Minding Ag's Business
Marcia Zarley Taylor DTN Executive Editor

Tuesday 03/09/10
SURE Claims Short Circuit

Even the government computers that run critical air traffic control systems are antiques of the digital age. So it's no surprise that Farm Service Agency computer snafus are short circuiting during the debut of SURE, the government's new permanent disaster program that is based on calculations of whole farm revenue.

The aid is no chicken feed: Growers may collect payments worth $50 to $100 per acre in parts of Iowa for their 2008 revenue "disaster," some land grant economists estimate, but it won't be without pain, suffering and long delays at FSA offices.

"This is such a mess that it is indescribable and it is going to get worse before better," one county FSA director e-mailed an Iowa grower last week. He warned it might take more than three weeks just to get an appointment to run the revenue calculations for his farm.

In Dickey County, N.D., farmer Bart Schott reports that his local computers have crashed and that some initial payments had to be recalculated because growers were overpaid. That's problematic since many local FSA offices were already understaffed. "2008 turned out to be a decent income year for us, so I personally wasn't going to sign up until I heard how larger payments were," Schott said.

In an interview with DTN at Commodity Classic last week, FSA Administrator Jonathan Coppess blamed delays on computer issues and noted that FSA employees must manually enter data on spreadsheets to determine if growers are eligible for payments. "Administering this in a modern age is a challenge," he said, although growers had already received $65 million since Jan. 4.

Sheer numbers of potentially eligible farmers add to the waits. To be eligible, growers must farm in a county declared a disaster, or adjacent to one. But that makes 83 percent of all counties in the U.S. geographically qualified, Coppess said.

In general, SURE is a whole farm revenue insurance guarantee for crop producers--the first time Congress designed a disaster program on total farm revenues rather than yield losses. It requires FSA offices to collect insurance records from the Risk Management Agency, even though the two USDA agency computers don't talk the same language. What's more it's collecting data on a lot of specialty crops that fell under the radar in the past.

Is SURE too complex to administer? Coppess said no. "You need RMA and FSA to communicate better. We've got employees out there doing calculations on a spreadsheet," he said. "It's a hard slog to do it.

"Complexity is here to stay in farm programs," he added. "We need to figure out how to implement and administer it, despite some of that complexity."

For calculators and more information on SURE, go to your county office or www.fsa.usda.gov. And let me know about your experience.

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Posted at 7:07PM CST 03/09/10 by Marcia Zarley Taylor
Comments (4)
If someone has an insurance claim in a disaster year, does this some what eliminate them from being eligible for a SURE payment, because the insurance clain is considered in the farm revenue total?
Posted by PRESTON ARRINGTON at 9:06PM CST 03/10/10
preston, i had about a 33% of normal yeild. it looks like i will receive a sure payment of about 10% of my crop insurance payments. of course that was before some of the adjustments that had to be made after the initial applications were run, so i'm not sure (pun intended) where it will all finish up.
Posted by Larry Jones at 10:55PM CST 03/10/10
Marcia, There are several points that may need to be shared that makes SURE significantly more complicated for FSA to administer if a producer is actually eligible for a SURE payment. You touched on it briefly where FSA has to load information manually to calculate total ‘farm revenue’ using information sent to FSA from RMA. Those download reports vary from 4 pages to 40 pages per producer. It includes reported acres (by field & subfield), APH data, premiums paid, guarantee levels, units, NAP & CAT buy-in data, coverage types, location codes, DCP & Counter-cyclical payments received, production to count, etc… The previous year’s crop disaster program downloads were quite simple and reflected APH and the indemnity issued to the producer, so it was quite obvious who would be eligible for the CDP payments. After looking and highlighting eligible producers on a single download (4 to 7 producers per page) we would issue a letter letting them know they might be eligible for a CDP payment and call our office and make an appointment. I think we were 99% effective (no money left on the table). We can’t do that with this new format. Our biggest challenge is getting farmers to visit the office and make application. The irony is that many had yield losses exceeding the minimum 10%! I guess because it involves 2008 and they received decent prices despite the yield loss the guys are not thinking they would have a chance to be eligible. The National Average Market Price (NAMP) is $4.06 for corn and $9.97 for soybeans…… these guys need to get to FSA and get the fact sheet that contains the manual worksheet and plug their numbers in. They might discover a surprising SURE payment. We won’t know if they are eligible for a SURE payment until they come in and ask. I’m guessing we should have about 70-75 farmers eligible for SURE for 2008 crop losses, …if they ever come in. However, I know 2009 will be a far greater number. --From an Illinois FSA County Director
Posted by Marcia Taylor at 2:46PM CST 03/12/10
After meeting with Iowa corn farmers last week, I have to say that they are a little embarrassed at the size of their payments, especially since 2008 wasn't a disastrous year for most. They worry about more negative publicity once word gets out. This reminds me why crop insurance remains the most defensible type of aid for revenue disasters. I know this won't go down well with all of you, but why do we need a disaster program anyway?
Posted by Marcia Taylor at 3:36PM CDT 03/14/10
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