November 2017 Illinois FSA Newsletter

[December 13, 2017]    Welcome Back William J. Graff as State Executive Director - The Trump Administration recently appointed William J. Graff as the new State Executive Director (SED) for the USDA Illinois Farm Service Agency (FSA). Graff joined the Illinois FSA team on Monday, November 13, 2017.

Graff is a long time grain and livestock producer from central Illinois. He is familiar with the agriculture industry and USDA programs. He previously served as SED of the Illinois FSA under a previous administration. Graff is a graduate of Illinois State University.

Under the direction of Secretary Sonny Perdue, the USDA will always be facts-based and driven with a decision-making mindset that is customer-focused. Secretary Perdue leads the USDA with four guiding principles; to maximize the ability of American agriculture to create jobs, sell foods and fiber, and feed and clothe the world; to prioritize customer service for the taxpayers; to ensure that our food supply is safe and secure; and to maintain good stewardship of the natural resources that provide us with our miraculous bounty. And understanding that we live in a global economy where trade is of top importance, Secretary Perdue has pledged to be an unapologetic advocate for American agriculture.

As SED, Graff will use his leadership experience to oversee FSA programs in a customer-focused manner to ensure a safe, abundant and nutritious food supply for customers.

SED Graff is looking forward to serving the Illinois producers once again.

USDA Announces Enrollment Period for Safety Net Coverage in 2018

Beginning November 1, 2017, farmers and ranchers with base acres in the Agriculture Risk Coverage (ARC) or Price Loss Coverage (PLC) safety net program may enroll for the 2018 crop year.  The enrollment period will end on August 1, 2018.  

Since shares and ownership of a farm can change year-to-year, producers must enroll by signing a contract each program year.  

The producers on a farm that are not enrolled for the 2018 enrollment period will not be eligible for financial assistance from the ARC or PLC programs for the 2018 crop should crop prices or farm revenues fall below the historical price or revenue benchmarks established by the program.  Producers who made their elections in previous years must still enroll during the 2018 enrollment period. 

The ARC and PLC programs were authorized by the 2014 Farm Bill and offer a safety net to agricultural producers when there is a substantial drop in prices or revenues for covered commodities. Covered commodities include barley, canola, large and small chickpeas, corn, crambe, flaxseed, grain sorghum, lentils, mustard seed, oats, peanuts, dry peas, rapeseed, long grain rice, medium grain rice (which includes short grain and sweet rice), safflower seed, sesame, soybeans, sunflower seed and wheat. Upland cotton is no longer a covered commodity.  For more details regarding these programs, go to www.fsa.usda.gov/arc-plc. 

For more information, producers are encouraged to visit their local FSA office.  To find a local FSA office, visit http://offices.usda.gov. 

CRP Participants Must Maintain Approved Cover on Acreages Enrolled in CRP and Farm Programs

Conservation Reserve Program (CRP) participants are responsible for ensuring adequate, approved vegetative and practice cover is maintained to control erosion throughout the life of the contract after the practice has been established.  Participants must also control undesirable vegetation, weeds (including noxious weeds), insects and rodents that may pose a threat to existing cover or adversely impact other landowners in the area. 

All CRP maintenance activities, such as mowing, burning, disking and spraying, must be conducted outside the primary nesting or brood rearing season for wildlife, which for Illinois is April 1 through August 1.  However, spot treatment of the acreage may be allowed during the primary nesting or brood rearing season if, left untreated, the weeds, insects or undesirable species would adversely impact the approved cover.  In this instance, spot treatment is limited to the affected areas in the field and requires County Committee approval prior to beginning the spot treatment.  The County Committee will consult with NRCS to determine if such activities are needed to maintain the approved cover. 

Annual mowing of CRP for generic weed control, or for cosmetic purposes, is prohibited at all times.

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.   

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 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 for borrowers who 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 http://www.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 FSA office.  To find a local FSA office, visit http://offices. usda.gov

Marketing Assistance Available for 2017 Crops

The 2014 Farm Bill authorized 2014-2018 crop year Marketing Assistance Loans (MALs) and Loan Deficiency Payments (LDPs).

MALs provide financing and marketing assistance for 2017 feed grains, soybeans and other oilseeds, pulse crops, rice, peanuts, cotton, wool and honey.  MALs provide producers interim financing after harvest to help them meet cash flow needs without having to sell their commodities when market prices are typically at harvest-time lows.

A producer who is eligible to obtain an MAL, but agrees to forgo the loan, may obtain an LDP if    
such a payment is available.

To be eligible for an MAL or an LDP, producers must have a beneficial interest in the commodity, in addition to other requirements.  A producer retains beneficial interest when control of and title to the commodity is maintained.  For an LDP, the producer must retain beneficial interest in the commodity from the time of planting through the date the producer filed Form CCC-633EZ (page 1) in the FSA County Office.  For more information, producers should contact their local FSA county office or view the LDP Fact Sheet.

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.

