November, 2021 Farm Service Agency Newletter

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[December 15, 2021]     Message from the Acting SED - We hope this message finds the 2021 harvest safely wrapping up for most Illinois producers.

With grain in the bin and improvement in the markets, there is much tax planning and financial projections being considered. These plans may include FSA marketing assistance loans, farm storage facility loans, or FSA direct or guaranteed loan financing.

Please contact your local County Office early in the process if you are contemplating any of these options. Although we still have restrictions in place, we strive to provide the best service possible to Illinois farm families.

All of us at the Illinois Farm Service Agency wish you a happy and safe Thanksgiving holiday and time enjoyed with your families.

John Gehrke
Acting State Executive Director


FSA Encourages Farmers and Ranchers to Vote in County Committee Elections

The 2021 Farm Service Agency County Committee Elections will begin on November 1, 2021, when ballots are mailed to eligible voters. The deadline to return ballots to local FSA offices, or to be postmarked, is December 6, 2021.
 


County committee members are an important component of the operations of FSA and provide a link between the agricultural community and USDA. Farmers and ranchers elected to county committees help deliver FSA programs at the local level, applying their knowledge and judgment to make decisions on commodity price support programs; conservation programs; incentive indemnity and disaster programs for some commodities; emergency programs and eligibility. FSA committees operate within official regulations designed to carry out federal laws.

To be an eligible voter, farmers and ranchers must participate or cooperate in an FSA program. A person who is not of legal voting age but supervises and conducts the farming operations of an entire farm, may also be eligible to vote. A cooperating producer is someone who has provided information about their farming or ranching operation(s) but may not have applied or received FSA program benefits.

Eligible voters in the local administrative area holding a 2021 election who do not receive a ballot can obtain one from their local USDA Service Center.

Newly elected committee members will take office January 1, 2022.

More information on county committees, such as the new 2021 fact sheet, can be found on the FSA website at fsa.usda.gov/elections or at a local USDA Service Center.


RMA Makes Improvements to Whole-Farm Revenue Protection (WFRP)

Organic and aquaculture producers can soon benefit from updates to the USDA Whole-Farm Revenue Protection (WFRP) plan. USDA’s Risk Management Agency (RMA) is revising the plan of insurance to make it more flexible and accessible to producers beginning in crop year 2022.

Changes to WFRP include:

Increasing expansion limits for organic producers to the higher of $500,000 or 35 percent. Previously, small and medium size organic operations were held to the same 35 percent limit to expansion as conventional practice producers.
 


Increasing the limit of insurance for aquaculture producers to $8.5 million. Previously aquaculture producers were held to a $2 million cap on expected revenue, this change allows more aquaculture producers to participate in the program.

Allowing a producer to report acreage as certified organic, or as acreage in transition to organic, when the producer has requested an organic certification by the acreage reporting date. This allows organic producers more flexibility when reporting certified acreage.

Providing flexibility to report a partial yield history for producers lacking records by inserting zero yields for missing years. Previously, missing a year of records would cause the commodity’s expected value to be zero, meaning past revenue from the commodity would contribute nothing to the insurance guarantee.

WFRP provides a risk management safety net for all commodities on the farm under one insurance policy and is available in all counties nationwide. This insurance plan is tailored for any farm with up to $8.5 million in insured revenue, including farms with specialty or organic commodities (both crops and livestock), or those marketing to local, regional, farm-identity preserved, specialty, or direct markets.

Crop insurance is sold and delivered solely through private crop insurance agents. A list of crop insurance agents is available at all USDA Service Centers and online at the RMA Agent Locator. Learn more about crop insurance and the modern farm safety net at rma.usda.gov.


Making Farm Reconstitutions

When changes in farm ownership or operation take place, a farm reconstitution is necessary. The reconstitution — or recon — is the process of combining or dividing farms or tracts of land based on the farming operation.

To be effective for the current Fiscal Year (FY), farm combinations and farm divisions must be requested by August 1 of the FY for farms subject to the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) program. A reconstitution is considered to be requested when all of the required signatures are on FSA-155 and all other applicable documentation, such as proof of ownership, is submitted.
 


Total Conservation Reserve Program (CRP) and non-ARC/PLC farms may be reconstituted at any time.

