Agricultural
Market Transition Act, Public Law 104- 127, as amended; Agriculture,
Rural Development, Food and Drug Administration, and Related Agencies
Appropriations Act of 2000, Public Law 106-78; Emergency Farm Financial
Relief Act, Public Law 105-228; Food Security Act of 1985, as amended,
Public Law 99-198; Agricultural Act of 1949, as amended, Public
Law 81-439; Commodity Credit Corporation Charter Act, as amended,
Public Law 80-806; Agricultural Adjustment Act of 1938, as amended,
Public Law 75-430.
To
support farming certainty and flexibility while ensuring continued
compliance with farm conservation and wetland protection requirements.
TYPES
OF ASSISTANCE:
Direct Payments with Unrestricted Use. Place Cursor Here for Definition
USES
AND USE RESTRICTIONS:
Producers
enrolled in the 7-year Production Flexibility Contracts during the
one-time sign-up held in 1996 are eligible to receive contract payments.
All contracts, except those executed after the expiration of Conservation
Reserve Program contracts (with an associated crop acreage base
reduction), began with the 1996 crop and extend through the 2002
crop. A farm was eligible for enrollment if it had a wheat, corn,
grain sorghum, barley, oats, upland cotton, or rice crop acreage
base established for 1996. Once the farm is enrolled, the crop acreage
base becomes contract acreage. Commodity- specific contract payment
rates are determined annually based on the statutory spending levels
and the amount of enrolled contract acreage. Farm level commodity
payments are equal to the contract payment rate multiplied by 85
percent of the contract acreage multiplied by the farm program payment
yield. To be eligible for contract payments producers are required
to: (a) comply with the conservation and wetland protection requirements
on all of the producer's farms; (b) comply with planting flexibility
requirements; (c) use the contract acreage for an agricultural or
related activity; and (d) obtain at least the catastrophic level
of crop insurance for each crop of economic significance or provide
a written statement that waives any eligibility for emergency crop
loss assistance; and (e) file annual acreage reports on any fruit
or vegetable plantings on contract acreage. Annual payments are
made no later than September 30 of each of fiscal years 1996-2002.
For fiscal year 1996-1998, producers could elect to receive 50 percent
advance payments on December 15 or January 15 of the respective
fiscal year. For fiscal years 1999-2002 payments, producers may
choose to receive fiscal year 1999-2002 production flexibility contract
payments as two 50 percent payments or one 100 percent payment at
any time during the respective fiscal year. Final payments will
be paid by September 30 of the respective fiscal year.
ELIGIBILITY
REQUIREMENTS:
Applicant
Eligibility: Owner, landlord, tenant, or sharecropper
on a farm with enrolled contract acreage that meets program requirements
as announced by the Secretary.
Beneficiary
Eligibility: Owner, landlord, tenant, or share
cropper on a farm with contract acreage that meets program requirements
as announced by the Secretary.
Credentials/Documentation:
Record of farming operation must be on file in the FSA county
office. This program is excluded from coverage under OMB Circular
No. A-87.
Pre-application
Coordination: None. This program is excluded
from coverage under OMB Circular No. A-102 and E.O. 12372.
Application
Procedure: The farm operator visits the FSA
office to sign Form-478, a Production Flexibility Contract and
to report fruit and vegetable acreage planted for harvest on contract
acreage on Form-578. This program is excluded from coverage under
OMB Circular Nos. A-102 and A-110.
Award
Procedure: Not applicable.
Deadlines:
The sign-up period, except for farms with land under a Conservation
Reserve Program (CRP) contract that has an associated crop acreage
base reduction, ended in 1996. The land under an expiring CRP
contract can be added to an existing Production Flexibility Contract
or enrolled as a new contract from October 1 through November
30 in the year following the fiscal year in which the CRP contract
expires. Once enrolled, farm operators report acreage of fruits
and vegetables grown on contract acreage specified dates which
vary by State and within States. Contact State or county FSA offices
for applicable deadlines.
Range
of Approval/Disapproval Time: Approval of
payments depends on farmer compliance with conservation and wetland
protection requirements on all of the producers' farms, planting
flexibility requirements and other eligibility, and is fairly
routine and prompt.
Appeals:
If producer questions yields or other determinations, he may appeal
to the FSA county office within 15 days after being notified.
Renewals:
Not applicable.
ASSISTANCE
CONSIDERATIONS:
Formula
and Matching Requirements: Not applicable.
Length
and Time Phasing of Assistance: Payment by
check is made no later than September 30 of each of fiscal years
1996-2002. For fiscal year 1996-1998 payments, producers could
elect to receive 50 percent advance payments on December 15 or
January 15 of the respective fiscal year. For fiscal year 1999-2002
payments, producers may choose to receive production flexibility
contract payments as two 50 percent payments or one 100 percent
payment at any time during the respective fiscal year. Final payments
will be paid by September 30 of the respective fiscal year.
POST
ASSISTANCE REQUIREMENTS:
Reports:
Applicant reports any disaster (when applicable) which would affect
crop yield.
Audits:
Recipients are subject to audit by Office of Inspector General,
USDA.
Records:
Not applicable.
FINANCIAL
INFORMATION:
Account
Identification: 12-4336-0-3-351.
Obligations:
(Production Flexibility Contract Payments) FY 01 $5,056,953,514;
FY 02 est $4,071,721,000; and FY 03 est $3,951,656,000. Obligations
include the amounts formerly in 10.052, 10.055, 10.058, and 10.065.
Range
and Average of Financial Assistance:
The production flexibility contract payments for the 2000 crops
as of December 31, 2001 consisted of: $2,719,900,000 for feed
grains; $1,336,361,000 for wheat; $574,433,000 for upland cotton;
and $432,865,000 for rice. The estimated production flexibility
contract payments for the 2002 crops as of December 31, 2001 are:
$713,770,000 for feed grains; $373,723,000 for wheat; $108,675,000
for upland cotton; and $45,287,000 for rice. Cotton, feed grain,
wheat and rice production flexibility contract payments, in total,
may not exceed $40,000 to any one person during any fiscal year.
The contract enrollment report for the 2001 crop production flexibility
contracts consisted of: 1,607,321 contract enrolled farms for feed
grains; 1,016,618 contract enrolled farms for wheat; 176,650 contract
enrolled farms for upland cotton; and 24,608 contract enrolled farms
for rice.
REGULATIONS,
GUIDELINES, AND LITERATURE:
Program regulations are published in the Federal Register. Announcements
issued to news media and letters to producers. Background Information--"Services
for Farmers", July 1999, no cost; Fact Sheet--"Production Flexibility
Contracts and Marketing Assistance Loans", February 1999, no cost;
Final Cost/Benefit Analysis, no cost; Farm Service Agency, U.S.
Department of Agriculture, STOP 0508, 1400 Independence Avenue SW.,
Washington, DC 20250-0532.
INFORMATION
CONTACTS:
Regional
or Local Office: Consult the local telephone
directory for location of the FSA county office. If no listing,
get in touch with appropriate FSA State office listed in the Farm
Service Agency Section of Appendix IV of the Catalog.
Headquarters
Office: Department of Agriculture, Farm Service
Agency, Economic and Policy Analysis Staff, STOP 0508, 1400 Independence
Avenue SW., Washington, DC 20250-0508. Telephone: (202) 720-2711.
Contact Person: Philip Sronce.