Permitted Revision of Intended use After Acreage Reporting Date

New operators or owners who pick up a farm after the acreage reporting deadline has passed and the crop has already been reported on the farm, have 30 days to change the intended use.  Producer share interest changes alone will not allow for revisions to intended use after the acreage reporting date.  The revision must be performed by either the acreage reporting date or within 30 calendar days from the date when the new operator or owner acquired the lease on land, control of the land or ownership and new producer crop share interest in the previously reported crop acreage.  Under this policy, appropriate documentation must be provided to the County Committee’s satisfaction to determine that a legitimate operator or ownership and producer crop share interest change occurred to permit the revision. 

Acreage Reports:

In order to maintain program eligibility and benefits, producers must timely file acreage reports.  Failure to file an acreage report by the crop acreage reporting deadline may result in ineligibility for future program benefits.  FSA will not accept acreage reports provided more than a year after the acreage reporting deadline. 

Definitions of Terms

FSA defines “idle” as cropland or a balance of cropland within a Common Land Unit (CLU) (field/subfield) which is not planted or considered not planted and does not meet the definition of fallow or skip row.  For example, the balance of a field that could not be planted due to moisture or a turn area that is not planted would be reported as idle.   

Fallow is considered unplanted cropland acres which are part of a crop/fallow rotation where cultivated land that is normally planted is purposely kept out of production during a regular growing season. Resting the ground in this manner allows it to recover its fertility and conserve moisture for crop production in the next growing season.

Unauthorized Disposition of Grain

If loan 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 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.  If you have any questions concerning the movement of grain under loan, please contact your local county FSA office.

Cover Crop Guidelines

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.  If you have any questions concerning the movement of grain under loan, please contact your local county FSA Office.

Recently the Farm Service Agency (FSA), Natural Resources Conservation Service (NRCS) and Risk Management Agency (RMA) worked together to develop consistent, simple and a flexible policy for cover crop practices.  

The termination and reporting guidelines were updated for cover crops.  

Termination:

The cover crop termination guidelines provide the timeline for terminating cover crops, are based on zones and apply to non-irrigated cropland.  To view the zones and additional guidelines visit https://www.nrcs. usda.gov/wps/ portal/nrcs/main/national/ landuse/ crops/ and click “Cover Crop Termination Guidelines.”

Reporting:

The intended use of cover only will be used to report cover crops.  This includes crops that were terminated by tillage and reported with an intended use code of green manure.  An FSA policy change will allow cover crops to be hayed and grazed.  Program eligibility for the cover crop that is being hayed or grazed will be determined by each specific program. 

If the crop reported as cover only is harvested for any use other than forage or grazing and is not terminated properly, then that crop will no longer be considered a cover crop.  

Crops reported with an intended use of cover only will not count toward the total cropland on the farm. In these situations a subsequent crop will be reported to account for all cropland on the farm. 

Cover crops include grasses, legumes, and forbs, for seasonal cover and other conservation purposes.  Cover crops are primarily used for erosion control, soil health Improvement, and water quality improvement.  The cover crop may be terminated by natural causes, such as frost, or intentionally terminated through chemical application, crimping, rolling, tillage or cutting.  A cover crop managed and terminated according to NRCS Cover Crop Termination Guidelines is not considered a crop for crop insurance purposes. 

Cover crops can be planted: with no subsequent crop planted, before a subsequent crop, after prevented planting acreage, after a planted crop, or into a standing crop.

Actively Engaged Provisions for Non-Family Joint Operations or Entities

Many Farm Service Agency programs require all program participants, either individuals or legal entities, to be “actively engaged in farming”.  This means participants provide a significant contribution to the farming operation, whether it is capital, land, equipment, active personal labor and/or management.  For entities, each partner, stockholder or member with an ownership interest, must contribute active personal labor and/or management to the operation on a regular basis. 

The 2014 Farm Bill established additional payment eligibility provisions relating to the farm management component of meeting “actively engaged in farming”.  These provisions apply to joint operations comprised of non-family members or partners, stockholders or persons with an ownership in the farming operation.  Effective for 2016 and subsequent crop years, non-family joint operations are afforded to one member that may use a significant contribution of active personal management exclusively to meet the requirements to be determined “actively engaged in farming”.  The person or member will be defined as the Farm Manager for the purposes of administering these new management provisions.   

In some instances, additional persons or members of a non-family member joint operation who meet the definition of Farm Manager may also be allowed to use such a contribution of active personal management to meet the eligibility requirements.  However, under no circumstances may the number of Farm Managers in a non-family joint operation exceed a total of three in any given crop and program year. 

Change in Farming Operation

If you have bought or sold land, or if you have picked up or dropped rented land from your operation, make sure you report the changes to the county office as soon as possible.  You need to provide a copy of your deed or recorded land contract for purchased property.   Failure to maintain accurate records with FSA on all land you have an interest in can lead to possible program ineligibility and penalties. Making the record changes now will save you time in the spring.  Update signature authorization when changes in the operation occur.  Producers are reminded to contact their county office if there is a change in operations on a farm so that records can be kept current and accurate.

