Sign-up deadline is June 1

Farmers have until June 1 to sign up and enroll in the 2010 USDA farm program. That’s the deadline for the traditional program, the 2010 Direct and Counter-cyclical Payment program, also known as DCP. It’s also the deadline for the Average Crop Revenue Election, or ACRE, program, an option that was first available last year.

This year’s deadline is earlier than last year’s, and sign-up is lagging. Don’t wait until the last minute to make your decision. Contact your local Farm Service Agency office as soon as possible to set up an appointment well before June 1. USDA officials say they will not accept any late-file applications.

The following answers are provided by Kevin McClure, state program specialist for USDA’s Farm Service Agency in Des Moines. For more information or answers to specific questions, visit your local FSA office or www.fsa.usda.gov.

Question: What do I need to bring to the FSA office to sign up?

Answer: You don’t have to bring in specific items to complete the enrollment process, but there are some forms to be signed. Farmers who rent farms on crop share need to obtain signatures of additional producers on the farm, including landowners, for the DCP/ACRE contracts. Farmers who cash rent have a few options for securing landowner signatures.

Cash renters can take the DCP/ACRE contract to the landowners and have them sign it. Or, the farmer can have the landowners write and sign a cash-rent statement for the 2010 crop year and then provide that signed statement to the county FSA office. A third option is the farmer can provide a copy of the written lease to FSA. It must specifically state it is for the 2010 crop year.

If the farmer has an FSA power of attorney form signed and on file at the FSA office, then the farmer can sign the DCP/ACRE contract on the landowner’s behalf.

Question: I signed up for DCP in 2009, and also enrolled in ACRE. Do I need to sign up for DCP in 2010?

Answer: If you were in DCP last year and then elected to enroll in ACRE, you’re already in ACRE. Once you elect to be in ACRE, you’re in it through 2012. But you still have to sign up or enroll annually for DCP and ACRE at the county FSA office. For farms where the ACRE election was completed in 2009, you don’t have to complete the election again, but you must complete the DCP/ACRE enrollment on the farm for 2010 by the June 1 deadline.

ACRE was created in the 2008 Farm Bill to help farm owners and operators manage revenue risk and move away from subsidies based primarily on price. ACRE is not a guaranteed payment; the revenue loss is based on both price and yield. The annual shortfall in revenue must be met at both the state level and the farm level to trigger a potential ACRE payment.

If you haven’t yet elected ACRE, you can choose to elect it in 2010 or to continue in the traditional DCP program only. Farmers who choose ACRE must give up 20% of their direct payments and all countercyclical payments. ACRE participants continue to be eligible for marketing loans, but their loan rates are reduced by 30%.

You must enroll all eligible crops in an FSA farm unit into either DCP or ACRE. Once ACRE is elected, the choice applies to all subsequent years covered by the 2008 Farm Bill (2009 through 2012) because once the farm elects ACRE, ACRE remains with the farm through 2012.

ACRE payments are calculated on a crop-by-crop basis at state level. If actual state revenue falls below the state revenue guarantee, then all farmers who have signed up for ACRE are potentially eligible for payments. All these potentially eligible farmers who also suffer a farm loss will receive an ACRE payment.

Question: What about direct payments?

Answer: USDA computes DCP payments using base acres and payment yields established for each farm. Farmers get direct payments at rates set by statute regardless of market prices. For 2010, eligible farmers may request to receive direct payments in advance based on 22% of direct payment rate for each commodity on the farm.

In January 2010, USDA began issuing DCP and ACRE direct advance payments for the 2010 program year. Countercyclical payment rates vary depending on market prices. Counter-cyclical payments are issued under the DCP program and are only made when the effective price (taking into account direct payment rate, market price and loan rate) for a commodity is below its target price.

This article published in the April, 2010 edition of WALLACES FARMER.

All rights reserved. Copyright Farm Progress Cos. 2010.