Ag Policy Blog

Members of Congress Want Rule on Active Engagement

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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Six members of Congress have written Agriculture Secretary Tom Vilsack asking him to draft a new rule defining "actively engaged" for a person to receive farm-program payments. Lawmakers say there are cases of people being designated as management members of a corporate entity just to boost farm-program payments and get around the payment cap.

"This has enabled non-farming members to receive farm subsidies," the lawmakers wrote. "We hope that you will work to end these abuses."

The six lawmakers signing the letter were Sens. Charles Grassley of Iowa, Tim Johnson of South Dakota and Sherrod Brown of Ohio, as well as Reps. Rosa DeLauro of Connecticutt, Jeff Fortenberry of Nebraska and Earl Blumenauer of Oregon.

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"The point we are trying to get across to Secretary Vilsack is that the language in the farm bill allows the department to limit the number of people who can be designated as actively engaged per entity," Grassley told reporters on a weekly conference call. He added, "To give the farm bill respectability, ending the abuse of farm subsidies is one thing that we can do to make finding support for the bill much easier as we go into the future."

The letter points to a Government Accountability Office report in September 2013 that highlighted ways people subvert the definition of actively-engaged farmers. One entity had 22 limited-liability corporations that included 16 people just classified as 'active personal management only' on the farming operation. The GAO pointed out 27,486 entities used that loophole to collect $266,165,103 in farm payments in 2012. That breaks down to an average payment of about $9,683.

The members of Congress asked USDA to examine whether changes in active engagement would disqualify any elderly landowners who might otherwise qualify under current rules. The lawmakers also want to know how USDA would conduct compliance reviews and whether the 2014 farm bill put anything in place to restrict USDA's ability to change the rules.

Grassley and others sent Vilsack a letter regarding the definition of actively engaged. Congress didn't accept stronger language in the final version of the farm bill despite approval by both chambers of Congress.

The final farm bill set a payment cap at $125,000 per year per person or $250,000 for a married couple.

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