By NANCY VORIS
Indiana Correspondent

INDIANAPOLIS, Ind. — What defines “actively engaged in farming?” The definition is a key in many government programs and is a stumbling block for many producers applying for those programs.
The public has until April 6 to submit comments on the regulation defining actively engaged participation in a farming operation.
The regulation, published Dec. 29, 2008, invites comments on the interim rule for implementation of key eligibility requirements for many Farm Service Agency (FSA) and Natural Resources Conservation Service (NRCS) services.

“In the past, we had the three-entity rule,” said Carl Schweikhardt of FSA. “Now with the new farm bill, we’ve gone to direct attribution. We’re looking at the person, not the corporation, and payments are traced down to that person’s Social Security number.”

The regulations were revised as mandated by the Food, Conservation and Energy Act of 2008 (2008 Farm Bill) to make changes in payment eligibility, payment attribution, maximum income limits and maximum dollar benefit amounts for participants in CCC-funded programs. In addition, certain provisions were incorporated that are discretionary.

The actively engaged provision requires that individuals and entities must be “actively engaged in farming” with respect to a farming operation in order to be eligible for specified payment and benefits. To be “actively engaged in farming,” the individual or entity must make significant contributions to the farming operation of (1) capital, equipment, land or a combination; and (2) personal labor or active personal management, or a combination.

Current rules, in effect since 1988, state that not every member of an entity is required to contribute active personal labor or management. The interim rule requires each partner, stockholder or member with an ownership interest to make a contribution of active personal labor or active personal management.

The contribution must be regular and substantial, and documented as separate and distinct from any other member’s contribution. The rule limits the ability of passive stockholders to continue to realize benefits from the entity.

The rule changes make the requirement for adding new persons to a farming operation more restrictive. The addition of a person to an existing farming operation can be met through an increase of 20 percent of base acres to the operation; previously the requirement was an increase of 20 percent in cropland.

“Depending on how an operation is set up, in some cases the new rule is better and in some cases producers are limited,” Schweikhardt said.

Comments may be submitted by any of the following methods:
•E-mail: Salomon.Ramirez@wdc.usda.gov
•Fax: 202-690–2130
•Mail: Salomon Ramirez, Director, Production, Emergencies and Compliance Division, FSA, U.S.
Department of Agriculture (USDA), Stop 0517, Room 4752, 1400 Independence Ave., SW., Washington, DC 20250–0517.
•Hand Delivery or Courier: Deliver comments to the above address.
•Federal eRulemaking Portal: Go to www.regulations.gov and follow the online instructions for submitting comments. Comments may be inspected at the mail address listed above between 8 a.m. and 4:30 p.m., Monday through Friday, except holidays. A copy of this interim rule is available through the FSA home page at www.fsa.usda.gov