For Farm Service Agency (FSA) program purposes, multiple land tracts managed by the same owner and operator are recorded under one farm serial number. When changes in the particular ownership or operation of these farms occur, a farm change or reconstitution becomes necessary.
The reconstitution is the process of combining or dividing farms based upon the various factors that influence that farm?s operation. In order to be effective for the 2010 program year, farm reconstitution requests must be filed by no later than August 2. Otherwise, they will only be recognized as a valid change for the following year.
In respect to farm divisions, producers may choose among the following methods, listed in priority order, that are utilized to proportion their cropland and crop acreage base totals on a farm.
Estate Method: acreage bases are divided for a parent farm among the heirs of a settled estate.
Designation by Landowner Method: used in instances when 1) a part of a farm is sold; 2) an entire farm or tract is sold to two or more persons; 3) a part of a tract is sold or ownership is transferred. In order to use this method, the land sold must have been owned for at least three years and the buyer and seller must execute and sign a Memorandum of Understanding that outlines the specific terms of the land transfer.
DCP Cropland Method: acreage bases are divided in the same proportion that DCP cropland for each resulting tract relates to the DCP cropland on the parent farm.
Default Method: acreage base division is done for a parent farm with each tract maintaining the base level attributed to the tract level when the reconstitution was initiated.
Many FSA programs allow continued benefit payments to be issued to heirs or successors when an original program participant becomes deceased. Thus, in the event of an FSA program participant?s death, it is important that we be timely notified. Those entities, such as corporations, partnerships and trusts that are a part of programs also need to inform FSA when a shareholder or member is no longer a part of the entity. FSA payments are reported to the IRS and preserving current and accurate records is vital to ensuring those payments are not misrepresented.
Also, program integrity compliance and control measures are being employed during the 2010 crop year. A Nationally designated selection is used to achieve a statistical sampling of those producers participating in USDA-FSA programs. Quality control spot checks and reviews are conducted on the selected producers based on their enrollment in programs such as the Conservation Reserve Program, Direct & Counter-cyclical Program, Market Assistance Loan and the Livestock Indemnity Program.