Resolve to be informed in 2003
With
the rapid escalation in rural America of everything regulatory,
farmers have to be more concerned than ever about their
liabilities, their financial choices, and the contracts
they sign - or don’t sign. The cost of being uninformed
may be higher now than ever before.
This is a brief list of just a few of the choices, deadlines
and new liabilities that lie ahead for Delta producers in
2003.
The new farm program: Secretary of Agriculture Ann Veneman
has recently complained about the slow pace of program signup,
but producers face several complicated decisions.
Although the new program features a return of the old target
price, deficiency payment concept - it does not require
the producer to plant in order to qualify. With some program
benefits payable even if a crop is not planted, and with
commodity prices remaining low, many producers are likely
considering other options for their land - such as wildlife
leases, participation in the Conservation Reserve Program
or other conservation options. These decisions require the
producer to carefully weigh costs and benefits, returns
and obligations. It is very important for producers to go
to their local Farm Service Agency offices early and often
in order to review the full implications of each program
decision.
By April 1st, producers have to choose how their acreage
base and yields will be calculated for the life of the 2002
Farm Bill –or USDA will make the choice for them.
The status of an individual or entity for the purposes of
applying payment limitations for 2003 is also determined
as of April 1st, so any changes in a farming organization
should be made before that date.
The deadline for producers to enroll in the new farm program
for 2002 and 2003 is June 2, 2003. Be cautioned that he
who waits until the end will likely end up waiting in the
longest line, and there will be little opportunity to engage
in any thoughtful discussion concerning program options.
Be ready, as well, for a host of certifications that must
be made, including a new one that the producer has not exceeded
the ceiling on adjusted gross income.
Tax Time: Operations organized as C corporations must be
sure to submit their quarterly estimates by the 15th day
of the 4th, 6th, 9th and 12th month of the tax year. If
they meet certain requirements, self employed farmers may
be eligible to pay estimated taxes in one installment by
January 15 of the year following the tax year. April 15,
of course, is the deadline for filing personal income taxes.
New Liabilities:
The new practice of “licensing” technology contained
in a planting seed instead of selling it to the producer,
and the willingness of the companies who own the technology
to enforce these licenses, has increased the risk associated
with saving seed for planting. Liability issues are also
surfacing with respect to possible “contamination”
of a conventional crop by a neighbor’s biotechnology
crop — issues that have not been adequately addressed
by legislators or the courts. As this brief list of challenges
demonstrates, the uninformed could find an unwelcome set
of new problems this year. It behooves every producer to
“keep informed” on their short list of resolutions
for 2003. DBJ
(William
A. Gillon is an attorney with Butler Snow O’Mara Stevens
& Cannada and has over 15 years experience in agricultural
law and international trade.)
