Saturday, May 03, 2008

Pay Limit--Confusing Reports

From the ARgus Leader in SD:

"The tentative deal would base farm program payment limitations on whether the recipients are farmers or non-farmers, Herseth Sandlin said. In 2009, landowners with adjusted gross incomes of more than $750,000 who are not farmers would be prohibited from receiving farm payments. The amount would fall to $650,000 in 2010 and to $500,000 in 2011, she said. The income cap for farmers would be $950,000.

Farmers making more than that could still benefit from farm programs but would lose 10 percent of their direct payments for every $100,000 in income over the $950,000 cap, Herseth Sandlin said.

The tentative deal would also prohibit the U.S. Department of Agriculture from closing Farm Service Agency offices for two years, she said.

"(However) nothing is really final until the end," she said."
Not sure what "a farmer" means in this context. This might mean a three tier system:
  1. An owner of cash-rented land who doesn't share in the risk of the crop is neither actively engaged nor a farmer--no payments, period.
  2. An owner of share-rented land is not a farmer but does share in the risk so can receive payments providing AGI is under the cap.
  3. A tenant (by share or cash lease) is actively engaged in farming and a "farmer", so can receive payments but at declining rate if AGI is over the cap (which means no payment if AGI is $2 million or more).
As the senator says, we'll see.

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