FSA Administered Programs
Helps agricultural producers, their lenders, and other persons directly affected by the actions of USDA resolve disputes. Through mediation, a trained, impartial person (mediator) helps participants review their conflicts, identify options, and agree on solutions. Mediation is a valuable tool for settling disputes in many different USDA program areas. These include farm loans, farm and conservation programs, wetland determinations, rural water loan programs, grazing on national forest system lands, and pesticides usage. The program is authorized through 2005 by the Agricultural Credit Act of 1987
The Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs were authorized by the 2014 Farm Bill combine provisions from previous programs delivered by the Farm Service Agency (FSA) (the counter-cyclical portion of the Direct and Counter- Cyclical Program, the Supplemental Revenue Assistance Payments Program and the Average Crop Revenue Election Program) with revenue insurance delivered by the Risk Management Agency.
Owners must make a one-time election to reallocate crop bases, update program payment yields and producers select the type of coverage (price protection, county revenue protection, and/or individual revenue protection) for crop years 2014-2018.
A type of farm ownership loan made to eligible applicants to finance a portion of a real estate purchase. The statutory authority for beginning farmer down payment loans is section 310E of the Consolidated Farm and Rural Development Act.
The Conservation Reserve Program (CRP) provides a voluntary program to agricultural producers to help them safeguard environmentally sensitive land. Producers enrolled in CRP plant long-term, resource-conserving covers to improve the quality of water, control soil erosion, and enhance wildlife habitat. In return, CCC provides participants rental payments and cost-share assistance. Contract duration is between 10 and 15 years. CRP was authorized by section 1231 of the Food Security Act of 1985, as amended.
As the name implies, this program is an enhanced version of the very successful Conservation Reserve Program (CRP). CREP is a special conservation program that allows the CRP to be tailored to meet the needs of the State. CREP is a Federal-State conservation partnership program that targets significant environmental effects related to Agriculture.
A loan made to eligible applicants to purchase, enlarge, or make capital improvements to family farms, or to promote soil and water conservation and protection. Maximum loan amount is $300,000. A percentage of direct farm ownership loan funds is targeted for beginning farmers and underserved applicants as mandated by sections 346 and 355 of the Consolidated Farm and Rural Development Act (Pub. L. 87-128) (CONACT) (7 U.S.C. 1994 and 7 U.S.C. 2003), respectively. The statutory authority for direct farm ownership loans is section 302 of the CONACT.
A loan made to an eligible applicant to assist with the financial costs of operating a farm. Maximum loan amount is $300,000. A percentage of direct operating loan funds is targeted for beginning farmers as mandated sections 346 and 355 of the Consolidated Farm and Rural Development Act (Pub. L. 87-128) (CONACT) (7 U.S.C. 1994 and 7 U.S.C. 2003), respectively. The statutory authority for direct operating loans is section 311 of the CONACT.
The Emergency Conservation Program (ECP) provides emergency funding for farmers and ranchers to rehabilitate farmland damaged by wind erosion, floods, hurricanes, or other natural disasters, and for carrying out emergency water conservation measures during periods of severe drought. The natural disaster must create new conservation problems, which, if not treated, would: impair or endanger the land; materially affect the productive capacity of the land; represent unusual damage which, except for wind erosion, is not the type likely to recur frequently in the same area; and be so costly to repair that Federal assistance is, or will be, required to return the land to productive agricultural use. Authorized by section 401 of the Agricultural Credit Act of 1978 (Pub. L 95-334) as amended by the Disaster Assistance Act of 1989.
The program provides emergency assistance to eligible producers of livestock, honeybees and farm-raised fish. It covers losses due to an eligible adverse weather or loss condition, including blizzards and wildfires, as determined by the Secretary. ELAP covers losses that are not covered under other Disaster Assistance Payment programs authorized by the 2014 Farm Bill; such as the Livestock Forage Disaster Program (LFP) and the Livestock Indemnity Program (LIP).
Loans are available to eligible applicants who have incurred substantial financial losses from a disaster. Maximum outstanding loan amount is $500,000. The statutory authority for emergency loans is section 321 of the Consolidated Farm and Rural Development Act.
The Farm Storage Facility Loan (FSFL) program provides eligible producers of eligible commodities with low-interest financing to build or upgrade farm storage and handling facilities.
The maximum principal amount of an FSFL loan is $500,000. Participants are required to provide a down payment of 15 percent, with CCC providing a loan for the remaining 85 percent of the net cost of the eligible storage facility and permanent drying and handling equipment. Loan terms of 7, 10, or 12 years are available depending on the amount of the loan. Final disbursement of the loan will be made when all construction is completed. Applications for FSFL must be submitted to the FSA Parish Office that maintains the farm’s records. An FSFL must be approved before any construction can begin.
