USDA Announces "Farmer" Definition Changes

March 24, 2015 01:53 PM
USDA Announces "Farmer" Definition Changes

Want to receive safety net payments for your farm? Under a newly proposed USDA rule, you might need to document 500 annual hours of substantial management work.

Power Hour Noon LogoIn an announcement Tuesday morning, USDA said the proposed definition of an actively engaged farmer only applies to non-family joint ventures and general partnerships with more than one member. Farm managers in those cases must document significant contributions to the operation. In lieu of 500 hours, managers must have invested “25% of the critical management time necessary for the success of the farming operation.”

The agency has reiterated family farms are not affected by the proposed changes, which would apply to payment eligibility beginning in crop year 2016 for Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) farm bill programs; loan deficiency payments; and marketing loan gains from the Marketing Assistance Loan program.

For operations affected by the new rule, multiple operators will be eligible for payments under specific circumstances.

“Operators that can demonstrate they are large and complex could be allowed payments for up to three managers only if they can show all three are actively and substantially engaged in farm operations,” USDA notes.

Congress directed USDA to develop a new actively engaged farmer rule as part of the farm bill. The changes attempt to better target government subsidies to avoid sending payments to farm managers ineligible to receive them.

Farmers and other stakeholders may comment on the proposed changes in writing at Comments must be submitted by May 26, 2015.

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