The following are the different methods used when doing a farm recon:

Estate Method — the division of bases, allotments and quotas for a parent farm among heirs in settling an estate

Designation of Landowner Method — may be used when (1) part of a farm is sold or ownership is transferred; (2) an entire farm is sold to two or more persons; (3) farm ownership is transferred to two or more persons; (4) part of a tract is sold or ownership is transferred; (5) a tract is sold to two or more persons; or (6) tract ownership is transferred to two or more persons. In order to use this method, the land sold must have been owned for at least three years, or a waiver granted, and the buyer and seller must sign a Memorandum of Understanding

DCP Cropland Method — the division of bases in the same proportion that the DCP cropland for each resulting tract relates to the DCP cropland on the parent tract

Default Method — the division of bases for a parent farm with each tract maintaining the bases attributed to the tract level when the reconstitution is initiated in the system.

For questions on your farm reconstitution, contact your local USDA Service Center. To find a local service, click this link.


Sign up for Wetland Reserve Easements for 2022

USDA's Natural Resources Conservation Service (NRCS) announced the application period for the Fiscal Year (FY) 2022 Agricultural Conservation Easement Program - Wetland Reserve Easements. (ACEP-WRE). The purpose of the Wetland Reserve Easements (WRE) program is to help landowners enhance and protect habitat for wetland wildlife on their lands, reduce impacts from flooding, recharge groundwater, provide outdoor recreation, and increase habitat for migratory waterfowl.

NRCS wants landowners and farmers to know that the first application cut-off date for fiscal year 2022 has been established. NRCS accepts applications for Wetland Reserve Easements (WRE) year round. Applications NRCS receives that meet program eligibility by December 10, 2021 will be considered for funding in our 2022 program.
 


Land eligible for WRE includes farmed or converted wetlands that have been previously altered for agricultural production that can be successfully and cost-effectively restored. NRCS prioritizes applications based on the easement’s potential for improving water quality and protecting and enhancing habitat for migratory birds and other wildlife. To enroll land through this program, NRCS enters into purchase agreements with eligible private landowners and then they work together to develop and implement a wetland reserve plan to guide the restoration easement process. This plan restores, enhances, and protects the wetland’s functions and values.

Applications for ACEP-WRE are continuous and can be submitted at any time. For FY 2022, Illinois NRCS has received $3.8 million in funding and will make funding decisions for eligible applicant interested in ACEP-WRE.

NRCS provides technical and financial assistance directly to private landowners to restore, protect and enhance wetlands through the purchase of these easements, and eligible landowners can choose to enroll in either a permanent easement or a 30-year easement. To apply for a wetland easement through ACEP - WRE, visit NRCS at your local USDA Service Center. Due to COVID-19 restrictions, producers should call to set up appointments with their local NRCS office staff. Visit www.nrcs.usda.gov to learn more.

Find more information about ACEP and other NRCS conservation programs in Illinois online at https://www.nrcs.usda.
gov/wps/portal/nrcs/il/programs/.


Farm Storage Facility Loans

FSA’s Farm Storage Facility Loan (FSFL) program provides low-interest financing to producers to build or upgrade storage facilities and to purchase portable (new or used) structures, equipment and storage and handling trucks.

The low-interest funds can be used to build or upgrade permanent facilities to store commodities. Eligible commodities include corn, grain sorghum, rice, soybeans, oats, peanuts, wheat, barley, minor oilseeds harvested as whole grain, pulse crops (lentils, chickpeas and dry peas), hay, honey, renewable biomass, fruits, nuts and vegetables for cold storage facilities, floriculture, hops, maple sap, rye, milk, cheese, butter, yogurt, meat and poultry (unprocessed), eggs, and aquaculture (excluding systems that maintain live animals through uptake and discharge of water). Qualified facilities include grain bins, hay barns and cold storage facilities for eligible commodities.

Loans up to $50,000 can be secured by a promissory note/security agreement and loans between $50,000 and $100,000 may require additional security. Loans exceeding $100,000 require additional security.
 


Producers do not need to demonstrate the lack of commercial credit availability to apply. The loans are designed to assist a diverse range of farming operations, including small and mid-sized businesses, new farmers, operations supplying local food and farmers markets, non-traditional farm products, and underserved producers.

