WASHINGTON Oct 8 U.S. lawmakers must tighten
farm subsidy rules to make sure the money goes only to active
farmers and landowners, a congressional report said on Tuesday,
warning that millions of dollars are at stake.
Senator Charles Grassley, who requested the report, said it
showed "there is still far too much subterfuge" involved in the
way farm payments are made and limits applied.
The Iowa Republican called for "closing loopholes that allow
non-farmers to game the system."
The House and Senate have proposed stricter eligibility
standards as part of five-year omnibus farm bills. The new farm
law is a year overdue. Work has been slowed by disagreements
over how much to cut from U.S. nutrition programs, commonly
known as food stamps.
The Government Accountability Office, the investigative arm
of Congress, looked at rules intended to restrict subsidies to
active farmers. To count as a farmer, applicants must provide
capital, equipment or land and labor or management of a farm.
In its 60-page report the GAO said it found cases where
people who claimed subsidies for management of a farm located
hundreds of miles from their homes, or farms with several people
who said they provided active management and merited subsidy
payments of up to $40,000 each.
As one example, GAO said a Midwestern farm covering 25,000
acres received $400,000 in payments in 2012 with 11 members of
the same family said to provide management, from an 88-year-old
resident of south Florida to an 18-year-old who began receiving
payments at age 16.
"The federal government risks distributing millions of
dollars to individuals who have little actual involvement in
farming operations," said the report.
It noted broad definitions of what counts as "management,"
and the difficulty in verifying the role performed by farm
Ferd Hoefner of the small-farm group National Sustainable
Agriculture Coalition said the current definition of farm
management was "a wide-open loophole ... used to get almost
unlimited payments" to large operations.
The House and Senate bills would allow only one person per
farm to claim subsidies as the manager. They also would set a
$250,000 per limit on payments for a couple and bar payments to
the wealthiest operators. The two bills, which are yet to be
reconciled, have different levels for the cut-off point for
There is no overall payment limit at present although
subsidies are barred to people with more than $1.25 million a
year in adjusted gross income from farm and off-farm sources.
The GAO is currently closed because of the U.S. federal
government shutdown. Grassley's office released the report on
(Reporting by Charles Abbott, Editing by Ros Krasny and Ken