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. 

Alex Haley and Cornell

It turns out that Alex Haley, the author of "Roots" was born in Ithaca, NY, while his father Simon was getting his Masters in agriculture at Cornell.

Over the first hundred years of Cornell's existence it educated some African-Americans, though a man from Haiti was the first student of African descent in 1869.

IMO because of its different colleges, partly due to its land-grant status, Cornell had an easier time with diversity than did its competitors over that period.  For blacks the record was tokenism, a few students every year at best.  Cornell did better with Asian students, enrolling its first in 1870 along with its first woman. But notoriously, when the civil rights movement started impacting colleges in the 1960's, it didn't do any better than other schools.

Canada and Supply Management for Dairy

One of the biggest issues in the renegotiation of NAFTA with Canada is their desire to maintain their system of supply management for dairy.  Here's a site with statistical data on the industry.  The two big provinces are Ontario and Quebec.  As one can see from this chart there's little variation in cow numbers over the last 15 years (2004-2018).  But if you look at the number of farms, there has been roughly 1/3 reduction in farm numbers over the same period (17,000 to 11,000).

From ERS  (the copy and paste process loses the formating.  I've bolded the two big points): Midpoints increased for each commodity over 1987-2012, but the rate of increase varies widely, with dramatic long-term changes in egg, hog, and dairy production (table 9). The midpoint flock size in egg layers increased to 925,975 birds in 2012 from 117,839 in 1987 (and just over 62,000 in 1982); the midpoint for hog removals rose to 40,000 in 2012 from 1,200 in 1987; and the midpoint dairy cow herd rose to 900 cows in 2012 from 80 in 1987. The broiler and fed cattle industries show continued consolidation, with 2012 midpoints a bit more than double their values in 1987. However, each underwent striking changes in organization and technology well before the series starts in 1987 (MacDonald and McBride, 2009). Table 9 Consolidation in livestock sectors, 1987-2012 Commodity 1987 1997 2007 2012 Change (percent) 1987-2012 2007-2012 Sales midpoint: Number of head sold or removed Broilers 300,000 480,000 681,600 680,000 127 -0.1 Fed cattle 17,532 38,000 35,000 38,369 119 10 Hogs and pigs 1,200 11,000 30,000 40,000 3,233 33 Turkeys 120,000 137,246 157,000 160,000 33 2 Inventory midpoint: Number of head in herd/flock Beef cows 89 100 110 110 24 0 Egg layers 117,839 300,000 872,500 925,975 686 6 Milk cows 80 140 570 900 1,025 58 Source: USDA, Economic Research Service, compiled from census of agriculture data.

Bottom line: while Canadian dairy farms have declined in number, the rate of decline in the US is higher. 

I'm reminded of the supply management system the US used to have for tobacco, now ended.  It had a similar effect: slowing the transformation of the industry.

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.]

Honor the Silent Generation

Ross Douthat had a nice tweet on Sen. McCain, but he led off by calling him a member of the Boomer generation.  He was quickly corrected, by many, including me.

We Silents get no respect--we're stuck between the so-called "Greatest Generation" and the big Boomers.  We got no president--all our candidates lost (Mondale, Dukakis, McCain), and we lost or drew our wars: Korea and Vietnam.  But for all that, we survived and so did the country.