To learn more about the FSA Farm Storage Facility Loan, visit www.fsa.usda.gov/pricesupport or contact your local FSA county office. To find your local FSA county office, visit http://offices.usda.gov.


Preauthorized Debit Available for Farm Loan Borrowers

USDA’s Farm Service Agency (FSA) has implemented pre-authorized debit (PAD) for Farm Loan Program (FLP) borrowers. PAD is a voluntary and alternative method for making weekly, bi-weekly, monthly, quarterly, semi-annual or annual payments on loans.

PAD payments are pre-authorized transactions that allow the National Financial and Accounting Operations Center (NFAOC) to electronically collect loan payments from a customer’s account at a financial institution.

PAD may be useful if you use nonfarm income from regular wages or salary to make payments on loans or adjustment offers or for payments from seasonal produce stands. PAD can only be established for future payments.

To request PAD, customers, along with their financial institution, must fill out form RD 3550-28. This form has no expiration date, but a separate form RD 3550-28 must be completed for each loan to which payments are to be applied. A fillable form can be accessed on the USDA Rural Development (RD) website at rd.usda.gov/publications/regulations-guidelines. Click forms and search for “Form 3550-28.”

If you have a “filter” on the account at your financial institution, you will need to provide the financial institution with the following information: Origination ID: 1220040804, Agency Name: USDA RD DCFO.

PAD is offered by FSA at no cost. Check with your financial institution to discuss any potential cost. Preauthorized debit has no expiration date, but you can cancel at any time by submitting a written request to your local FSA office. If a preauthorized debit agreement receives three payment rejections within a three-month period, the preauthorized debit agreement will be cancelled by FSA. The payment amount and due date of your loan is not affected by a cancellation of preauthorized debit. You are responsible to ensure your full payment is made by the due date.
 


For more information about PAD, contact your local County USDA Service Center or visit fsa.usda.gov.


USDA Launches First Phase of Soil Carbon Monitoring Efforts through CRP

The U.S. Department of Agriculture (USDA) is investing $10 million in a new initiative to sample, measure, and monitor soil carbon on Conservation Reserve Program (CRP) acres to better quantify the climate outcomes of the program. CRP is an important tool in the Nation’s fight to reduce the worst impacts of climate change facing our farmers, ranchers, and foresters. This initiative will begin implementation in fall 2021 with three partners. Today’s announcement is part of a broader, long-term soil carbon monitoring effort across agricultural lands that supports USDA’s commitment to deliver climate solutions to agricultural producers and rural America through voluntary, incentive-based solutions.

These models include the Daily Century Model, or DayCent, which simulates the movement of carbon and nitrogen through agricultural systems and informs the National Greenhouse Gas Inventory. Data will also be used to strengthen the COMET-Farm and COMET-Planner tools, which enable producers to evaluate potential carbon sequestration and greenhouse gas emission reductions based on specific management scenarios.   

USDA partners will conduct soil carbon sampling on three categories of CRP practice types: perennial grass, trees, and wetlands.

Perennial grasses: In consultation with USDA, Michigan State University will sample and measure soil carbon and bulk density of CRP grasslands (including native grass plantings, rangelands, and pollinator habitat plantings) at an estimated 600 sites across the U.S. with a focus in the central states during this five-year project. This information will be used to model and compare the climate benefits of CRP. Partners include the University of Wisconsin-Madison, the University of Arkansas at Pine Bluff, Deveron, an agriculture technology company, and Woods End Laboratories.

Trees: Mississippi State University will partner with Alabama A&M University to collect above and below ground data at 162 sites across seven states documenting CRP-related benefits to soil and atmospheric carbon levels. Information will help further calibrate the DayCent model. This five-year project will focus within the Mississippi Delta and Southeast states.

Wetlands: Ducks Unlimited and its partners will collect data on carbon stocks in wetland soils as well as vegetation carbon levels at 250 wetland sites across a 15-state area in the central U.S. Data will support the DayCent and additional modeling. Partners for this five-year project include: Migratory Bird Joint Venture, Intertribal Research and Resource Center at United Tribes Technical College, Clemson University, Kenyon College, Lincoln University, Pennsylvania State University, the University of Missouri, and the University of Texas at Austin.

