Sequestration hits farmers



By American Farm Bureau

Sequestration. We keep hearing about it, but now more than 300,000 farmers will be feeling it directly unless something changes. American Farm Bureau farm policy specialist Mary Kay Thatcher explains the situation in this story from AFBF’s Johnna Miller.

Miller: Sequestration is proving to have impact far and wide. Now it is hitting farmers, because the cuts apply to many of the programs run by the Agriculture Department’s Farm Service Agency.
Thatcher: Under the sequestration laws many of the programs under the Farm Service Agency will take a 5.1 percent cut. That includes things like direct payments, the Milk Income Loss Contract program, tobacco transition payments, the SURE program, Noninsured Assistance Program. So a wide variety, I think eight total FSA programs will all have to be cut by 5.1 percent.
Miller: But Agriculture Secretary Vilsack has informed Congress that he will have to deal with sequestration cuts to many farm programs by taking the money from just one. American Farm Bureau farm policy specialist Mary Kay Thatcher admits USDA does face a tricky situation.
Thatcher: All but the direct payment program have really no way for the secretary of ag to go back and recoup that 5.1 percent payment from them, because they were made before sequestration was mandated. So the secretary has decided instead to take an 8.5 percent cut in direct payments, which would be both what you owed in direct payments as well as making up for MILC, SURE, NAP, etc. The problem is you’re going to have some people who won’t have to pay back any of their sequestration cuts and some people who will get direct payments in October who are paying back more money than they actually owe. In fact, our indication is that farmers will pay probably $500 apiece more because of the way USDA has decided to implement this law.
Miller: And Thatcher says there has to be a better way.
Thatcher: We think it is unfair and we’re really concerned about the precedent. One of the things that has yet to be addressed at USDA is cuts in the Conservation Security Program. We certainly don’t want those coming out of direct payments. We don’t want them to come out of other conservation payments. I know it’s difficult over there, but we’ve encouraged the administration to try to think a little bit more outside the box and find some other way to do this than to penalize 315,000 farmers.

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