Large farms find legal loopholes to get more trade aid

Eight members of Bernard Peterson's family in Loretto, Ky.,
received a total of $863,560, under the limit of $125,000 per
individual. He told The Associated Press that it still didn't make
up for their losses at a time of low prices. (AP photo by Dylan Lovan)

President Trump's aid package for farmers who suffered losses because of his trade war included limits on payments to individuals, but many large farms have found legal loopholes to get around those limits, The Associated Press reports. It says records it obtained under the Freedom of Information Act show more than 3,000 trade-aid recipients collected more than the $125,000 limit.

"Recipients who spoke to AP defended the payouts, saying they didn’t cover their losses from the trade war, and they were legally entitled to them. U.S. Department of Agriculture rules let farms file claims for multiple family members or other partners who meet the department’s definition of being 'actively engaged in farming'," Steve Karnowski and Balint Szalai report. For example, a soybean farm in southeast Missouri received nearly $2.8 million because it was registered as three entities at the same address.

About 83 percent of trade-aid money has gone to soybean growers, who have been affected most by the tariff war with China. The program sets caps in three categories: soybeans and other row crops, pork and dairy, and cherries and almonds. Farmers with products in two or three categories can collect up to $125,000 in each category. The USDA has paid out about $8.6 billion, but the new rule will bring payouts closer to the $12 billion authorized, Karnowski and Szalai report.

USDA officials said they believe they are following the rules and can audit suspicious cases. "But critics including U.S. Sen. Charles Grassley, an Iowa Republican who has long fought for subsidy limits, say it’s 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," AP reports.

Grassley told the news service that huge farms are getting the payments "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." He called for USDA to change rules and increase oversight.