Washington, D.C. —
Today Senator John Thune announced that the United States Department of Agriculture (USDA) has agreed to use the 2007/2008 crop years for the new Average Crop Revenue Election (ACRE) Program, and that signup has begun for the 2009 Direct and Counter-cyclical Payment (DCP) program.
In September, Senator Thune led several of his colleagues in sending Secretary of Agriculture Ed Schafer a letter that specified Congressional intent and the correct interpretation of a statute for a new 2008 Farm Bill safety net option, the ACRE Program, which producers have the option to use in place of the counter-cyclical program.
ACRE program assistance is determined in part by using an average of the prices for each covered commodity for the two years previous to the year of participation to establish a price baseline. Because farmers have the option to participate in ACRE beginning with the 2009 crop year, Congress intended that the average of 2007 crop prices and projected 2008 crop prices be used as the ACRE baseline crop prices for the 2009 crop year.
Senator Thune initiated the September letter because after the 2008 Farm Bill was passed comments made by USDA officials indicated that USDA intended to implement the ACRE program using the average of 2006 and 2007 prices, which would have resulted in much lower baseline prices and an ineffective safety net for farmers participating in ACRE. The national average crop prices for ACRE-eligible commodities are expected to be higher for 2007 and 2008 than the average for 2006 and 2007 crops.
The letter also informed the Secretary that the Congressional Budget Office (CBO) used the higher 2007-2008 projected average price to determine the cost of ACRE in the 2008 Farm Bill. Therefore, implementing ACRE using the years Congress intended means the 2008 Farm Bill would be of no additional cost to taxpayers than what was determined by CBO in its original Farm Bill baseline.
Producers may make a one-time election to participate in ACRE, beginning with the 2009 crop year, on a farm-by-farm basis. Participation in ACRE is an alternative to receiving counter-cyclical payments, and ACRE participation also results in a 20 percent reduction in direct payments and a 30 percent reduction in marketing assistance loan rates for all covered commodities on a farm. Producers may choose to enroll a farm in ACRE for any of the years 2009, 2010, 2011, and 2012. However, once a farm is enrolled in ACRE, that farm must continue to be enrolled in ACRE through 2012.
“The statute very clearly provides that the 2007 and 2008 average crop prices shall be used to calculate ACRE assistance,” said Thune. “I am pleased that USDA is following the intent of Congress and the Senate Agriculture Committee by using the 2007 and 2008 crop years for the ACRE Program. Giving producers the option of an ACRE program using more current prices as a baseline is particularly important as producers face volatile commodity prices and historically high input costs.”
According to a USDA, producers are urged to make use of the eDCP automated website to sign up, which can be accessed at http://www.fsa.usda.gov/dcp. To access the service, producers must have an active USDA eAuthentication Level 2 account, which requires filling out an online registration form at http://www.eauth.egov.usda.gov followed by a visit to the local USDA Service Center for identity verification.
Producers can also visit any USDA Service Center or their administratively assigned center to complete their 2009 DCP contract. There is a mandatory June 1, 2009 deadline for all participants. USDA has announced that it will not accept any late-filed applications.
The USDA is expected to begin ACRE signup this spring.
Thune also is urging producers who wish to receive any federal farm payments that will be considered 2008 calendar year income to visit their local FSA offices and complete all necessary paperwork by close of business on December 24th. Due to a new payment centralization process which has recently been put in place by USDA to minimize improper payments, county FSA offices no longer have the capability of writing paper or manual checks.
"If producers want 2008 income for any programs administered through their FSA offices they need to contact their local FSA office as soon as possible," said Thune.
In September, Senator Thune led several of his colleagues in sending Secretary of Agriculture Ed Schafer a letter that specified Congressional intent and the correct interpretation of a statute for a new 2008 Farm Bill safety net option, the ACRE Program, which producers have the option to use in place of the counter-cyclical program.
ACRE program assistance is determined in part by using an average of the prices for each covered commodity for the two years previous to the year of participation to establish a price baseline. Because farmers have the option to participate in ACRE beginning with the 2009 crop year, Congress intended that the average of 2007 crop prices and projected 2008 crop prices be used as the ACRE baseline crop prices for the 2009 crop year.
Senator Thune initiated the September letter because after the 2008 Farm Bill was passed comments made by USDA officials indicated that USDA intended to implement the ACRE program using the average of 2006 and 2007 prices, which would have resulted in much lower baseline prices and an ineffective safety net for farmers participating in ACRE. The national average crop prices for ACRE-eligible commodities are expected to be higher for 2007 and 2008 than the average for 2006 and 2007 crops.
The letter also informed the Secretary that the Congressional Budget Office (CBO) used the higher 2007-2008 projected average price to determine the cost of ACRE in the 2008 Farm Bill. Therefore, implementing ACRE using the years Congress intended means the 2008 Farm Bill would be of no additional cost to taxpayers than what was determined by CBO in its original Farm Bill baseline.
Producers may make a one-time election to participate in ACRE, beginning with the 2009 crop year, on a farm-by-farm basis. Participation in ACRE is an alternative to receiving counter-cyclical payments, and ACRE participation also results in a 20 percent reduction in direct payments and a 30 percent reduction in marketing assistance loan rates for all covered commodities on a farm. Producers may choose to enroll a farm in ACRE for any of the years 2009, 2010, 2011, and 2012. However, once a farm is enrolled in ACRE, that farm must continue to be enrolled in ACRE through 2012.
“The statute very clearly provides that the 2007 and 2008 average crop prices shall be used to calculate ACRE assistance,” said Thune. “I am pleased that USDA is following the intent of Congress and the Senate Agriculture Committee by using the 2007 and 2008 crop years for the ACRE Program. Giving producers the option of an ACRE program using more current prices as a baseline is particularly important as producers face volatile commodity prices and historically high input costs.”
According to a USDA, producers are urged to make use of the eDCP automated website to sign up, which can be accessed at http://www.fsa.usda.gov/dcp. To access the service, producers must have an active USDA eAuthentication Level 2 account, which requires filling out an online registration form at http://www.eauth.egov.usda.gov followed by a visit to the local USDA Service Center for identity verification.
Producers can also visit any USDA Service Center or their administratively assigned center to complete their 2009 DCP contract. There is a mandatory June 1, 2009 deadline for all participants. USDA has announced that it will not accept any late-filed applications.
The USDA is expected to begin ACRE signup this spring.
Thune also is urging producers who wish to receive any federal farm payments that will be considered 2008 calendar year income to visit their local FSA offices and complete all necessary paperwork by close of business on December 24th. Due to a new payment centralization process which has recently been put in place by USDA to minimize improper payments, county FSA offices no longer have the capability of writing paper or manual checks.
"If producers want 2008 income for any programs administered through their FSA offices they need to contact their local FSA office as soon as possible," said Thune.