Monday, July 16, 2012

Price Loss Coverage II

Still too lazy to read the text of the bill, but I got to thinking on my way to the garden.  When I moved to the production adjustment side of ASCS, we had programs which limited the planted acreage to some figure.  I'm not sure when that changed and how drastically it did.

Assume with me that since 1997 FSA hasn't been enforcing any acreage limitations--that may be true, may not be.  Back in the day we had "measurement variance", which recognized the ways we determined acreages were not 100 percent accurate.  If you ran the planimeter on your aerial photography, you might be off a tad.  And we also had a "tolerance" figure, which recognized the farmer might be trying to limit her planted acreage to the exact figure, but wouldn't have the tools to be exact.  Roughly speaking, if the farmer were supposed to plant only 100 acres of corn and he planted 103 acres, he was probably "within tolerance" and in full compliance with the program.

Finally we had "failure to fully comply". If you the farmer planted more than you were supposed to by more than the tolerance (say 106 acres), then the county committee had to determine whether you were acting in "good faith".  If you were, the payment would be reduced.  If you weren't, you were ineligible.

I recite these provisions first because they fascinated me as I tried to figure them out. My co-workers had all come from county offices so they had absorbed the provisions; I had to figure out their logic and how they related.

The provisions are interesting because, if there is no limit, as there hasn't been for a while (think I'm safe in saying that), they all go away.  But if the Price Loss Coverage program, which seems to reinstate a limit, the situation may change.

Damn, I really need to read the bill's language.
[Updated: this may be interesting as history, but probably inapplicable to the proposed program.  More to follow]

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