The rule specifies the CAP eligibility requirements, payment calculations and application procedures. The total available funds are $550 million and the Deputy Administrator may pro-rate payments, to the extent the Deputy Administrator determines that necessary.

The assistance is being made available under Section 32 which provides authority for the Agriculture Secretary to use funds to “reestablish farmers’ purchasing power by making payments in connection with the normal production of any agricultural commodity for domestic consumption.”

USDA’s Farm Service Agency (FSA) already has identified the relevant disaster counties, has producer acreage and ownership shares on file, and has determined the payment rate for each crop. For CAP, FSA identified 953 counties in 34 States that received Secretarial disaster designations due to excessive moisture and related conditions in ’09. Cotton Belt states are: Alabama, Arkansas, Florida, Georgia, Kansas, Louisiana, Mississippi, Missouri, New Mexico, North Carolina, Oklahoma, Tennessee and Texas.

Producers must meet all of the following requirements to be eligible for a CAP payment: 1) have on file an existing ’09 crop year form FSA-578, “Report of Acreage,” as planted or considered planted, and that acreage report must have been on file with FSA prior to the publication of this interim rule; 2) the ’09 form FSA-578, Report of Acreage, must specify the producer’s ownership share of a ’09 crop of upland cotton, long grain rice, medium or short grain rice, soybeans, or sweet potatoes, and the amount of acres of those crops planted or considered planted; 3) the eligible crop acreage must be located in a primary county for which a Secretarial disaster designation was issued based on excessive moisture and related conditions for the ’09 crop year; 4) there must have been a 5% or greater loss in crop quality or quantity of the ’09 crop of upland cotton, long grain rice, medium or short grain rice, soybeans, or sweet potatoes, for which the producer applies for a CAP payment; the loss must be due to a disaster, as defined in the rule, and the 5% loss is a minimum threshold for CAP eligibility; greater losses do not qualify producers for a larger payment; and 5) application for a CAP payment must be made no later than 45 days after publication in the Federal Register.

The 5% loss threshold must be met for each crop for which the producer requests a CAP payment. The individual producer’s share of the crop on the farm must have suffered the loss, independent of what other producers of the crop on that farm may have produced or their loss. The producer will need to calculate quantity losses based on historical or expected production of the crop. The producer will need to certify that the loss was at least 5% and will need to maintain verifiable and reliable documentation to justify the certification. The determination by a producer that a crop suffered a 5% or greater loss is based on the producer’s self-certification. Producers must be able to document, if requested by FSA, how they determined that the 5% loss threshold was met. For quantity losses, the calculation must use historic yield and expected production as defined in this rule.

FSA will provide county average yield data on request. Expected production means -- the historic yield multiplied by the producer’s share of planted and considered planted acres of the crop for the farm. Expected production may be used to assist producers in determining whether the producer has a crop or crops that suffered a qualifying loss of 5% and to determine whether that crop is eligible for CAP benefits. Historic yield means the higher of the county average yield or the producer’s approved yields for eligible crops on the farm. An insured producer's yield will be the higher of the county average yield listed or the approved federal crop insurance APH, for the disaster year. A NAP producer's yield will be the higher of the county average yield or NAP approved yield for the disaster year. Replacement crops are not eligible for CAP.

At the time of application a producer will not be required to submit documentation of production, expected production, quality or loss. The amount of acreage for each crop that will be used to determine the amount of the CAP payment (payment acres) and the producer’s ownership share of the crop will be the amount previously reported to FSA by the producer for the ’09 crop year form FSA-578, Report of Acreage, that is on file in FSA as of the date this regulation is published. CAP payments will be calculated by multiplying the total number of acres of the crop planted or considered planted on the farm by that crop’s per-acre payment rate.

FSA determined the rates based on average per-acre revenue losses on the ’09 crop due to moisture-related disasters. The per acre payment rates are as follows:  long grain rice, $31.93; medium or short grain, $52.46; upland cotton, $17.70; soybeans, $15.62; and sweet potatoes, $155.41.

The CAP payment will be based on the producer’s share of the reported or determined planted or considered planted acres of the crop times the per acre payment rate for the crop. If there is more than one eligible producer on a farm that shared in the crop, each producer may apply for a payment based on their share in the crop.

CAP payments will be treated as ’09 revenue under the Supplemental Revenue Assistance Payments Program. The payment limits and adjusted gross income (AGI) limits that apply to other Commodity Credit Corp. and FSA programs apply to CAP. Specifically, no person or legal entity (excluding a joint venture or general partnership) may receive, directly or indirectly, more than $100,000 in CAP benefits.

In applying the limitation on AGI for ’09, a person or legal entity with an average adjusted gross non-farm income that exceeds $500,000 for the three taxable years preceding ’08 (’05-07) will not be eligible to receive CAP payments. If there is more than one producer on a farm, only the producers on a farm who sign the application will be eligible to receive payment. Producers may receive payment from shares of eligible crops on multiple farms if they sign an application for each farm, subject to the $100,000 payment limit that is per person or legal entity, not per farm or per crop.

The Leonardo Academy and its principal financial sponsor, Scientific Certification Systems, had undertaken an effort in ’07 to develop a draft national standard for sustainable agriculture under a consensus-based process governed by the American National Standards Institute. “Sustainable” agriculture is being promoted as a marketing tool by some major retailers (see www.walmartstores.com for their recently published sustainability goals).

A letter addressed to Michael Arny, Leonardo Academy president, was signed by 10 national agricultural organization voting members, including Dr. Bill Norman, the NCC’s vice president, Technical Services, on the nearly 60-member Committee. The letter also was endorsed by 46 other agricultural organizations nationwide.

The resignation letter stated, “A successful American National Standards Institute (ANSI) sustainable agriculture standard cannot be developed without the fair representation and participation of those representing the overwhelming majority of U.S. agriculture which constitutes 95 percent of production. Unfortunately, mainstream agriculture has been given a decidedly minor voice in Leonardo Academy’s process.”

Despite these Committee limitations, representatives of major agricultural commodities worked within the Leonardo Academy process for nearly two years to achieve broad consensus on achievable environmental, economic and social components of sustainability. Recent actions taken by others on the Committee undercut some key language that was agreed upon in subcommittee negotiations and precipitated the walk-out of mainstream agriculture.

The agricultural organizations stressed in their resignation letter that they remain supportive of the goal of sustainable agriculture and intend to pursue a “valid approach” in another venue.