New programs trigger important decisions

Managing Editor

CENTREVILLE, Md. — School was in session on the new Farm Bill last week with area farmers hearing about some of the decisions they’ll have to make to comply with new programs.
In a two-week stretch of six workshops across the state, University of Maryland Extension staff and experts from USDA’s Farm Service Agency zeroed in on commodity or dairy programs depending on the dominant crops in that area. The series wraps up with two workshops this week on Aug. 19 in Frederick and Aug. 21 in Garrett County, both focusing on dairy programs.
Bob Wevodau, Maryland FSA’s farm program chief first told the more than 100 farmers crowded into a meeting room at the Queen Anne's County 4-H Park last week that the average Adjusted Gross Income level that determines eligibility for most Farm Bill programs was set at $900,000 using the three previous tax years and includes non-farm income and farm income. Previous AGI eligibility levels varied depending on several factors, Wevodau said.
“This is a lot more simplified” for FSA staff and hopefully for farmers, Wevodau said.
The workshops focused on commodity programs centered around the Agricultural Risk Coverage and Price Loss Coverage programs that replaced the Direct and Counter-Cyclical Program and the Average Crop Revenue or ACRE program in the 2014 Farm Bill.
Farmers who enroll in the new ARC or PLC programs have a one-time opportunity to re-allocate their base acres from one covered commodity to another.
Farmers can’t increase their base acres, only shift existing base acres, Wevodau said.
A deadline has not been set yet for farmers to decide on re-allocating base acres, Wevodau said, but it is anticipated to be near the end of 2014 or the beginning of 2015.
USDA is mailing letters detailing the base reallocation decision to farm owners nationwide and Wevodau said farmers have 60 days to check that the letters accurately list how their base acres are allocated and notify FSA of any problems.
“If you have any errors or omissions on it, you need to get with your county office,” he said.
Farmers also have the opportunity to update their program yields which payments are based on.
Howard Leathers, University of Maryland associate professor for agriculture economics, told the group they should update yields if the yields  have gone up.
“I don’t see anyway you can go wrong in updating higher program yields,” Leathers said.
Farmers will have to make another choice on which new commodity program best fits their operation.
The PLC program triggers a payment when the price of a covered crop falls to a certain level while the ARC program triggers a payment when revenue on a crop drops too far. In the ARC program farmers have the  choice of using county yields or their individual yields.
The decisions are important and long-lasting, Wevodau said, so farmers should be sure they understand their options.
“Whatever you pick you’re going to be married to it for the life of the Farm Bill,” Wevodau said.
After working through examples of each program option, Wevodau said state and county FSA staff still have to go through trainings on how to administer the new programs and calculation tools for determining what a program payment might be are in development, so there will be time for famers to get a better handle on what will work best for them.
“Don’t panic if you feel confused, there’s still time,” Wevodau said. “More information will come out about this. This is your introduction. This is not your final class.”