Farmers find ways around limits on cash subsidies

By MARY CLARE JALONICK
Associated Press

WASHINGTON (AP) -- Lawmakers crafting a sweeping farm bill in 2008 promised it would cut government payments to wealthy farmers. Two years later, little appears to have changed.

Data being made public May 5 shows that the wealthiest farmers in the country are still receiving the bulk of government cash, despite claims from lawmakers that reforms in the bill would put more money in the hands of smaller farms. At the same time, a series of exemptions written into the bill has made it more difficult for the public to find out who is receiving what.

Lawmakers writing the $290 billion bill included several provisions aimed at cutting down on government subsidies to the wealthiest farmers. They sought to eliminate a loophole that allowed farmers to collect higher payments and they set income limits for those who received subsidies. Though those new laws may have cut down on payments to some farmers, others have been able to find ways around them.

Such subsidies to the nation's largest farms are a mainstay of congressional politics. A powerful coalition of farm-state members of Congress have successfully defended their constituents' interests in farm bill after farm bill.

"They are well dug in," said Ken Cook, head of the Environmental Working Group, a Washington advocacy group that has long pushed for more equitable distribution of farm subsidies. "They have a strong interest in defending the status quo."

Cook's organization publishes a database every several years based on a series of Freedom of Information Act requests to the Agriculture Department, which collects data on subsidies but doesn't organize it for the public to search. The group's most recent database, released May 5, shows just 10 percent of farmers received 62 percent of federal farm payments in 2009, roughly the same amount as in 2007 and 2008, before the farm bill was enacted.

One reason for this may be that some farmers have found ways around the new rules. Those who exceed the income limits, established with the aim of eliminating subsidies for millionaires, could speed up purchases of equipment or otherwise alter their accounting to adjust their income. They may also add family members to their farm corporations to qualify for higher payments.

Randolph Rogers, a Hartsville, S.C., farmer who saw his subsidy payments drop after the 2008 Farm Bill eliminated a loophole that allowed him to collect more money, said he recouped some of the money by adding his children and his wife to his farm corporation, called Rogers Bros.

"The rules have changed and we have to change with them," said Rogers, who grows cotton, soybeans, peanuts, corn and wheat.

"We don't have a lot of choice."

According to the Environmental Working Group's database, Rogers Bros. received $807,299 in federal subsidies last year, placing the company 56th on the list of top recipients. But Rogers said those who want to change the way payments are made don't understand the high cost of farming.

"Everybody just acts like we just put our money in our pockets," he said. "But it takes that money to operate."

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On the Net:

Environmental Working Group: http://www.ewg.org/