Producers must substantiate creditworthiness, the ability to repay, and eligibility for the desired storage capacity based on their share of the planted acreage of the commodities to be stored. The producer must provide security for the loan. FSFL’s are considered to be adequately secured when the value of real estate security, before installing the requested FSFL structure, is at least equal to the FSFL amount. For loans over $50,000, unless another form of security is received, producers are required to pay for an appraisal, as arranged by FSA, for the real estate and any improvements such as existing bins, with no guarantee that the loan will be approved. Loans are also available to build cold storage facilities and bans for eligible commodities.
A loan made by another lender and guaranteed by FSA to eligible applicants to purchase, enlarge, or make capital improvements to family farms, or to promote soil and water conservation and protection. Maximum loan amount is $1,399,000 (for FY 2015). A percentage of guaranteed farm ownership loan funds is targeted for beginning farmers as mandated by sections 346 and 355 of the Consolidated Farm and Rural Development Act (CONACT) (Pub. L. 87-128) (7 U.S.C. 1994 and 7 U.S.C. 2003), respectively. The statutory authority for guaranteed farm ownership loans is section 302 of the CONACT.
A loan made by another lender and guaranteed by FSA to an eligible applicant to assist with the financial costs of operating a farm. Maximum loan amount is $1,399,000 (for FY 2015). A percentage of guaranteed operating loan funds is targeted for beginning farmers as mandated sections 346 and 355 of the Consolidated Farm and Rural Development Act (Pub. L. 87-128) (CONACT) (7 U.S.C. 1994 and 7 U.S.C. 2003), respectively. The statutory authority for guaranteed operating loans is Section 311 of the CONACT.
A loan available to Indian tribes for purchasing privately held lands within their respective reservations boundaries. The statutory authority for Indian Tribal Land Acquisition loans is Pub. L. 91-229.
LIP provides compensation to eligible livestock producers that have suffered livestock death losses in excess of normal mortality due to adverse weather or attacks by animals reintroduced into the wild by the Federal government or protected by Federal law. Producers who suffered livestock death losses should submit a notice of loss and application for payment to their local FSA office by no later than January 30, 2015. Producers must provide documentation of beginning inventory of the animals and documentation to prove the number and kind of livestock that died, supplemented if possible by photographs and proof of ownership records.
LFP provides compensation to eligible livestock producers that have suffered grazing losses due to drought on privately owned or leased land, or fire on federally managed land. Eligible producers must physically be located in a county affected by qualifying drought during the normal grazing period for the county. For the County to qualify for these benefits, some portion of the county must have been rated on the U. S. Drought Monitor at a level of at least D2 for 8 consecutive weeks, or a D3 or higher at any time during the grazing period.
The Margin Protection Program for Dairy (MPP) is a voluntary risk management program for dairy producers authorized by the Agricultural Act of 2014 (2014 Farm Bill) through Dec. 31, 2018. The MPP-Dairy offers protection to dairy producers when the difference between the all milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer.
The Noninsured Crop Disaster Assistance Program (NAP), reauthorized by the 2014 Farm Bill and administered by the U.S. Department of Agriculture (USDA) Farm Service Agency (FSA), provides financial assistance to producers of non-insurable crops to protect against natural disasters that result in lower yields or crop losses, or prevents crop planting.
An eligible producer is a landowner, tenant or sharecropper who shares in the risk of producing an eligible crop and is entitled to an ownership share of that crop. The 2014 Farm Bill specifies that an individual or entity’s average adjusted gross income (AGI) cannot exceed $900,000 to be eligible for NAP payments.
Eligible crops must be commercially produced agricultural commodities for which crop insurance is not available and be any of the following:
NAP provides catastrophic level (CAT) coverage based on the amount of loss that exceeds 50 percent of expected production at 55 percent of the average market price for the crop. In addition, the 2014 Farm Bill authorizes additional coverage levels (buy-up) ranging from 50 to 65 percent of production, in 5 percent increments, at 100 percent of the average market price. Additional coverage must be elected by a producer by the application closing date. Producers who elect additional coverage must pay a premium in addition to the service fee. Crops intended for grazing are not eligible for additional coverage.
Eligible producers must apply for coverage using form CCC-471, “Application for Coverage,” and pay the applicable service fee at the FSA office where their farm records are maintained by the application closing date established the FSA State Committee.
Provide producers interim financing at harvest time without having to sell their commodities when market prices are typically at harvest-time lows. Allowing producers to store production at harvest rather than immediately selling facilitates more orderly marketing of commodities throughout the year. Marketing assistance loans for covered commodities are nonrecourse because the commodities are pledged as loan collateral and producers have the option of delivering the pledged collateral to CCC as full payment for the loan at maturity. For loans disbursed in August 2012 the interest rate is 1.25 percent.
Marketing assistance loans and loan deficiency payments (LDPs) are authorized for the 2012 crop year. Commodities eligible for loan or LDP, whether or not they are produced on a participating or nonparticipating farm are Wheat, Oats, Peanuts, Small Chickpeas, Rice, Corn, Honey, Barley, Soybeans, Grain Sorghum, Dry Peas, Sunflowers and Other Oilseeds, Cotton, Wool, and Lentils.
