Trump Administration Gets Bad Press, a Bit Unfairly

Our president would argue there's no news in my title. But while I'd argue the administration often deserves all the poor publicity it gets, articles in the press today are a bit unfair.

I'm referring to an article in the NYTimes on the progress of payments under Trump's "Market Facilitation Program" of providing payments to producers of commodities whose sale has been impacted by Trump's tariffs. The criticism is partly that FSA has been slow in getting payments out to farmers (and also that the payment rates aren't equitable.)

I'll make my point by citing a blog I follow: Life on a Colorado Farm.  (I recommend it for the great photos and the glimpses into the rhythms of farm life.)  The author reported today they'd just finished corn harvest.  Why is that important?  Corn growers can qualify for MFP payments only if and when they can provide production evidence, like warehouse receipts.  I don't know that they're going to apply for MFP payments (my guess is not), but today is the first day they could have a completed application. 

While it's true grain harvests are winding down, the USDA-NASS graphs show soybean harvests span about 2 months, from mid September when it begins to now, when it's 85-90 percent.  What that time frame could mean is that FSA offices receiving the applications are overwhelmed.

MFP and Farmers.gov

Got a tweet announcing the latest figures on MFP applications and payments.  I now can't find the tweet, not sure what's the matter. 

Two things I'd like farmers.gov to do:

1. provide online access to FSA data, like the applications and payments.  It seems to me that FSA administrators at each level should be watching the data.  (That was true when I worked for them, but we never did. But with the centralization of the payment process it should be easy to do, and there's no privacy concerns that I can see.)
2. provide a user-friendly interface to the USDA data silos.  Does anyone outside USDA understand which data ERS has and which data NASS has?  Damned few, is my guess.  It shouldn't be too hard to present the data without regard to the organizational parents.

MFP Instructions from FSA

USDA has added almonds and cherries to the eligible commodities for MFP payments, and FSA issued a new expanded notice covering them plus other changes.

The changes seem to be tightening up the program:

1. a subparagraph on spotchecking production evidence
2. more detailed instructions on reviewing evidence for reasonableness (though I don't see any definition of the "Other" category of acceptable evidence.  I don't remember that from 25 years ago--maybe it's been added and is now understood by everyone?) 

And the addition of a worksheet for making the payment calculations and computing a total payment amount.

MFP and Privacy of Data

Article in the newspaper, lost track of which one, reporting that FSA had issued something like $23 million in MFP payments so far.

I'm impressed less by the speed with which the agency was able to issue the payments than by the ability to provide statistics.  With the centralized payment process the payment data should have been easy but they're also reported applications made and paid.  I'm not sure what's supporting that--maybe the business processes are in the cloud, making such data easy?

The article also went on to note that EWG was asking for release of the payment data.  That reminds me of this notice.  I've read it a couple times and still don't understand it, perhaps because I'm remembering that the 2008 or 2012 farm bill included a prohibition on providing payment data.  My memory may be wrong, or the law may have changed in more recent farm bills.

Congressional Research Service on Market Facilitation Program

Here's the CRS explanation and commentary on the MFP.

Two paragraphs from the summary:

Most farm commodity and advocacy groups have been supportive of the trade aid package even as they have called for solutions that restore export activity.
However, stakeholders have begun to question the equity of the distribution of MFP payments due to difficulties in isolating specific market effects and the lack of transparency around the formulas for determining MFP payment rates. Some trade economists and market watchers have suggested that its potential effects could be longer lasting because the imposition of tariffs and retaliatory tariffs have created uncertainty about U.S. trade policy behavior. Further, the use of CCC authority to mitigate tariff-related losses may establish a precedent for future situations.

Those Hard-Working Bureaucrats at FSA

Failed to mention yesterday that the instructions for MFP were issued timely.  Signup opened yesterday, and the notice providing the instructions was issued at 1:00 am. Sept. 4.

Never let it be said that FSA bureaucrats were asleep on the job.

CCC-910 for Market Facilitation Program

FSA now has the form approved by OMB and up and operational on its website. (Or, actually on the farmers.gov website.)

Since I've started off nitpicking the program and it's a convenient subject to blog about, some more comments. (And there aren't many people left at FSA from my time there, which is a consideration--don't want to be unfair to friends, but unfair to strangers is another matter.)

I wonder why the producer's certification only notes that failure to certify production accurately will result in loss of benefits.  I'm too lazy to check, but didn't FSA used to note penalties for false certification--18 U.S.C. something or other? I also wonder why there's no language either tying the production to the producer's farm(s) or certifying that it is the total production from all farms in which the producer has an interest.  Don't know if there's an appendix to this contract.  Nor do I know the significance of the "adjusted production" column.

I'm a bit disappointed that FSA asks for a producer's fax number, but not her email address. 

I note with some bemusement that the nondiscrimination statement has been modified since my time--I've bolded the changes.

"In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, political beliefs, or reprisal or retaliation for prior civil rights activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). Remedies and complaint filing deadlines vary by program or incident."

I note the farmers.gov website promises the ability to file electronically.  Maybe I've found another area to nitpick. 

No Instructions or Form for MFP

At least, I can't find any at the appropriate places on the fsa.usda website or on the farmers.gov website.  That site provides links to the other forms which are required or may be used.

Any Double-Dipping on MFP

Still no FSA notice on the MFP, but there is a notice on the Dairy Margin Protection Program.  I have not kept up with program, but from the following Background paragraphs my guess is it's a revenue insurance type program, but run by FSA and not RMA.

"MPP-Dairy payments are triggered when the difference between the National all milk price and the National average feed cost (the margin) falls below the producer-selected margin trigger, ranging from $4 to $8, calculated monthly. USDA prices for milk and feed components required to determine the National average margin for July were released on August 29, 2018. The actual National average margin for July is $6.71815/cwt. As a result, dairy operations that elected margin coverage of $7.00, $7.50 and $8 will be issued a payment.

