Recent Press Releases

Thune's Efforts Successful USDA Agrees to Livestock Disaster Program Change

More South Dakota Livestock Producers Now Eligible for Disaster Assistance

December 3, 2007

Washington, D.C. —  Acting U.S. Department of Agriculture (USDA) Secretary Chuck Conner has informed U.S. Senator John Thune that the USDA would immediately modify an eligibility requirement for the Livestock Compensation Program (LCP). This policy change will make additional livestock eligible for disaster assistance.

Last week Senator John Thune sent a bipartisan letter (attached) signed by 24 U.S. Senators to Acting Secretary Conner requesting that the USDA make changes to LCP eligibility requirements to ensure that livestock producers who suffered legitimate feed losses were not arbitrarily excluded from receiving assistance.

A high percentage of South Dakota livestock operations occur in more than one county. USDA initially informed livestock producers who were applying for LCP assistance that livestock were required to be located in a disaster county on the first day of the disaster, in order to prove qualifying feed losses.

"The USDA's original rule meant that a cattle producer who wintered his livestock in Jones County, but owned or leased pasture in Jackson County, was not allowed to use the pasture loss in Jackson County to show a required feed loss, making that producer ineligible for LCP," said Thune. "This requirement made no sense whatsoever for thousands of livestock producers in South Dakota and most other Western grazing states."

Acting Secretary Conner told Senator Thune that as a result of his letter, state and county Farm Service Agency (FSA) offices had been informed via a teleconference call that they should immediately begin approving losses from the entire livestock operation, even if it covered multiple counties and the eligible livestock were located in only one county on the first day of the disaster period.

"The intent of Congress is that livestock producers who have waited more than two years in some cases for livestock assistance not be unduly burdened by eligibility requirements that would result in denying them much-needed assistance," Thune commented. "I am pleased that USDA made this policy change which was foremost on our list in last week's letter signed by 23 of my Senate colleagues. I will continue to work with USDA on other implementation policies to ensure that South Dakota livestock producers receive their long-awaited disaster assistance."

Senator Thune has been working throughout the year to ensure that USDA is correctly administering the $3.2 billion disaster assistance that Congress passed this spring. For instance, this summer Senator Thune introduced a bill (S. 1716) that was passed by both the U.S. Senate and House and signed into law by the President. This particular bill struck a provision of the disaster statute, which according to USDA's interpretation would have required all livestock producers to have purchased forage insurance in order to qualify for livestock disaster assistance. Fewer than 15 percent of the nation's livestock producers had purchased the ineffective Non-insured Assistance Program insurance, which was the only insurance available, nationwide. Thune's legislative fix was especially important to South Dakota producers due to the multiyear drought that has impacted our region.
Senator Thune also introduced legislation (S. 2012) this summer, which would extend crop and livestock disaster assistance to cover losses that occur through the end of calendar year 2007. The current statute covers natural disaster losses only through February 28, 2007.

November 28, 2007

The Honorable Chuck Conner
Acting Secretary of Agriculture
1400 Independence Avenue Southwest
Washington, DC 20250

Dear Acting Secretary Conner:

The purpose of this letter is to express our concern regarding implementation of the Livestock Compensation Program (LCP) authorized by P.L. 110-28, The U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act of 2007.

According to current LCP procedure the Farm Service Agency (FSA) has issued for the purpose of conducting sign-up, the U.S. Department of Agriculture (USDA) has made livestock eligibility and other policy determinations which very clearly are not in accordance with the intent of Congress.

We are disappointed that the U.S. Department of Agriculture (USDA) has chosen to effectuate very restrictive, unnecessary, and administratively cumbersome LCP implementation policies that would result in producer ineligibility for millions of dollars authorized by Congress under P.L. 110-28 to assist producers who suffered legitimate livestock losses in 2005, 2006, and part of 2007. We find this current USDA LCP policy unacceptable.

Three issues of concern regarding LCP implementation have been brought to our attention:
  1. Livestock ineligibility due to livestock not being physically located in a declared or contiguous county after the beginning date of the eligible disaster (Attachment 1, Issue #1); and

  2. Livestock physically located in a declared or contiguous county on the beginning date of the disaster, but determined ineligible due to USDA-perceived producer intent as to the disposition of the livestock (Attachment 1 Issue #2).

  3. Reduction in payment amount due to the FSA County Committee setting inaccurate maximum loss caps.

The statute (P.L. 108-28) specifically outlines the intent of Congress for USDA to implement the LCP for 2005, 2006, and 2007 losses.

