·  Legal News, Analysis, & Commentary


Investigation Suggests Farmers are Taking Advantage of Funds

— September 5, 2019

Trump’s program to provide relief to farmers could enable recipients to receive payouts far above subsidy limits.

President Donald Trump’s administration recently announced a $12 billion aid package, with capped payouts, for farmers who’ve been impacted by his trade dispute with China.  Many large farming operations took full advantage with critics suggesting clever legal maneuvers were made to try to get around the limit of $125,000.

Approximately 83 percent of the aid under the Market Facilitation Program has gone to soybean farmers with caps set in each of three categories of commodities impacted – one for soybeans and other row crops, one for pork and dairy, and one for cherries and almonds.  Under the program, each qualified family member or business gets their own $125,000 cap for each category.  Farmers who produce commodities in two separate categories, for example, would have separate caps for each and could collect $250,000, and there are ways to take advantage of this and collect even more.

Investigation Suggests Farmers are Taking Advantage of Funds
Photo by Noah Buscher on Unsplash

According to records obtained via the Freedom of Information Act, the package paid out nearly $2.8 million to a Missouri soybean harvester registered as three entities at the same address, for example.  An investigation also found that $900,000 went a handful of other farm businesses, in Illinois, Indiana, Tennessee and a Texas, and three other operations collected $800,000.  Sixteen more collected over $700,000.

In Michigan, 38 farms located in 32 communities received more than the maximum with those in Holland, Bronson, and Wheeler receiving greater than $375,000.  In fact, the average overpayment in Michigan was $94,512, and among the 500 counties throughout the United States that received the largest amounts of subsidies, seven Michigan counties were among them.

U.S. Senator Charles Grassley, an Iowa Republican, is a critic of the program and said that the ability for farmers to get around the limits and take advantage of these programs is just the “latest example of how loopholes in federal farm subsidy programs allow large farms to collect far more than the supposed caps on that aid.”  He said, that many large farms are receiving subsidies well-over what’s specified “through underhanded legal tricks.  They’re getting richer off the backs of taxpayers while young and beginning farmers are priced out of the profession.  This needs to end.  The Department of Agriculture needs to re-evaluate its rules for awarding federal funds and conduct more thorough oversight of where it’s funneling taxpayer dollars.”

At Peterson Farms in Loretto, Kentucky, eight members of the family partnership collected a total $863,560.  Co-owner Bernard Peterson said that it “didn’t make up for all their losses at a time when it was already hard to be profitable.”  He added, “It’s a big number but there are a big number of people directly depending on the success of our operation in the community.”  The farming operation supports 30 families year-round.  “It’s a lot more than just the owners of the company,” he said.

Matt Keller, a pork producer in Kenyon, Minnesota, who also grows crops to feed his livestock, said he “definitely appreciated” the $143,820 he collected from the program.  He, too, said “It didn’t cover all of the losses, but it helped with his cash flow.”  The $125,000 cap was allocated to his hogs, and the remaining funds were for his corn and soybeans crops.

Keller said his wife and other family members are all involved in his operation and the money was much needed, adding, “It was kind of a relief, I guess, that we had a little support from the president and the country.”


Trump farm subsidies: Farmers find ways to boost their payments

Many Michigan farmers found loopholes to squeeze more cash from Trump aid program

Join the conversation!