster assistance and then the sign-up for new commodity programs.

“Actively engaged is a little more complicated, and it’s going to take us a little bit longer,” Harden said.

Although Visack is sympathetic to tightening up the loophole, “the farm bill did limit this to a certain category,” Harden said and added that she’s not certain how many farmers would be affected.

Senator Chuck Grassley, a longtime advocate of tougher payment limits, and five other members of the Senate and House of Representatives wrote to Vilsack Monday to say that USDA still has the power to define actively engaged narrowly, even though the conference committee that wrote the final farm law stripped out a provision that would have allowed only one farm operator who isn’t actively engaged in farming to receive payments.

“Although not included in the final conference report, there were bipartisan majorities in both chambers of Congress that approved a limit of one nonfarming ‘farm manager’ per operation who could remain eligible for farm subsidies. We believe the new rule USDA is required to write should take this approach, especially since both bodies of Congress have already approved it with individual votes. Additionally, beyond the rule required by the 2014 farm bill, USDA has always had the ability to close this loophole through administrative rulemaking,” said the letter. It was signed by Grassley, Senators Sherrod Brown (D-OH) and Tim Johnson (D-SD), and Representatives Jeff Fortenberry (R-NE), Rosa DeLauro (D-CT) and Earl Blumenauer (D-OR).

The letter cites a Government Accountability Office report that found that nonworking farm managers collected more than $266 million in farm program payments in 2012.

When Harden spoke to the ISA members, she was asked about cuts to conservation programs that were included in the government spending bill recently passed by Congress. The bill trims spending on the Conservation Stewardship Program (CSP) and the Environmental Quality Incentives Program (EQIP).

“It’s troubling to me personally,” Harden said. “It became a target and is a pot of money.” The cuts allowed members of Congress to fund other more favored programs.

When the Obama Administration prepares its budget proposals for 2016, “we will continue to push for funding,” she said.

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