Direct and Counter-cyclical Payments Program

To provide income support to eligible producers of covered commodities.


Agency - Department of Agriculture

Established in 1862, the Department of Agriculture serves all Americans through anti-hunger efforts, stewardship of nearly 200 million acres of national forest and rangelands, and through product safety and conservation efforts. The USDA opens markets for American farmers and ranchers and provides food for needy people around the world.

Office - Consult the local phone directory for location of the nearest county FSA office.

If no listing, contact the appropriate State FSA office listed in the Farm Service Agency section of Appendix IV of the Catalog or on the WEB at http://www.fsa.usda.gov/edso/.


Program Accomplishments

Not available.

Uses and Use Restrictions

With respect to Fiscal Year 2002 payments, CCC will offer to enter into a contract with eligible producers of covered commodities on October 1, 2002 through the date announced by CCC.

With respect to Fiscal Years 2003 through 2007, CCC shall offer to annually enter into a contract with an eligible producer on a farm having base acreage with respect to a covered commodity at the beginning of each such fiscal year 2003 through 2007 through the date announced by CCC for each such year.



Eligibility Requirements

Applicant Eligibility

To be eligible for payments under DCP, owners, operators, landlords, tenants, or sharecroppers must (1) share in the risk of producing a crop on base acres on a farm enrolled in DCP, and be entitled to share in the crop available for marketing from the base acres, or would have shared had a crop been produced; (2) annually report the use of the farm's cropland acreage; (3) comply with conservation and wetland protection requirements on all of their land; (4) comply with planting flexibility requirements; (5) use the base acres for agricultural or related activities; and (5) protect all base acres from erosion, including providing sufficient cover as determined necessary by the county FSA committee, and control weeds.

Beneficiary Eligibility

DCP provides payments to eligible producers on farms enrolled for the 2002 through 2007 crop years.

Credentials/Documentation

As a condition of eligibility for direct and counter-cyclical payments, the operator or owner must submit a report of all cropland acreage on the farm. Reports of production evidence for all covered commodities shall be provided to the county committee of the county where the farm is administratively located, by farm and crop in such manner as required by CCC on a CCC-approved standard, uniform form designated by CCC. When disposition of production has been through commercial channels, CCC may require the producer to furnish documentary evidence in order to verify the information provided on the report of production.

Aplication and Award Process

Preapplication Coordination

None.

This program is excluded from coverage under OMB Circular No.

A-102 and E.O.

12372.

Application Procedures

The CCC-509 must be submitted. The following documents are required and applicable determinations must be made before the county committee can approve a producer's share on the CCC-509 for payment: (1) a farm operating plan (CCC-502 and related forms); (2) an average adjusted gross income certification (CCC-526); (3) a certification of compliance with highly erodible land and wetland conservation provisions (AD-1026). A certification of the acreage of all cropland on the farm (FSA-578) is needed before final payments can be issued.

Award Procedures

Producers may elect to receive their direct payments in two installments per year: (1) the first payment, available in December of the fiscal year, is up to 50 percent of the total payment; (2) the balance of the total direct payment is available in October of the fiscal year after the fiscal year the payment is earned. Producers who do not elect to take the first direct payment will receive the entire direct payment at this time. Producers may elect to receive up to three counter-cyclical payments per year: (1) first partial payments are available in October of the calendar year in which the crop is harvested. These payments cannot exceed 35 percent of the total projected payment; (2) second partial payments, up to 70 percent of the projected payment, minus the amount of the first partial payment, are available the following February (the year after the crop is harvested); (3) final payments are made after the end of the marketing year for the crop. Producers who do not elect to take the first and second advance payments will receive the entire counter-cyclical payment at this time.

Deadlines

Please contact the program contact listed in the Information Contacts section below.

Authorization

The Farm Security and Rural Investment Act of 2002 (2002 Farm Bill).

Range of Approval/Disapproval Time

Approval of payments depends on farmer compliance with conservation and wetland protection requirements on all of the producers' farms, planting flexibility requirements and other eligibility requirements mentioned above, and is fairly routine and prompt.

Appeals

A producer may obtain reconsideration and review of any adverse determination made under this part in accordance with the appeal regulations found at parts 11 and 780 of Title 7 Agriculture.

Renewals

Farm producers must apply for DCP on an annual basis and can opt out of participating in DCP for any year if they so choose.

Assistance Considerations

Formula and Matching Requirements

For each covered commodity, the direct payment for each crop year equals 85 percent of the farm's base acreage times the farm's direct payment yield times the direct payment rate. For each covered commodity, the counter-cyclical payment for each crop year equals 85 percent of the farm's base acreage times the farm's counter-cyclical payment yield times the counter-cyclical payment rate.

Length and Time Phasing of Assistance

The DCP payment schedule for 2002 and 2003 crop years is in the hyperlink provided below. The payment schedule for the 2004-2007 crop years parallels the schedule for the 2003 crop year. http://www.fsa.usda.gov/pas/publications/facts/html/dcp03.htm.

Post Assistance Requirements

Reports

A certification of the acreage of all cropland on the farm (FSA-578) is needed before final payments can be issued.

Audits

Recipients under this program are subject to audit by the Office of the Regional Inspector General, USDA.

Records

An owner or any other individual or entity receiving assistance for DCP shall maintain and retain financial books and records which will permit verification of all transactions for at least 3 years, following the end of the calendar year in which assistance was provided.

Financial Information

Account Identification

12-4336-0-3-351.

Obigations

Direct Payments: FY 07 $4,357,871,511.55; FY 08 est not available; and FY 09 est not reported. Counter-Cyclical Payments: FY 07 $3,765,561,623; FY 08 est not available; and FY 09 est not reported.

Range and Average of Financial Assistance

Not applicable.

Regulations, Guidelines, and Literature

Program is announced through news media and in letters to agricultural producers in the counties. Regulations published in the Federal Register, 7 CFR Part 1412.

Information Contacts

Regional or Local Office

Consult the local phone directory for location of the nearest county FSA office. If no listing, contact the appropriate State FSA office listed in the Farm Service Agency section of Appendix IV of the Catalog or on the WEB at http://www.fsa.usda.gov/edso/.

Headquarters Office

U.S. Department of Agriculture, Farm Service Agency, Production Emergencies and Compliance Division, Compliance Branch, 1400 Independence Ave. SW., Washington DC 20250-0514. Telephone: (202) 720-9882.

Criteria for Selecting Proposals

All producers meeting eligibility requirements may receive assistance. Applications are non-competitive.



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