USDA is focused on generating long-term stability and success for distressed borrowers.

USDA announced that distressed borrowers with qualifying USDA farm loans have already received nearly $800 million in assistance, as part of the $3.1 billion in assistance for distressed farm loan borrowers provided through Section 22006 of the Inflation Reduction Act (IRA). The IRA directed USDA to expedite assistance to distressed borrowers of direct or guaranteed loans administered by USDA’s Farm Service Agency (FSA) whose operations face financial risk.

Today’s announcement kicks off a process to provide assistance to distressed farm loan borrowers using several complementary approaches, with the goal of keeping them farming, removing obstacles that currently prevent many of these borrowers from returning to farming, and improving the way that USDA approaches borrowing and servicing. Through this assistance, USDA is focused on generating long-term stability and success for distressed borrowers.

Work has already started to bring some relief to distressed farmers. As of today, over 13,000 borrowers have already benefited from the resources provided under the Inflation Reduction Act as follows:

• Approximately 11,000 delinquent direct and guaranteed borrowers had their accounts brought current. USDA also paid the next scheduled annual installment for these direct loan borrowers giving them peace of mind in the near term.
• Approximately 2,100 borrowers who had their farms foreclosed on and still had remaining debt have had this debt resolved in order to cease debt collections and garnishment relieving that burden that has made getting a fresh start more difficult.

In addition to the automatic assistance already provided, USDA has also outlined steps to administer up to an additional $500 million in payments to benefit the following distressed borrowers:

• USDA will administer $66 million in separate automatic payments, using COVID-19 pandemic relief funds, to support up to 7,000 direct loan borrowers who used FSA’s disaster-set-aside option during the pandemic to move their scheduled payments to the end of their loans.
• USDA is also initiating two case-by-case processes to provide additional assistance to farm loan borrowers. Under the first new process, FSA will review and assist with delinquencies from 1,600 complex cases, including cases in which borrowers are facing bankruptcy or foreclosure. The second new process will add a new option using existing direct loan servicing criteria to intervene more quickly and help an estimated 14,000 financially distressed borrowers who request assistance to avoid even becoming delinquent.

More details on each of the categories of assistance, including a downloadable fact sheet, are available on the Inflation Reduction Act webpage on farmers.gov.

Similar to other USDA assistance, all of these payments will be reported as income and borrowers are encouraged to consult their tax advisors. USDA also has resources and partnerships with cooperators who can provide additional assistance and help borrowers navigate the process.

The announcement today is only the first step in USDA’s efforts to provide assistance to distressed farm loan borrowers and respond to farmers and to improve the loan servicing efforts at USDA by adding more tools and relaxing unnecessary restrictions. Additional announcements and investments in assistance will be made as USDA institutes these additional changes and improvements.

This effort will ultimately also include adding more tools and relaxing unnecessary restrictions through assistance made possible by Congress through the IRA. Further assistance and changes to the approach will be made in subsequent phases.

Background

USDA provides access to credit to approximately 115,000 producers who cannot obtain sufficient commercial credit through direct and guaranteed farm loans, which do not include farm storage facility loans or marketing assistance loans.  With the funds and direction Congress provided in Section 22006 of IRA, USDA is taking action to immediately provide relief to qualifying distressed borrowers whose operations are at financial risk while working on making transformational changes to how USDA goes about loan servicing in the long run so that borrowers are provided the flexibility and opportunities needed to address the inherent risks and unpredictability associated with agricultural operations and remain in good financial standing.

In January 2021, USDA suspended foreclosures and other adverse actions on direct farm loans due to the pandemic and encouraged guaranteed lenders to follow suit. Last week, USDA reiterated this request to guaranteed lenders to provide time for the full set of IRA distressed borrower assistance to be made available before lenders take irreparable actions.

Producers can explore available loan options using the Farm Loan Discovery Tool on farmers.gov (also available in Spanish) or by contacting their local USDA Service Center. Producers can also call the FSA call center at 877-508-8364 between 8 a.m. and 7 p.m. Eastern. USDA has tax-related resources available at farmers.gov/taxes.

The U.S. Department of Agriculture (USDA) launched a new online tool to help farmers and ranchers better navigate the farm loan application process. This uniform application process will help to ensure all farm loan applicants receive equal support and have a consistent customer experience with USDA’s Farm Service Agency (FSA) regardless of their individual circumstances.  

USDA experiences a high rate of incomplete or withdrawn applications, particularly among underserved customers, due in part to a challenging and lengthy paper-based application process. The Loan Assistance Tool is available 24/7 and gives customers an online step-by-step guide that supplements the support they receive when working in person with a USDA employee, providing materials that may help an applicant prepare their loan application in one tool. 

Farmers can access the Loan Assistance Tool by visiting farmers.gov/farm-loan-assistance-tool  and clicking the ‘Get Started’ button. From here they can follow the prompts to complete the Eligibility Self-Assessment and start the farm loan journey. The tool is built to run on any modern browser like Chrome, Edge, Firefox, or the Safari browser, and is fully functional on mobile devices. It does not work in Internet Explorer.  

