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Conveying Concerns

The National Cotton Council (NCC) continues to monitor 2014 farm law implementation and provide USDA with input for ensuring that the legislation’s final rules do not undermine U.S. cotton’s competitiveness.

National Cotton CouncilHow are payment limits being implemented?

■ The farm bill institutes a unified $125,000 payment limit applying to Agriculture Risk Coverage and Price Loss Coverage payments, as well as marketing loan gains and loan deficiency payments.

The NCC formed a working group to work with USDA on a reporting and tracking system so producers and cooperatives can know their status relative to the unified payment limit. NCC staff and industry officials continue to meet with the Farm Service Agency on how best to manage the marketing loan program in order to maintain cotton flow and minimize forfeitures. That effort was reinforced with NCC Director Ronnie Lee’s testimony before a Senate Agriculture, Nutrition & Forestry Committee hearing. The Georgia producer emphasized that 1) tracking total benefits that have accrued to the limit has proven to be a complex and challenging task for USDA and 2) the uncertainty created by the limit works to undermine the marketing loan’s effectiveness.

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NCC Director Ronnie Lee’s testimony conveyed concerns regarding payment limits.

Did the NCC also respond to the actively engaged rule?

■ Ronnie Lee’s testimony also urged that any actively engaged provision changes do not exceed the scope of the statute in the 2014 farm law, which required the Agriculture Secretary to revise regulations defining “actively engaged in farming” for farm program eligibility for the 2016 crop. The NCC joined with other farm organizations on joint comments to the proposed rule. The comments concurred with the exemption from the rule for family partnerships and joint ventures. However, the law has a restrictive definition of family, meaning lineal relations (great grandparent, grandparent, parent, etc. including in-laws). The groups recommended consideration for maintaining an exemption for family operations that become non-lineal. The groups stated that the proposed rule exceeded Congressional intent by imposing additional, unneeded restrictions for non-family operations. Specifically, the groups oppose requirements of minimum hours, maintenance of logs and a limit of managers eligible for management contribution. What about crop insurance?

■ The NCC submitted detailed comments to USDA’s Risk Management Agency regarding proposed changes to Section 508(h) of the Federal Crop Insurance Act, which allows private parties to develop insurance products that are in the best interests of producers, follow sound insurance principles that are actuarially appropriate and then submit them to the Federal Crop Insurance Corporation board for approval or rejection.

The NCC also joined with more than 40 groups on comments regarding USDA’s interim rule linking conservation compliance with crop insurance. The comments specifically noted that simple differences such as the use of a personal tax identification number versus a business tax identification number could potentially flag a producer for additional scrutiny under this rule. USDA was asked to reconcile these differences in a timely manner. The comments also requested clarity on which USDA agency will inform a producer who’s found not to be in compliance.

Gary Adams was elevated to president/chief executive officer of the National Cotton Council in February 2015. He and other NCC leaders contribute to this Cotton Farming magazine page.