Payments for margins triggered will be issued directly to producers. MPP-Dairy payments issued will not be offset by premium balances due. The full balance of the premium is due September 28, 2018."

It raises the question to me, which I may have mentioned before, of whether there will be double-dipping under the MFP.  In other words, crop insurance has products, on which I'm not expert, which can cover loss of revenue from a base, a loss which might be caused by production losses and/or market price dips.  Producers have to sign up for such products and pay premiums.  MFP is essentially a free one-shot policy covering market price dips. So producers who signed up for the DMPP or a revenue crop insurance policy will receive two payments for the same loss.  That doesn't seem right, but from a program administration standpoint it immensely simplifies the operation.

MFP Form Is Missing?

USDA now has some material on the MFP other than the press release up its website, farmers.gov.

They give the name of the application form, CCC-910, but it's not available in the FSA Forms database.  Nor is there any notice on MFP listed in FSA notices.  I assume any training for administering the program would also show up in a notice there.

MFP Notice of Funds Availability

As usual, I'm fast and sloppy.  OFR has the NOFA for MFP here.

OMB gave FSA a 6-month emergency approval for the paperwork.  (Why didn't they do that for ASCS back in the day when I was handling them.)

The NOFA does have the Catalog of Federal Domestic Assistance number for MFP--10.123.

I have to carp at this paragraph: "If supporting documentation is required for the amount of actual production and for ownership share, it needs to be verifiable records that substantiate the reported amounts. The participant’s production for the commodity is based on verifiable or reliable production records. Examples of reliable production records include evidence provided by the participant that is used to substantiate the amount of production reported when verifiable records are not available, including copies of receipts, ledgers of income, income statements of [? shouldn't it be "or,"]deposit slips, register tapes, invoices for custom harvesting, and records to verify production costs, contemporaneous measurements, truck scale tickets, or contemporaneous diaries that are determined acceptable by the county committee."

The first sentence and second sentences seem to be at odds--my guess is the intention is clarified by the definitions of "verifiable" and "reliable" (but not verifiable) evidence in the next paragraphs, but that isn't what the first sentence says.

Where Are the Regulations and the Forms?

USDA has officially announced Sept. 4 as the beginning date to sign up for the Market Facilitation Program. That's the press release.

What I, as an old FSA bureaucrat, am wondering is:

1. when will FSA issue a directive, presumably a notice, on the MFP?
2. when will the regulations (presumably an interim final reg) be published by the Office of the Federal Register.  Note: I typed the previous sentence, then did a search on the OFR site.  The regulation was filed with OFR this morning.  It has this notation:  "This document is scheduled to be published in the Federal Register on 08/30/2018 and available online at https://federalregister.gov/d/2018-18842, and on govinfo.gov"
3. when will the signup form(s) be available?  They have to be cleared by OMB. 

Some comments on the regulations, written as I scan it.

• USDA OGC and OMB have come up with a dodge which is new to me--a "Notice of Funds Availability".  I've not seen such a document before, but Googling shows it's been used by other departments.  My guess is the lawyers approved (lawyers can approve anything if the pressure is on) this as a measure to work around existing rules in the Administrative Procedure Act and Trump's EEO--I'd bet a fair amount that NOFA's aren't considered "regulations" for those purposes.  Note: There's some logic to the step--the "regulations" which get conservatives upset usually shape behavior: OSHA and EPA type regs.  The regulations for farm program payments used to be considered "regulations", but no body was forced to take the payments--the regulations were really the conditions for receiving the payment.  
• I'm waiting with bated breath to see whether the applications for payment get OMB clearance.  Seems to me they have to, but the MFP regs say the form will be specified in the NOFA.
• Turns out OMB has a category of "transfer rules" which are not covered by the two for one Trump rule (doing away with two old regulations for each new regulation).  That dates back to April 2017.
• I see one glitch here: "The title and number of the Federal Domestic Assistance Program found in the Catalog of Federal Domestic Assistance to which this rule applies is TBD – Market Facilitation Program and number".  The number wasn't assigned.
• I think it's fair to assume that eligibility and payments are on a farm basis, rather than an operator.  

I never was an expert on the price support side of FSA; they are the people who dealt with production evidence.  With that said, where could a dishonest producer game the program?  The incentive for fraud would be to exaggerate one's production, by duplicating evidence to multiple county offices, forging evidence, or having different producers claiming ownership of the same production.  FSA has long experience with production evidence, so existing validation checks and spotchecks will likely work. However, as a cynic, I'm sure a few farmers will try to get more than they should.

Market Facilitation Program--Signup Sept. 4

Here's the USDA press release on the programs to offset the impacts of Trump's trade war on farmers.

Some things strike me, though my information is 20 years out of date.

The MFP (administered by FSA) covers pork and milk, as well as the commodities: cotton, corn, wheat, soybeans, and sorghum (not sure if ELS cotton is covered); oats, rice, and barley are not.  While FSA is used to collecting production data for the commodities, it has less experience with pork and milk.

Applications for  the "first payment period" starts Sept. 4 (actually presumably the later of Sept 4 and the completion of harvest for the commodities), but it's not clear to me what the payment period means--presumably the 2018 harvest for the commodities, while pork and milk are based on snapshot data as of August 1 and June 1, respectively.

Payment's on 50 percent of actual production, with the second payment period beginning Dec. 2018 to cover the remaining 50 percent.  Presumably that will be announced if there's no end to the war or farm prices don't bounce back.

[Addition: not clear whether application is on a farm basis, or the entire farming operation.  Possibly could be either, but the entire operation would limit the possibility of moving production evidence from one farm to another.]