Hay and silage derived from the above commodities and unshorn pelts are eligible for LDP, but not for marketing assistance loan. Sugar is eligible for a regular loan, but is not for market gain or LDP. In addition, producers who graze wheat, oats, barley, and triticale are eligible for an LDP-like Graze-Out payment, if the crop is grazed out by livestock and not mechanically harvested. Graze-Out payments only apply at times when an LDP is available on the applicable commodity. As of the date of August, 2012, there are no LDP rates in effect for any commodities.
To be eligible for loans and LDPs, producers must: 1) Certify planted acreage for all crops and account for all cropland; 2) Have beneficial interest in the commodity; 3) Comply with Highly Erodible Land Conservation/Wetland Conservation Provisions (HELC/WC); 4) Comply with Adjusted Gross Income Provisions; 5) Not owe a delinquent nontax federal debt - Once the debt is resolved, the producer is eligible to participate; 6) Not violate controlled substance provisions.
States, local government, political subdivisions, and agencies thereof, are no longer eligible to receive loans or LDPs. (For example, school boards, levee boards, universities and prisons are not eligible.)
Beneficial Interest Requirement
For a commodity to be eligible for a loan or LDP, the producer must have beneficial interest in the commodity. Beneficial interest means the producer has complete control and title to the commodity. Once beneficial interest is lost, the commodity is ineligible for loan and LDP, even if beneficial interest is regained. For loans, producers must maintain beneficial interest either through the date the commodity is redeemed from loan or Commodity Credit Corporation (CCC) takes title to the commodity. For LDPs, beneficial interest must be maintained through the date the CCC-633 EZ, Page 1 is signed or the date LDP is requested.
All producers and landowners who share in the proceeds of the crop are encouraged to sign Form CCC-633EZ, Page 1 prior to harvest. Signing of this form prior to harvest protects a producer or landowner if loan or loan deficiency payment (LDP) benefits are not requested prior to loss of beneficial interest. Signing of the form does not take away any option that is available to request a commodity loan or an LDP.
All commodities pledged for CCC loan must be free and clear of all liens, judgments, and other encumbrances. If not, lien waivers must be provided. Commodities pledged for CCC loan must be stored in approved on-farm storage or in State or Federally approved warehouses willing to store the commodity for the loan period and issue a warehouse receipt.
Producers are responsible for maintaining the storability and quality of commodities stored on the farm. Additionally, producers MUST request an authorization from FSA PRIOR to MOVING, delivering to buyers, selling, or feeding commodities mortgaged to CCC. Severe penalties apply for non-compliance with this requirement.
Loan rates and interest rates are available upon request at any Parish FSA Office or on the internet at Loan Rates and Interest Rates and LDP Rate online. The loan and LDP rate for commodities grown on farms enrolled in the ACRE program will be reduced by 30%.
Loan Deficiency Payments (LDPs)
LDPs are payments made to producers who, although eligible to obtain a CCC loan, agree to forgo the loan in return for a payment on the eligible quantity. They are only available when the “CCC-determined value” falls below the loan rate for the commodity.
Locking in Repayment Rates
Producers with outstanding Commodity Credit Corporation (CCC) loans, whether farm-stored or warehouse-stored, may “lock-in” the repayment rate by completing Form CCC-697. The locking-in of the repayment rate is allowed for all commodities except cotton. Also, for warehouse stored loans, the request to lock-in the repayment rate must cover entire warehouse receipt quantities.
The CCC-697 (lock-in) expires the earlier of 60 days after it is executed, or 14 days before the loan matures. Specific quantities of a commodity can be “locked-in” only once. For specific quantities locked-in and not repaid during the lock-in period, the repayment rate for that specific quantity cannot be locked-in again. The repayment rate will be based on the date funds are received to repay the loan.
Sugar Loan Program and Sugar Marketing Allotments
The Sugar Loan Program provides nonrecourse loans to processors of domestically grown sugarcane and sugar beets. This program helps to stabilize America’s sugar industry and ensure the well being of agriculture in the United States.
At the beginning of each fiscal year, CCC will establish marketing allotments for domestically produced sugar from sugar beets and domestically produced sugarcane. The Secretary will strive to establish an overall allotment quantity that results in no forfeitures of sugar to CCC under the sugar loan program. The Secretary shall make estimates of sugar consumption, stocks, production, and imports for a crop year as necessary, but not later than the beginning of each of the second through fourth quarters of the crop year. Prior to the beginning of the fiscal year, these estimates must be updated.
Provides operating type loans to eligible rural youth applicants to finance a modest income-producing agricultural project. Maximum loan amount is $5,000. The statutory authority for youth loans is section 311 of the Consolidated Farm and Rural Development Act