Ask FSA Andy about yearly reminders and notifications

Hello Again!

Happy New Year! We are all eagerly awaiting to see what 2016 has in store for us in the upcoming months. Will we keep our resolutions? Who will be our new President?

Before we get too far ahead of ourselves, let’s take a moment and look back to the holiday season that just came to an end. Going through my stack of mail I found some very educational information that I would like to share with you and I hope you will pass this information on to others. This information was derived from USDA, NASS “Agricultural Prices,” 2015.

The information provided the Farmer’s Share of Retail Food Dollar. Did you know that farmers and ranchers receive only 15.8 cents of every food dollar that consumers spend on food?

According to USDA, off-farm costs (marketing, processing, wholesaling, distribution and retailing) account for more than 80 cents of every food dollar spent in the United States.
This should make for interesting conversation at the next dinner table. Next week I will cover the other eight items that were provided.

Reminders

It is that time of year when we must provide you with yearly reminders and notifications. This week we are covering payment eligibility and payment limitation requirements. Do not fret over these provisions, as your local Farm Service Agency will gladly assist you with the paperwork and answer any questions you may have pertaining to these requirements.

Producers who participate in specific programs administered by the Farm Service Agency are subject to some or all of the following depending on the program:

• Payment limitation by direct attribution – per statute all entities/general partnership/joint operation must provide all members names, addresses, social security numbers and percent of shares.
• Payment limitation amounts for the applicable program — these vary by program
• Actively engaged in farming requirements
• Cash-rent tenant rule
• Foreign person rule
• Average Adjusted Gross Income (AGI) limitations
• Programs subject to AGI limitations
• Effective date of implementation of AGI limitation

No program benefits subject to payment eligibility and limitation will be provided until:

• All required forms for the specific situation are provided
• Necessary payment eligibility and payment limitation determinations are made.

Producers are not required to file a new farm operating plan (CCC-902) annually as long as the farming operation continues to be conducted as reflected on the latest farm operating plan filed in the county office. Some changes that may warrant the filing of a new farm operating plan include:

• Shares of a contract, which may reflect:
• A land lease from cash rent to share rent
• A land lease from share rent to cash rent (subject to the cash rent tenant rule)
• A modification of a variable/fixed bushel-rent arrangement
• The size of the producer’s farming operation by the addition or reduction of cropland that may affect the application of a cropland factor.
• The structure of the farming operation, including any change to a member’s share, adding additional members, going from an individual to an LLC, just to name a few.
• The contribution of farm inputs of capital, land, equipment, active personal labor, and/or active personal management.
• Farming interests not previously disclosed on CCC-902 including the farming interests of a spouse or minor child.

These changes must be reported to your local FSA timely and failure to do so may adversely affect payment eligibility. Please note that all information provided by you is subject to spot check through the end of year review process.

Programs subject to Adjusted Gross Income (AGI) provisions require the producer to sign a CCC-941, Average Adjusted Gross Income (AGI) Certification and Consent to Disclosure of Tax Information.

Noncompliance with AGI Provisions, either by exceeding the applicable limitation or by failure to submit a certification and consent for disclosure statement will result in the determination of ineligibility for all program benefits subject to AGI provisions; program benefits shall be reduced in an amount that is commensurate with the direct and indirect interest held by an ineligible person or legal entity in any legal entity, general partnership or joint operation that received benefits subject to the average AGI limitation.

Remember, if you have any questions or need to update your farm operating plan, please call or visit your local Farm Service Agency. Yearly notification and reminders to be continued in next week’s edition of Farm and Dairy.

We will also cover the final eight foods comparing what the farmer receives versus the retail cost.

That’s all for now,
FSA Andy