WASHINGTON, March 21, 2012 – Senators Chuck Grassley, R-Iowa, and Tim Johnson, D-S.D., introduced legislation today that would place a hard cap on the farm payments an individual farmer could receive in a year and would close loopholes in the farm payment program.

The new Grassley-Johnson payment limits bill sets a hard cap for farm payments of $250,000 per married couple, and closes loopholes that allow non-farmers to qualify for federal farm payments.

The senators introduced similar legislation earlier this Congress, but wanted to be sure the legislative text would accommodate any type of safety-net program adopted in a new farm and nutrition bill, especially in light of the growing prospect that direct payments are unlikely to be included in a farm bill. 

“A strong safety net is critical to ensuring a safe and affordable food supply.  In order to maintain that safety net, we can’t have the mentality of the past where the government looked the other way and allowed people with no connection to the farm to take farm payments,” Grassley said.  “It’s unacceptable that small- and medium-sized farmers get so little of the very program that was created to help them.”

Specifically, the new Grassley-Johnson payment limits bill has a hard cap on marketing loan gains of $75,000 ($150,000 for a couple).   The remainder of the payment limit would be a cap on the total amount a farmer can receive in safety-net payments in general.  For instance, if the Congress were to adopt a shallow loss program, the Grassley-Johnson bill would set a limit of $50,000 ($100,000 for a couple) that a farmer could receive.

In addition, the bill closes loopholes that allow people with ties to the farmland that consist of “a conference call and nothing else.”  The bill sets a measurable standard for someone to qualify as actively engaged in farming by providing management for the operation. The bill provides an exception for farming operations where there is only one manager of the farm. 

Senators Michael Enzi, R-Wyo., Sherrod Brown, D-Ohio, Kirsten Gillibrand, D-N.Y., and Ben Nelson, D-Neb., also joined the bill. 


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