GAO Report Criticizes USDA on Subsidy Rules

12:05PM Oct 08, 2013
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  Here are several highlights of the report.  The report can be found here.

•    Farm Service Agency officials consistently said current ‘actively engaged’ regulations are too vague to enforce in a meaningful way.

•    Farms organized as general partnerships receive the most in payments and have the highest percentage of members receiving payments based on ‘active personal management only.’  General partnerships with 11 or more individual members received 84 percent of their farm payments based on members contributing ‘active personal management only.’  

•    Operations that have members determined out of compliance at the local level for not being able to demonstrate adequate knowledge to contribute ‘active personal management’ have appealed the decisions to the state and federal levels and won because they have time to prepare the individual in question.  In one instance, an individual was still allowed to receive farm payments after failing two interviews with state and local USDA officials.  The individual finally persuaded a national official in the third attempt that they had adequate knowledge of the farming operation.

•    A farm in the Midwest which received roughly $400,000 in payments for 2012 was organized as a general partnership with six corporations and 11 individual members of the same family who ranged in age from 18-88.  Publicly available data indicated two of the individuals, including the 88 year-old, lived in South Florida and claimed ‘active personal management only’ for eligibility purposes.  



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