U.S. Sen. Charles Grassley has worked hard to close the loopholes that allow people not entitled to benefit from the farm payment system to do so in violation of congressional intent. Three separate Government Accountability Office reports requested by the Iowa Republican have documented improper farm payments. A GAO report released in October 2008 concluded that the U.S. Department of Agriculture made nearly $50 million worth of potentially improper payments to farmers who exceeded income eligibility limits put in place by Congress. Another report determined that some government farm payments have gone to dead people.
Now Sec. of Agriculture Tom Vilsack has announced that his department and the U.S. Internal Revenue Service are working closely to put an end to the fraud identified by the GAO reports Grassley brought about.
"One of the goals of this administration is to make certain that USDA payments are not issued to individuals and entities that exceed income eligibility limits established by law," Vilsack said in a statement released March 19. "Once this verification system is fully operational, high-income individuals and entities will be identified by USDA before farm program payments are actually disbursed to them."
Beginning with the 2009 crop year and for successive years in order to be eligible for USDA payments all recipients will be required to sign a form that grants IRS the authority to provide income information to USDA for verification purposes. That should improve the ability of the USDA to ensure that payments don't go to individuals and entities specifically excluded from eligibility by Farm Bill provisions.
In part due to Grassley's tireless anti-fraud efforts, the 2008 Farm Bill mandates that recipients of many Farm Bill payments, including direct payments, may not receive these payments if their gross nonfarm income average for the previous three taxable years is greater than $500,000. Additionally, direct payments cannot be paid to participants whose average adjusted gross farm income for the three-year period exceeds $750,000. Eligibility for conservation payments requires that participants have a nonfarm average gross income for the three-year period that does not exceeds $1 million, unless at least two-thirds of their total average adjusted gross income is derived from farming.
Grassley said upon learning of the joint effort by the USDA and IRS that he welcomed this much-needed initiative.
"Not only were dead people receiving farm payments, but people far exceeding the income limitations were taking advantage of a system meant to help small- and medium-sized farmers get through the rough patches of farming," the senator said. "It appears that this agreement between USDA and IRS will help eliminate some of the fraud and abuse we've been seeing. ... This is a good step forward in bringing more accountability to the farm payment system and instilling confidence with the public that payments are going to those who need it most."