The Loan Assistance Tool is the first of multiple farm loan process improvements that will be available to USDA customers on farmers.gov in the future. Other improvements and tools that are anticipated to launch in 2023 include: 

• A streamlined and simplified direct loan application, reduced from 29 pages to 13 pages. 
• An interactive online direct loan application that gives customers a paperless and electronic signature option, along with the ability to attach supporting documents such as tax returns.  
• An online direct loan repayment feature that relieves borrowers from the necessity of calling, mailing, or visiting a local Service Center to pay a loan installment. 

Agricultural producers in State who have not yet completed their crop acreage reports after planting should make an appointment with their Farm Service Agency (FSA) office before the applicable deadline.

An acreage report documents a crop grown on a farm or ranch and its intended uses. Filing an accurate and timely acreage report for all crops and land uses, including failed acreage and prevented planted acreage, can prevent the loss of benefits.

The following acreage reporting dates are applicable in New Jersey:

• November 15 - Fall planted small grains including those intended for cover that may be harvested
• January 1 - Honey
• January 15 -  Apples, blueberries, cranberries, peaches, grapes, & strawberries
• May 31 - 2023 nursery crops
• July 15 - corn, soybeans, spring feed grains, forage, CRP, hemp & most other crops                   
• August 15 - processing beans
• September 30 - 2023 Value Loss (i.e. Christmas trees, cut flowers, turf grass/sod, aquaculture). 

Contact your Service Center to set up an in-person or phone appointment.

To file a crop acreage report, you will need to provide:

• Crop and crop type or variety.
• Intended use of the crop.
• Number of acres of the crop.
• Map with approximate boundaries for the crop.
• Planting date(s).
• Planting pattern, when applicable.
• Producer shares.
• Irrigation practice(s).
• Acreage prevented from planting, when applicable.
• Other information as required.

Acreage Reporting Details

The following exceptions apply to acreage reporting dates:

• If the crop has not been planted by the acreage reporting date, then the acreage must be reported no later than 15 calendar days after planting is completed.
• If a producer acquires additional acreage after the acreage reporting date, then the acreage must be reported no later than 30 calendar days after purchase or acquiring the lease. Appropriate documentation must be provided to the county office.
• Noninsured Crop Disaster Assistance Program (NAP) policy holders should note that the acreage reporting date for NAP-covered crops is the earlier of the dates listed above or 15 calendar days before grazing or harvesting of the crop begins

Producers should also report crop acreage they intended to plant, but due to natural disaster, were unable to plant. Prevented planting acreage must be reported on form CCC-576, Notice of Loss, no later than 15 calendar days after the final planting date as established by FSA and USDA’s Risk Management Agency.

More Information

For questions, please contact your local FSA office. To locate your local FSA office visit farmers.gov/service-center-locator.

Agricultural producers and handlers who are certified organic, along with producers and handlers who are transitioning to organic production, can now apply for the U.S. Department of Agriculture’s (USDA) Organic and Transitional Education Certification Program (OTECP) and Organic Certification Cost Share Program (OCCSP), which help producers and handlers cover the cost of organic certification, along with other related expenses. Applications for OTECP and OCCSP are both due October 31, 2022. 

OTECP covers:  

• Certification costs for organic producers and handlers (25% up to $250 per category). 
• Eligible expenses for transitional producers, including fees for pre-certification inspections and development of an organic system plan (75% up to $750). 
• Registration fees for educational events (75% up to $200). 
• Soil testing (75% up to $100).  

Meanwhile, OCCSP covers 50% or up to $500 per category of certification costs in 2022.  

This cost share for certification is available for each of these categories: crops, wild crops, livestock, processing/handling and State organic program fees.   

Producers can receive cost share through both OTECP and OCCSP. Both OTECP and OCCSP cover costs incurred from October 1, 2021, to September 30, 2022.  Producers have until October 31, 2022 to file applications, and FSA will make payments as applications are received.  

To apply, producers and handlers should contact the Farm Service Agency (FSA) at their local USDA Service Center. As part of completing the OCCSP applications, producers and handlers will need to provide documentation of their organic certification and eligible expenses. Organic producers and handlers may also apply for OCCSP through participating State agencies.   

Additional details can be found on the OTECP and OCCSP webpages. 

The USDA Farm Service Agency (FSA) and partners are hosting a webinar for stakeholders and producers that focuses on the new Food Safety Certification for Specialty Crops (FSCSC) program. FSCSC will provide up to $200 million in assistance for specialty crop producers who incur eligible on-farm food safety program expenses to obtain or renew a food safety certification in calendar years 2022 or 2023.

The webinar will be held on Thursday, Nov. 3, 2022, from 2:00 to 3:00 p.m. eastern and will be recorded. Please register in advance of the webinar at www.zoomgov.com/webinar/register/WN_v4FQsCFLROmC8ZvuZ73VrA.