CRP Monitoring, Assessment, and Evaluation Projects    

These three Climate Change Mitigation Assessment Initiative projects are funded through FSA’s program to work with partners to identify Monitoring, Assessment and Evaluation (MAE) projects to quantify CRP environmental benefits to water quality and quantity, wildlife, and rural economies.

Applications for projects were welcome from all organizations, including public, private, nonprofit institutions, and educational institutions including  historically Black colleges and universities, Tribal colleges and universities and Hispanic-serving institutions or organizations.   

For more details on the all the awarded MAE projects, visit the FSA Monitoring Assessment & Evaluation webpage.   

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About the Conservation Reserve Program   

CRP is one of the world’s largest voluntary conservation programs, with an established track record of preserving topsoil, sequestering carbon, reducing nitrogen runoff and providing healthy habitat for wildlife. 

In exchange for a yearly rental payment, agricultural producers enrolled in the program agree to remove environmentally sensitive land from production and plant species that will improve environmental health and quality. In general, land is enrolled in CRP for 10 to 15 years, with the option of re-enrollment. FSA offers multiple CRP signups, including the general signup and continuous signup, as well as Grassland CRP and pilot programs focused on soil health and clean water. In 2021, producers and landowners enrolled more than 5.3 million acres in CRP signups, surpassing USDA’s 4-million-acre goal.  

Earlier this year, USDA announced updates to CRP including higher payment rates, new incentives for environmental practices, and a more targeted focus on the program’s role in climate change mitigation. This included a new Climate-Smart Practice Incentive for CRP general and continuous signups that aims to increase carbon sequestration and reduce greenhouse gas emissions. Climate-Smart CRP practices include establishment of trees and permanent grasses, development of wildlife habitat, and wetland restoration. Download the “What’s New” fact sheet to learn more about CRP updates. 


 

FSA is Accepting CRP Continuous Enrollment Offers

The Farm Service Agency (FSA) is accepting offers for specific conservation practices under the Conservation Reserve Program (CRP) Continuous Signup.

In exchange for a yearly rental payment, farmers enrolled in the program agree to remove environmentally sensitive land from agricultural production and to plant species that will improve environmental health and quality. The program’s long-term goal is to re-establish valuable land cover to improve water quality, prevent soil erosion, and reduce loss of wildlife habitat. Contracts for land enrolled in CRP are 10-15 years in length.
 


Under continuous CRP signup, environmentally sensitive land devoted to certain conservation practices can be enrolled in CRP at any time. Offers for continuous enrollment are not subject to competitive bidding during specific periods. Instead, they are automatically accepted provided the land and producer meet certain eligibility requirements and the enrollment levels do not exceed the statutory cap.

For more information, including a list of acceptable practices, contact your local County USDA Service Center or visit fsa.usda.gov/crp.


USDA Microloans Help Farmers Purchase Farmland and Improve Property

Farmers can use USDA farm ownership microloans to buy and improve property. These microloans are especially helpful to beginning or underserved farmers, U.S. veterans looking for a career in farming, and those who have small and mid-sized farming operations.

Microloans have helped farmers and ranchers with operating costs, such as feed, fertilizer, tools, fencing, equipment, and living expenses since 2013.

Microloans can also help with farmland and building purchases and soil and water conservation improvements. FSA designed the expanded program to simplify the application process, expand eligibility requirements and expedite smaller real estate loans to help farmers strengthen their operations. Microloans provide up to $50,000 to qualified producers and can be issued to the applicant directly from the USDA Farm Service Agency (FSA).

To learn more about the FSA microloan program, contact your local County USDA Service Center or visit fsa.usda.gov/microloans.


Linkage Requirements for Payments Received Under WHIP+ and/or QLA

If you received a payment under the Wildfires and Hurricanes Indemnity Program+ (WHIP+) or the Quality Loss Adjustment Program (QLA) for crop production and/or quality losses occurring in 2018, 2019, or 2020 crop years, you are required to meet linkage requirements by obtaining federal crop insurance or Non-Insured Crop Disaster Assistance Program (NAP) coverage at the 60/100 level, or higher, for both the 2022 and 2023 crop years.
 


