Farm payments policing inadequate

WASHINGTON – The USDA isn’t adequately policing recipients of federal farm program payments, according to a General Accounting Office report released June 10.

‘Actively engaged.’ “The report says the ag department doesn’t have measurable standards to ensure that recipients are actively engaged in farming,” said Iowa’s Sen. Charles Grassley.

The Farm Program Payments Integrity Act of 1987 limits payments to individuals and entities, such as corporations and partnerships. Recipients are to be persons who are actively engaged in the operation beyond “making a couple of phone calls,” Grassley said.

The USDA said it believes current regulations are sufficient for determining active engagement in farming.

Within the USDA, the Farm Service Agency is responsible for enforcing the payment limitation rules.

The beef. The report’s main focus was the lack of measurable standards for “significant contribution.” And for about one-half of the farming operations GAO reviewed for 2001, field offices did not use all available tools to determine whether people were actively engaged in the farm operation.

A person can be involved in only three entities and receive up to $360,000 in payments.

Internal check. In 2001, the Farm Service Agency reviewed 347 of 247,831 entities receiving payments. Nearly 5 percent were identified as having members who did not qualify with the actively engaged requirement.

The GAO said the total noncompliance is unknown because the FSA is not reviewing valid samples of farming operations receiving payments.

Numbers not all in. Furthermore, only nine of 38 FSA state offices had completed compliance reviews and reported results to the FSA by March 31, 2003.

Six states had not begun compliance reviews by the summer of 2003 – Arkansas, California, Colorado, Louisiana, Ohio and South Carolina.

The GAO recommended the USDA clarify guidelines in determining what constitutes fraudulent intent in order to collect greater payments.