Webinar topics include:

• FSCSC overview and eligibility requirements
• Overview of Food Safety Certification Requirements for Specialty Crops by USDA’s Agricultural Marketing Service and Toolkit Overview for GAP and Food Safety Plan Quality Management Systems by the National Association of State Departments of Agriculture
• Additional resources

To be eligible for FSCSC, an applicant must:

• Have obtained or renewed a:
  • 2022 food safety certification that was issued between June 21, 2022 and December 31, 2022; or
  • 2023 food safety certification issued during the 2023 calendar year, and 
• Have paid eligible expenses. Expenses that have been incurred by the applicant, but have not yet been paid, will not be eligible.
• Be a specialty crop operation; and meet the definition of a small business or very small business.
  • A small business means an applicant that had an average annual monetary value of specialty crops the applicant sold during the 3-year period preceding the program year of more than $250,000 but not more than $500,000.  
  • A very small business means an applicant that had an average annual monetary value of specialty crops the applicant sold during the 3-year period preceding the program year of no more than $250,000.

The FSCSC application period for 2022 runs through January 31, 2023, and the application period for 2023 will be announced at a later date.

Producers can visit farmers.gov/food-safety for additional program details, eligibility information and forms needed to apply. 

Agricultural producers can now change election and enroll in the Agriculture Risk Coverage (ARC) and Price Loss Coverage programs for the 2023 crop year, two key safety net programs offered by the U.S. Department of Agriculture (USDA). Signup began Monday, and producers have until March 15, 2023, to enroll in these two programs. Additionally, USDA’s Farm Service Agency (FSA) has started issuing payments totaling more than $255 million to producers with 2021 crops that have triggered payments through ARC or PLC.  

2023 Elections and Enrollment   

Producers can elect coverage and enroll in ARC-County (ARC-CO) or PLC, which provide crop-by-crop protection, or ARC-Individual (ARC-IC), which protects the entire farm. Although election changes for 2023 are optional, producers must enroll through a signed contract each year. Also, if a producer has a multi-year contract on the farm and makes an election change for 2023, they must sign a new contract.    

If producers do not submit their election by the March 15, 2023 deadline, their election remains the same as their 2022 election for crops on the farm.  Farm owners cannot enroll in either program unless they have a share interest in the farm.     

Covered commodities include barley, canola, large and small chickpeas, corn, crambe, flaxseed, grain sorghum, lentils, mustard seed, oats, peanuts, dry peas, rapeseed, long grain rice, medium and short grain rice, safflower seed, seed cotton, sesame, soybeans, sunflower seed and wheat.    

Web-Based Decision Tools   

In partnership with USDA, the University of Illinois and Texas A&M University offer web-based decision tools to assist producers in making informed, educated decisions using crop data specific to their respective farming operations. Tools include:   

• Gardner-farmdoc Payment Calculator, a tool available through the University of Illinois allows producers to estimate payments for farms and counties for ARC-CO and PLC.  
• ARC and PLC Decision Tool, a tool available through Texas A&M that allows producers to obtain basic information regarding the decision and factors that should be taken into consideration such as future commodity prices and historic yields to estimate payments for 2022.   

2021 Payments and Contracts  

ARC and PLC payments for a given crop year are paid out the following fall to allow actual county yields and the Market Year Average prices to be finalized. This month, FSA processed payments to producers enrolled in 2021 ARC-CO, ARC-IC and PLC for covered commodities that triggered for the crop year.   

For ARC-CO, producers can view the 2021 ARC-CO Benchmark Yields and Revenues online database, for payment rates applicable to their county and each covered commodity. For PLC, payments have triggered for rapeseed and peanuts. 

For ARC-IC, producers should contact their local FSA office for additional information pertaining to 2021 payment information, which relies on producer-specific yields for the crop and farm to determine benchmark yields and actual year yields when calculating revenues.  

By the Numbers  

In 2021, producers signed nearly 1.8 million ARC or PLC contracts, and 251 million out of 273 million base acres were enrolled in the programs.  For the 2022 crop year signed contracts surpassed 1.8 million, to be paid in the fall of 2023, if a payment triggers. 

Since ARC and PLC were first authorized by the 2014 Farm Bill and reauthorized by the 2018 Farm Bill, these safety-net programs have paid out more than $34.9 billion to producers of covered commodities.  

Crop Insurance Considerations   

ARC and PLC are part of a broader safety net provided by USDA, which also includes crop insurance and marketing assistance loans.   

Producers are reminded that ARC and PLC elections and enrollments can impact eligibility for some crop insurance products.   

Producers on farms with a PLC election have the option of purchasing Supplemental Coverage Option (SCO) through their Approved Insurance Provider; however, producers on farms where ARC is the election are ineligible for SCO on their planted acres for that crop on that farm.   

Unlike SCO, the Enhanced Coverage Option (ECO) is unaffected by an ARC election.  Producers may add ECO regardless of the farm program election.  

Upland cotton farmers who choose to enroll seed cotton base acres in ARC or PLC are ineligible for the stacked income protection plan (STAX) on their planted cotton acres for that farm.    

More Information    

For more information on ARC and PLC, visit the ARC and PLC webpage or contact your local USDA Service Center.