When applying for WHIP+ or QLA, form FSA-895 (Crop Insurance and/or NAP Coverage Agreement) was submitted acknowledging the requirement to obtain federal crop insurance, if available, or NAP coverage if federal crop insurance is not available. The coverage requirement is applicable to the physical location county of the crop that received WHIP+ and/or QLA benefits.

Producers should not delay contacting their federal crop insurance agent or local county FSA Office to inquire about coverage options, as failure to obtain the applicable coverage by the sales/application closing date will result in the required refund of WHIP+ benefits received on the applicable crop, plus interest. You can determine if crops are eligible for federal crop insurance or NAP by visiting the RMA website.

For more information, contact your local County USDA Service Center or visit fsa.usda.gov.


FSA Outlines MAL and LDP Policy

The 2018 Farm Bill extends loan authority through 2023 for Marketing Assistance Loans (MALs) and Loan Deficiency Payments (LDPs).

MALs and LDPs provide financing and marketing assistance for wheat, feed grains, soybeans, and other oilseeds, pulse crops, rice, peanuts, cotton, wool and honey. MALs provide you with interim financing after harvest to help you meet cash flow needs without having to sell your commodities when market prices are typically at harvest-time lows. A producer who is eligible to obtain a loan, but agrees to forgo the loan, may obtain an LDP if such a payment is available. Marketing loan provisions and LDPs are not available for sugar and extra-long staple cotton.

FSA is now accepting requests for 2021 MALs and LDPs for all eligible commodities after harvest. Requests for loans and LDPs shall be made on or before the final availability date for the respective commodities.

Commodity certificates are available to loan holders who have outstanding nonrecourse loans for wheat, upland cotton, rice, feed grains, pulse crops (dry peas, lentils, large and small chickpeas), peanuts, wool, soybeans and designated minor oilseeds. These certificates can be purchased at the posted county price (or adjusted world price or national posted price) for the quantity of commodity under loan, and must be immediately exchanged for the collateral, satisfying the loan. MALs redeemed with commodity certificates are not subject to Adjusted Gross Income provisions.
 


To be considered eligible for an LDP, you must have form CCC-633EZ, Page 1 on file at your local FSA Office before losing beneficial interest in the crop. Pages 2, 3 or 4 of the form must be submitted when payment is requested.

Marketing loan gains (MLGs) and loan deficiency payments (LDPs) are no longer subject to payment limitations, actively engaged in farming and cash-rent tenant rules.

Adjusted Gross Income (AGI) provisions state that if your total applicable three-year average AGI exceeds $900,000, then you’re not eligible to receive an MLG or LDP. You must have a valid CCC-941 on file to earn a market gain of LDP. The AGI does not apply to MALs redeemed with commodity certificate exchange.

For more information and additional eligibility requirements, contact your local County USDA Service Center or visit fsa.usda.gov.


Illinois Farmers:  Consider Conservation Easements

NRCS announced funding is now available for the Agricultural Conservation Easement Program - Agricultural Land Easements (ACEP-ALE). The ALE program can help address development and population pressures that pose a threat to Illinois farmland acres currently used for agricultural production. Through conservation easements, NRCS provides financial assistance to eligible partners or entities to assist landowners with the purchase of Agricultural Land Easements (ALE). These easements help farmers/landowners keep working croplands and grasslands in active, profitable agriculture production. The ALE sign-up is continuous. However, a funding cut-off date is established to allow eligible applications to compete for funding. The first funding cutoff for fiscal year (FY) 2022 is December 10, 2021. All eligible applications on file with NRCS on December 10th will be considered for funding.

Eligible entities include state and local governments and non-governmental organizations that have farmland or grassland protection programs. Dozier explains, “What is special about agricultural easements is that they can protect the long-term viability of our nation’s food supply, something that is more important than ever before. Easements are a powerful way to actually prevent conversion of productive working lands across Illinois to non-agricultural uses and conserve vital grazing land and pastures,” Dozier added. For FY 2022, NRCS has $423,000 available for funding.
 


Agricultural Land Easements can also help keep agriculture lands in the hands of family members, while providing an enhanced opportunity to keep productive land available for secure crop production. Easements can also offer farming opportunities for new farmers to agriculture. To date, producers and partners nationwide have successfully protected more than 1.8 million acres of farmland and grassland through ACEP’s predecessor programs – the Farm and Ranch Lands Protection Program and the Grassland Reserve Program.

