Brown Announces Crop Insurance Reform
Ohio farmers who participate in federal crop insurance programs and have a history of good performance could be eligible for up to $25,000 in rebates due to crop insurance reforms, said U.S. Sen. Sherrod Brown (D-OH)on Thursday. This proposed refund is made possible by the savings realized from recent negotiations between the U.S. Department of Agriculture (USDA) and the private insurance industry.
Brown was an advocate for crop insurance reform during the 2008 Farm Bill debate and led a bipartisan effort to cut more than $2 billion in subsidies to crop insurance companies and redirect the funds to critical agriculture and rural development initiatives and to pay down the federal deficit. While the amendment was ultimately unsuccessful, it laid the groundwork for a USDA-led negotiation with 16 crop insurance companies which generated $6 billion in savings over the next 10 years. USDA has proposed using $4 billion of savings for deficit reduction and $2 billion of savings to support farmers and farm conservation through programs such as this rebate.
"Reforms to federal crop insurance programs will benefit Ohio farmers and help reduce our federal deficit. Instead of overpaying insurance companies, Ohio farmers could now see federal rebates through crop insurance reform," Brown said. "This program will refund a portion of farmers' premiums and reward farmers for best management practices." Under the proposed program, payment amounts would vary by producer and would be based on each qualified producer's history in the program. USDA's Risk Management Agency (RMA) estimates that the average refund amount per producer this year will be about $1,000 although Ohio farmers could see more. The program has a proposed maximum limit of $25,000, with a minimum payment of $25. The first year of the proposed program will use data from 2009 and prior crop years because not all 2010 data is finalized.
RMA stated it expects that this proposed Good Performance Refund program will provide producers in rural America with about $75 million this year in crop insurance refunds. It is estimated that the proposed program would benefit farmers and ranchers in over two-thirds of counties nationwide. USDA's Risk Management Agency proposed rule will be collecting public comments on the rule for a 15-day period that ends Jan. 21, 2011 and subsequently finalizing the rule. The proposed program is intended to be available to farmers prior to the spring planting season.
Information provided by Ohio Farmers Union - www.ohfarmersunion.org