Subsidies Must Return To Sender

Farmers and landlords in Washington and Idaho must pay back $82 million in government subsidies advanced earlier in the year because they’ve made too much money in the open market.

U.S. Department of Agriculture officials in Spokane and Boise said Friday that they have begun issuing letters seeking refunds from more than 16,300 producers who were advanced the money last spring to help pay for seed, fertilizer and bank loans.

This marks the first time that a refund on wheat subsidies has been sought, officials said. Refunds have been made in the past on other program crops - barley, oats and corn.

“The letters are going out; the feedback we’ve had is mostly negative,” said Dick Rush, state executive of the USDA’s Farm Service Agency in Boise.

Farmers receive subsidies in exchange for agreeing to conform to government regulations such as idling certain land and using conservation farming techniques.

Known as deficiency payments, the subsidies close the gap between a government target price, set at $4.00 this year, and the market price. But export demand and world crop shortages drove prices above $5.00, their highest sustained level in 20 years. That made taxpayer assistance unnecessary.

“It’s hard for me to justify that it’s our money,” said Brian Crow, an Oakesdale, Wash., wheat grower. “It’s taxpayers’ money used to support our industry when prices are poor. We’ve haven’t earned the right to keep it.”

But Reardan farmer Gary Wegner looks at it differently. He said the government should let farmers keep the advance as part of the proposed changes in federal farm programs. The money would help wean farmers from subsidies.

“I think it’s only fair and equitable that we don’t have to pay it back so we can survive the transition,” Wegner said. “I don’t want to pay back a significant amount of money that I think I should keep.”

Nearly 2,500 people who farm or own land in Whitman County must pay back $8.8 million, the largest refund of any county in Washington, Farm Service said.

Farmers still have eight months before they have to refund the money without penalty, though some will pay it now to reduce their taxable income, said Farm Service program specialist Rod Hamilton in Spokane. Participants also have the option of deducting the refund from future deficiency payments.

, DataTimes