Interested entities can sign up for ALE at their local NRCS office before the first funding cutoff of December 10, 2021. Interested landowners need to find an entity who is willing to assist in the purchase of the easement. If you do not know of an entity that would work, contact your local NRCS office to get more information about the type of entity that would hold an Agriculture Land Easement. Applications received by December 10, 2021 will be ranked in January and funding decisions will be made by NRCS after January 28, 2022.

Due to COVID-19 restrictions, producers should call to set up appointments with local NRCS office staff. Visit www.nrcs.usda.gov to learn more.


Unauthorized Disposition of Grain

If loan grain has been disposed of through feeding, selling or any other form of disposal without prior written authorization from the county office staff, it is considered unauthorized disposition. The financial penalties for unauthorized dispositions are severe and a producer’s name will be placed on a loan violation list for a two-year period. Always call before you haul any grain under loan.


Environmental Review Required Before Project Implementation

The National Environmental Policy Act (NEPA) requires Federal agencies to consider all potential environmental impacts for federally-funded projects before the project is approved.

For all Farm Service Agency (FSA) programs, an environmental review must be completed before actions are approved, such as site preparation or ground disturbance. These programs include, but are not limited to, the Emergency Conservation Program (ECP), Farm Storage Facility Loan (FSFL) program and farm loans. If project implementation begins before FSA has completed an environmental review, the request will be denied. Although there are exceptions regarding the Stafford Act and emergencies, it’s important to wait until you receive written approval of your project proposal before starting any actions.
 


Applications cannot be approved until FSA has copies of all permits and plans. Contact your local FSA office early in your planning process to determine what level of environmental review is required for your program application so that it can be completed timely.


Maintaining the Quality of Farm-Stored Loan Grain

Bins are ideally designed to hold a level volume of grain. When bins are overfilled and grain is heaped up, airflow is hindered and the chance of spoilage increases.

Producers who take out marketing assistance loans and use the farm-stored grain as collateral should remember that they are responsible for maintaining the quality of the grain through the term of the loan.


Transitioning Expiring CRP Land to Beginning, Veteran or Underserved Farmers and Ranchers

CRP contract holders are encouraged to transition their Conservation Reserve Program (CRP) acres to beginning, veteran or socially disadvantaged farmers or ranchers through the Transition Incentives Program (TIP). TIP provides annual rental payments to the landowner or operator for up to two additional years after the CRP contract expires.

CRP contract holders no longer need to be a retired or retiring owner or operator to transition their land. TIP participants must agree to sell, have a contract to sell, or agree to lease long term (at least five years) land enrolled in an expiring CRP contract to a beginning, veteran, or socially disadvantaged farmer or rancher who is not a family member.

Beginning, veteran or social disadvantaged farmers and ranchers and CRP participants may enroll in TIP beginning two years before the expiration date of the CRP contract. The TIP application must be submitted prior to completing the lease or sale of the affected lands. New landowners or renters that return the land to production must use sustainable grazing or farming methods.

For more information, contact your local County USDA Service Center or visit fsa.usda.gov.


 

 

The Importance of Responding to NASS Surveys

USDA’s National Agricultural Statistics Service (NASS) conducts hundreds of surveys every year and prepares reports covering virtually every aspect of U.S. agriculture.

If you receive a survey questionnaire, please respond quickly and online if possible.

The results of the surveys help determine the structure of USDA farm programs, such as soil rental rates for the Conservation Reserve Program and prices and yields used for the Agriculture Risk Coverage and Price Loss Coverage programs. This county-level data is critical for USDA farm payment determinations. Survey responses also help associations, businesses and policymakers advocate for their industry and help educate others on the importance of agriculture.

NASS safeguards the privacy of all respondents and publishes only aggregate data, ensuring that no individual operation or producer can be identified.

NASS data is available online at nass.usda.gov/Publications and through the searchable Quick Stats database. Watch a video on how NASS data is used at youtube.com/watch?v=m-4zjnh26io&feature=youtu.be.

[Farmers.Gov]

 

 

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