Section 9002 provides that the Secretary shall ".carry out the livestock compensation program established under part 1416 of title 7, Code of Federal Regulations, as announced by the Secretary on February 12, 2007 (72 Fed. Reg. 6444)." The statutory mandate is for USDA to carry out a livestock compensation program (LCP), not in the "same manner" as is the mandate

for the crop disaster assistance - which references 2001 statute, because the LCP referenced in 7 CFR part 1416 included specific requirements that applied only to hurricane-related damages and losses. The damages and losses that Congress intended to be covered under the LCP authorized under P.L. 108-28 are for multiple natural disasters, predominately long-term drought.

The following statutory guidelines provided in P.L. 110-28 govern administration of LCP:

The last sentence of Section 9002 (a)(1) provides: "In addition, section 1416.102(b)(2)(ii) of Title 7, Code of Federal Regulations (72 Fed. Reg. 6444) shall not apply.

  • Section 1416.102(b)(2)(ii) of title 7 of Code of Federal Regulations (72 Fed. Reg. 6444) provides:

    "(b) To be considered an eligible livestock producer, a producer must have: (2) suffered a loss of feed: (ii) the value of such loss, as determined by CCC, equals or exceeds the amount calculated according to (Sec. 1416.104(a.) LCP payments are calculated by multiplying the national payment rate for each livestock category, as provided in paragraph (c) of this section, by the number of eligible livestock in each category. The national payment rate represents the cost of the amount of corn needed to maintain the specific livestock for 30 days, as determined by CCC. Adjustments shall be applied in accordance with paragraph (b) of this section and Section 1416.105; (b) The LCP payment calculated in accordance with the paragraph (a) of this section shall be reduced by the amount the applicant received for the specific livestock under the Feed Indemnity Program in accordance with subpart D of part 760 of this title."

    Section 1416.105 applies to the $95 million appropriated for previously authorized programs, therefore it does not apply to this disaster program.

According to the statutory provision referenced above (last sentence of Section 9002 (a)(1)), the referenced subparagraph of the regulation (section 1416.102(b)(ii) shall not apply). Accordingly, it is Congress' intent that the requirement in the LCP regulation that a feed loss must occur as an LCP eligibility requirement no longer applies.

Section 9002, Subparagraph (a)(2)(A) provides that, "In carrying out the program described in paragraph (1), the Secretary shall provide assistance to any applicant that conducts a livestock operation that is located in a disaster county with eligible livestock specified in paragraph (1) of section."

According to this provision an eligible applicant must conduct a livestock operation that is located in a disaster county with eligible livestock specified in paragraph (1) of section 1416.102(a).
Section 9002, Subparagraph (B) requires that an eligible applicant must meet the requirements of (3) and (4) of section 1416.102(a) of the regulation.

According to this provision, livestock must meet the following requirements: "(3) been maintained for commercial use as part of a farming operation on the beginning date of the disaster period; and (4) Not have been produced and maintained for reasons other than commercial use as part of a farming operation."

It is important to note that the statute (P.L. 110-28) specifically omits any reference to 7 CFR Section 1416.102 (a)(2) which provides that livestock must have, ".been physically located in an eligible county on the beginning date of the disaster period..." Accordingly, this omission clearly indicates that the intent of Congress is that subparagraph, 7 CFR Section 1416.102 (a)(2), shall not apply as an eligibility requirement for the implementation of the LCP.

It is the intent of Congress that the USDA would modify or exclude certain mandates in the regulation governing specific hurricane-related disaster programs. Sufficient legal authority exists for USDA to administer the livestock programs in the 2005-2006-2007 ad hoc disaster programs with policies that are germane to and make sense for non-hurricane long-term disasters such drought.

Regarding Issue 3, above, we are concerned that FSA County Committees are establishing average feed and grazing losses rather than maximum grazing losses in eligible counties. County Committees have the responsibility to establish maximum grazing losses in each county and to reduce loss amounts for applicants from areas of a county with smaller losses who attempt to obtain assistance based on maximum loss thresholds established for the county.

Additionally, we request that you provide us with legal authority that would preclude livestock being housed in feedlots from being eligible for LCP, provided all other eligibility requirements are met.

We respectfully request that USDA consult with us prior to publishing the regulation governing the 2005-2006-2007 livestock disaster programs authorized under P.L. 110-28 to ensure that the intent of Congress is carried out in administering these programs that are critical to the economic health of livestock producers who have suffered losses due to natural disasters.

In summary, we respectfully request that you reexamine the current implementation policies for the LCP and that prior to publishing the regulation governing this program that you meet with us to discuss and understand the intent of Congress to provide much-needed assistance to the livestock producers who suffered damages and losses due to natural disasters in 2005, 2006, and 2007.