Signing your farm up for the new farm bill will take a team effort involving you and your landowners.
The way the law is written, any changes in program bases or yields must be approved and signed-off on by all landowners, and the final deadline to make these selections is April 1, 2003. For all practical purposes, however, those decisions are being made now as growers sign up their farms for the 2002 and 2003 crop seasons.
“I encourage you to meet with your landowners to discuss this, and let them make the determination. Some of the situations seem pretty cut and dry; still, let your landowners make the decision,” advises Robin Richardson, Farm Service Agency county director for Sunflower County, Miss.
While a lot of landowners will be right knee deep in the middle of this and will be ready to make these decisions, some won't have a clue and they are going to be looking to you for guidance,” he says.
“If you think you don't want to update bases so there's nothing you have to do, that's wrong.
“You have to start from the word go on this process. You have to work with your landowners to make a decision. Even if you've never planted soybeans, and you're going to keep the exact same basis, the landowner still has to make that decision and sign off on it.”
Updating program bases on multiple-ownership farms may also affect some landowners differently than it does others. “You can't just look at the farm as a whole and say, ‘I'm a whole lot better off not updating basis, and just adding soybeans.’ You may have one owner in there who had cotton planted on his tract for four years and never had any cotton base before. That owner may want to update crop bases,” Richardson says.
In the event that landowners cannot agree on base and yield election, 2002 reconstitutions are authorized by the 2002 farm bill.
However, it's not a simple process to do so, and both the owner of the affected tract of land and the farm operator must request the reconstitution. If you can't make a decision on the farm because one owner doesn't agree to it, unless you and that owner file the request to reconstitute, it's not going to reconstitute.
According to Farm Service Agency officials, requested farm reconstitutions will be split down to the owner level based on the owners that existed as of Oct. 1, 2002, using the default method to split out crop bases. Farm combinations are not allowed. “The push from Washington, D.C., right now is to go to single-ownership farms,” Richardson says.
Once a reconstitution request is approved, the producer must refund 2002 program payments and receivables will be established. Then once the reconstitution is completed, the landowners will make their base selections, the farm will be signed back up, and full program payments under the 2002 farm bill will be made. “In essence, you are getting the same payment when all is said and done,” Richardson says.
Multiple-producer farms could be adversely affected by performing a reconstitution, he says. “In farms where one entity is farming one crop, and one entity is farming another, we'll have to split them out. We can't split them the way the crops were actually worked on the farm. If you do this, you had better be careful because it could have an effect on the payments that were previously earned on the farm.”
In those cases where multiple landowners cannot agree to a program update method and do not request a farm reconstitution by April 1, 2003, that farm will retain its current bases and any eligible oilseeds will be added. “If you have a farm that nobody can reach an agreement on, you're not going to do anything with it and come April 1, 2003, we're going to default it to option two and then you'll have the opportunity to sign it up,” Richardson says.
For those producers interested in obtaining a power of attorney for a landowner, Richardson cautions, “The one-time decision that is made here before April 1 is a decision that is going to carry forward for the six years of this farm bill. It's also going to apply to any farm bill that is passed subsequent to this program. You are making a decision on behalf of the landowner, and if somewhere down the line something changes that adversely affects that farm, I wouldn't necessary want to be in your shoes.”
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