Youth Loans

The Farm Service Agency makes loans to youth to establish and operate agricultural income-producing projects in connection with 4-H clubs, FFA and other agricultural groups.  Projects must be planned and operated with the help of the organization advisor, produce sufficient income to repay the loan and provide the youth with practical business and educational experience.  The maximum loan amount is $5000.

Youth Loan Eligibility Requirements:

·  Be a citizen of the United States (which includes Puerto Rico, the Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands) or a legal resident alien

·  Be 10 years to 20 years of age

·  Comply with FSA’s general eligibility requirements

·  Be unable to get a loan from other sources

·  Conduct a modest income-producing project in a supervised program of work as outlined above

·  Demonstrate capability of planning, managing and operating the project under guidance and assistance from a project advisor.  The project supervisor must recommend the youth loan applicant, along with providing adequate supervision.  

Stop by the county office for help preparing and processing the application forms.

Reporting Organic Crops

Producers who want to use the Noninsured Crop Disaster Assistance Program (NAP) organic price and selected the "organic" option on their NAP application must report their crops as organic.  

When certifying organic acres, the buffer zone acreage must be included in the organic acreage. 

Producers must also provide a current organic plan, organic certificate or documentation from a certifying agent indicating an organic plan is in effect.  Documentation must include: 

·  name of certified individuals

·  address

·  telephone number

·  effective date of certification

·  certificate number

·  list of commodities certified

·  name and address of certifying agent

·  a map showing the specific location of each field of certified organic, including the buffer zone acreage

Certification exemptions are available for producers whose annual gross agricultural income from organic sales totals $5,000 or less.  Although exempt growers are not required to provide a written certificate, they are still required to provide a map showing the specific location of each field of  certified organic, transitional and buffer zone acreage. 

For questions about reporting organic crops, contact your local FSA office.  To find your local office, visit http://offices.usda.gov.

Dairy Producers Can Enroll for 2018 Coverage

The U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) today announced that starting Sept. 1, 2017, dairy producers can enroll for 2018 coverage in the Margin Protection Program (MPP-Dairy).  Secretary Sonny Perdue has utilized additional flexibility this year by providing dairy producers the option of opting out of the program for 2018. 

To opt out, a producer should not sign up during the annual registration period. By opting out, a producer would not receive any MPP-Dairy benefits if payments are triggered for 2018.  Full details will be included in a subsequent Federal Register Notice.  The decision would be for 2018 only and is not retroactive.   

The voluntary program, established by the 2014 Farm Bill, provides financial assistance to participating dairy producers when the margin – the difference between the price of milk and feed costs – falls below the coverage level selected by the producer. 

MPP-Dairy gives participating dairy producers the flexibility to select coverage levels best suited for their operation. Enrollment ends on Dec. 15, 2017, for coverage in calendar year 2018.  Participating farmers will remain in the program through Dec. 31, 2018, and pay a minimum $100 administrative fee for 2018 coverage.  Producers have the option of selecting a different coverage level from the previous coverage year during open enrollment. 

Dairy operations enrolling in the program must meet conservation compliance provisions and cannot participate in the Livestock Gross Margin Dairy Insurance Program.  Producers can mail the appropriate form to the producer’s administrative county FSA office, along with applicable fees, without necessitating a trip to the local FSA office.  If electing higher coverage for 2018, dairy producers can either pay the premium in full at the time of enrollment or pay 100 percent of the premium by Sept. 1, 2018. Premium fees may be paid directly to FSA or producers can work with their milk handlers to remit premiums on their behalf. 

USDA has a web tool to help producers determine the level of coverage under the MPP-Dairy that will provide them with the strongest safety net under a variety of conditions.  The online resource, available at www.fsa.usda.gov/mpptool, allows dairy farmers to quickly and easily combine unique operation data and other key variables to calculate their coverage needs based on price projections. Producers can also review historical data or estimate future coverage based on data projections.  The secure site can be accessed via computer, Smartphone, tablet or any other platform, 24 hours a day, seven days a week. 

For more information, visit FSA online at www.fsa.usda.gov/dairy or stop by a local FSA office to learn more about the MPP-Dairy.

November Interest Rates
and Important Dates to Remember

Illinois Farm Service Agency
3500 Wabash Ave.
Springfield, IL 62711

Phone: [phone]
Fax: [phone]

www.fsa.usda.gov/il

State Executive Director:
William J. Graff

Acting State Committee:
Jill Appell - Chairperson
Brenda Hill - Member
Joyce Matthews - Member
Gordon Stine - Member

Executive Officer:
Rick Graden

Administrative Officer:
Dan Puccetti

Division Chiefs:
Doug Bailey
Randy Tillman

Acting Division Chiefs:
Richard Damery
Deb Kirkland

To find contact information for your local office go to www.fsa.usda.gov/il

USDA is an equal opportunity provider, employer and lender. To file a complaint of discrimination, write: USDA, Office of the Assistant Secretary for Civil Rights, Office of Adjudication, 1400 Independence Ave., SW, Washington, DC 20250-9410 or call [phone] (Toll-free Customer Service), [phone] (Local or Federal relay), [phone] (Relay voice users).