USDA to Trim Direct Payments to Meet Sequester Target
March 22, 2013

The U.S. Department of Agriculture's Farm Service Agency (FSA) notified Congress of its intention to capture the required sequester savings by reducing payments made through the direct payment program account by up to 8.5 percent. The action follows an initial step, taken March 1, when FSA temporarily suspended the disbursement of payments for many FSA programs. 
 
"There is a 30 day congressional notification period that must pass before we can move forward," explained FSA Administrator Juan Garcia in an e-mail sent to staff on Tuesday. "Therefore, payments in the following programs will continue to be deferred for the next 30 days: 2011 Supplemental Revenue Assistance Payments Program (SURE), Noninsured Crop Disaster Assistance Program (NAP) for both 2012 and 2013 crop years and the Milk Income Loss Contract Program. After 30 days, we intend to resume making these program payments in full." 
 
Garcia said the reduction only to direct payments will "minimize disruption to farmers and ranchers who have already received and will soon be seeking disaster assistance through SURE or NAP. It will allow producers who suffered disasters to be fully paid, and it will avoid having to require about 350,000 producers to refund 5.1 percent of the payments they have already received. It will also prevent the department from incurring a significant administrative burden that would be required to recoup these payments." 
 
"The American Sheep Industry Association (ASI) is pleased that NAP payments will be completed this spring as we have producers across the country that have dealt with the worst drought in 50 years as well as record high feed costs this spring yet," said Peter Orwick, ASI executive director. 
 
Reprinted in part from Agri-Pulse.com