Direct payment reductions in lieu of paybacks

A story on DTN says USDA will reduce direct payments to all crop farmers this year rather than requiring some 350-thousand producers to refund a portion of payments they’ve already received through other programs. The 8.5 percent reductions are in lieu of $151 million that U.S. Ag Secretary Tom Vilsack previously stated would need to be paid back because of sequestration.

The payments were made under the Milk Income Loss Contract Program, the Supplemental Revenue Assistance Payments Program and the Noninsured Crop Disaster Assistance Program. More than 90-percent of the farmers who received payments under those programs also get direct payments.

The secretary suggested that the agency simply reduce direct payments by the amount the farmer would have had to pay back. A Farm Service Agency representative told DTN the agency is trying to carry out sequestration cuts with the least disruption to its customers.

All Farm Service Agency payment programs are subject to a 5.1-percent sequester cut.

The NAFB News Service contributed to this article.

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