Status Date for Participation in USDA Crop Programs

Monday, February 18, 2008
Contributed by: Alan Rhodes

Over the past several months we've been involved with a number of dairy farmers who have expanded their holdings of farmland capable of producing forage. Based on the transactions and information that we've seen, land purchases allow the dairies to control their feed costs. The land purchases also facilitate nutrient management.

The land acquisitions may cause many dairy farmers to hold land with payment eligibilty that exceeds the payment limitations for direct and/or countercyclical payments. With some planning, it is possible for the farmers and their associated businesses to retain or increase the farm program payments for which their land holdings are eligible.

The current uncertainty of the farm bill may have caused many farmers to avoid addressing payment limitation questions for 2008. Certainly, questions about the farm bill remain present. The anticipated five year farm bill may include changes in person eligibility by the elimination of the three entity rule. In addition, the anticipated farm bill may lower the adjusted gross income limitation on participation in USDA crop programs.

Traditionally, FSA requires farmers to have their farming operation organizational structure in place by the April 1 status date, and we recommend that any planned restructuring be completed prior to April 1. It's possible that the status date could be extended for 2008 because of the delay in passage of the farm bill. As additional information is available concerning the status date, we'll add it to this site.

Alan Rhodes, Lynn Tate, and Courtney Goodman-Morris are familiar with the status date rules and the substantive change rules.

This column is published for informational purposes only. It should not be construed as legal advice and is not intended to create an attorney client relationship. The views expressed are those of the author and do not necessarily reflect the views of the author's law firm or its individual partners.