Dear Readers,

Annette Higby from Sustainable ag network asked me to share this corrected information with you regarding  subsidy payments for large farms. This information is just to share, you are free to comment how you like and if you wish. There is a note that today is the last day for comments.

The sample comment letter regarding the payment limitations/actively engaged action alert posted to our website last week included a corrupted email address for Dan McGlynn.  The correct email address is:  [log in to unmask]">[log in to unmask]

We've also had reports of emails bouncing even when using the correct address.  If you have problems submitting your comment there are two different options for getting your message to USDA: 


Send Dan McGlynn a letter by fax to 202-690-2130, or

 Go to  Select the small box for "find documents accepting comments and submissions."  Type "farm program payment limitation" in the search box and then click "Go".   The first document listed will be the proposed interim rule on farm program payment limitations titled "Farm Program Payment Limitation and Payment Eligibility for 2009 and Subsequent Crop, Program, or Fiscal Years."  Choose, "Send a comment or submission."  Then follow the directions on the comment submission form and submit your comment. 


This is the LAST DAY to submit your comments.  Help us send a loud and clear message that we want the worst farm subsidy loophole on the books closed!

Thank you for taking action on this important issue! 

Talking Points: 

Here are some points to pick and choose from and put in your own words in your email or letter to USDA:

  • The biggest of all payment limitation loopholes allows large farms to find multiple “partners” to fulfill the “actively engaged in farming” requirement by providing only minimal personal management and zero personal labor.  In some cases, participating in just two conference calls a year has been enough to pass the actively engaged in farming test.  This management loophole must be closed or mega-farms will continue to collect huge multimillion dollar annual payments, funneling payments through passive investors, non-farm businesses, and sham “paper” farms.  Those ill-gotten excess subsidies are used to outbid smaller farmers and beginning farmers for land, leading to land concentration and the slow demise of family farming.  This loophole is strangling the economic future of rural communities and choking off economic opportunity and farm entry for the next generation of farmers. 
  • When a person tries to qualify for farm payments by providing only active personal management and no personal labor, the rules should require the person to provide at least half of the total management required to run the farm or at least half of the total management that would be necessary to conduct a farming operation commensurate in size with his/her requisite share of the operation.  This is the key point that must be addressed in developing the new rule.
  • The “actively engaged in farming” rules do not apply to landlords, so tightening it will not interfere with crop share leases.  Widows and heirs who rent their land through crop share leases will not be affected by tightening the rules.  But tightening the rules will prevent mega farms from collecting unlimited farm payments.
  • Closing the “actively engaged in farming” management loophole will strengthen family farms and rural communities, save federal resources, and help restore integrity to a program which is sadly still rife with abuse. 
  • Both Republican and Democratic Administrations have for decades either added regulatory loopholes or at best looked the other way and allowed the abuse to continue.  This Administration, which campaigned on commodity program payment reform, needs to end business as usual, clean up the system, and restore good government.  Enacting a quantifiable test for farm management is the place to start because it is the granddaddy of all loopholes.

Background:  In the 2008 Farm Bill, Congress directed USDA to rewrite the regulations used to determine whether a person is “actively engaged” in farming and thus eligible for payments.  The Bush Administration issued an interim rule right before leaving office that takes a few small steps forward, but leaves the big loophole wide open, thus ensuring the continuation of unlimited payments to mega-farms. 

Rather than continuing to nibble around the edges of the problem, the Obama Administration needs to go right to the heart of the matter, close the loophole, and stop wasting taxpayer’s money in an annual bailout scheme that puts the mid-sized family farm at an unfair competitive disadvantage with mega farms.

Under current rules, to be eligible for payments under the labor test one must provide 1,000 hours of labor a year or half of one’s requisite share of the total labor to operate the farm, but to be eligible for payments under the alternative management test, anything goes -- there is no quantifiable standard.  Congress’ own Government Accountability Office found that mega farms have been funneling payments through people who are not farmers, who do not live anywhere near the farm, and who participate in a couple conference calls a year, calling these people “farm managers” each of whom then becomes eligible for a full payment. 

Those “two conference call a year” people are among the simpler schemes used to evade the law.  There are more complex ones as well.  For example, the Government Accountability Office provides this illustrative example:

A general partnership that farms more than 50,000 acres was divided into more than 30 non-farming entity corporations which together collected over $5 million in annual farm payments in 2001  However, the partnership reported a net loss in 2001 due to its transactions with those non-farming entities, including a land leasing company, equipment and petroleum dealerships and crop processing companies.  These non-farming entities charged above-market prices for goods and services, including excessive charges for storage and processing, and paid below-market prices for the harvest.  All the non-farm entities had ownership linked to one individual.   This served to take payments from many different "farms" and concentrate them into profits for a single person. 

These schemes to rip off the taxpayer and put family farmers out of business are an outrage, and it is time to put a stop to it!  Please write to USDA today and say enough is enough!  Tell them to fix the rule now by adding a real, quantifiable management test and then actively enforce the law against those who try to continue to bilk the program.

Thanks for your action to support family farms!

National Sustainable Agriculture Coalition
110 Maryland Avenue NE Washington, D.C. 20002
Phone: (202) 547-5754 Fax: (202) 547-1837

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