The writing of regulations for a radically different peanut program may have looked like putting meat on a skeleton to some this year. The new farm bill provided the skeleton for the program; USDA wrote the regulations that put meat on the bones. But the real workout this fall continues at the county Farm Service Agency's County Office level, where personnel are carrying out the regulations. The new peanut law requires farmers to make decisions beyond the buying point once harvest is completed.
The meat on the plate at the county offices consists of implementing the peanut quota buyout, the new marketing loan program for peanuts loan rates, and updating bases and yields, in addition to “regular” work on other crops.
Jimmy Dunn, district director of the Virginia FSA, has seen it from both sides of the fence this fall. Over a two-month period at the USDA in Washington, D.C., he helped write the regulations on marketing and policy on the peanut marketing program. Now he's helping to implement those regulations at the county level. Calvin Parrish is the acting state director of the Virginia Farm Service Agency.
“Overall, I think we've done a very good job with what we had to work with in such a short timeframe,” Dunn says.
Following a lengthy debate in the House and Senate, the president signed a farm bill on May 13, 2002. In effect, the bill came a year before the previous legislation was set to expire. “The farm bill came a year early and six months late,” says Bob Sutter, CEO of the North Carolina Peanut Growers Association, referring to its passage and the writing of the regulations at the Commissioner's Ag Forum held recently in Kinston, N.C.
The peanut program has undergone a complete change: Quota has been abolished; words like base, counter cyclical payments and Loan Deficiency Payments (LDPs) are now part of the peanut vernacular. The legislation included a buyout of peanut quota.
Due to the major changes in the law, Congress tasked the USDA with the job of writing regulations that would take effect for the 2002 season — rather than the 2003 season. “With all the changes that came about and all the decisions that had to be made, we tried to develop a program that would cause the least amount of turmoil this year — although we realize some problems will occur,” Dunn says.
In 10 to 14 hour days at the USDA, Dunn and others dealt with questions about how to set loan rates for four different types of peanuts, whether to use 1007 forms for grading purposes, whether to use marketing cards, and many other issues relating to the marketing of peanuts for the 2002 crop.
The two-month detail to the USDA opened Dunn's eyes to the process of what goes into the writing of regulations. “I was told that it was a tremendous amount of work, but until you actually go through the process, you don't have an idea,” he says.
“So many people have to write the policy,” Dunn says. “I was amazed at the amount of meetings. A lot of people have to be kept involved in the process, from the administrators, undersecretary's office, office of the general counsel, office of civil rights, chief information officer, office of the general counsel and the Agricultural Marketing Service.
“If you do something and someone is left out of the loop, you have to go back and insure everyone is in agreement,” Dunn says. “One word can change the meaning of the statement, and different groups have to review that one word.”
Upon returning to his full-time position as district director, Dunn spends his time in the various busy county offices in southeast Virginia.
The scene is much the same at each stop. “The county offices are as busy as I can remember in my 19-year career with FSA,” Dunn says.
“The quota buyout program has really brought out people who we usually don't see,” he says.
In addition to their normal workload, the local FSA workload involves updating farmers' peanut bases, as well as signing up farmers and landowners for the peanut quota buyout. This fall, the district hired four temporary workers to help with the extra peanut load. The local FSA staffs are handling from 15 to 20 people a day on the quota buyout. Depending on what needs to be done in each instance, it can take from 10 minutes to two hours to get everything correct and verify information, Dunn says.
“The staffs are performing admirably,” Dunn says. “I've heard very few complaints.”
The new law requires farmers to make the decisions regarding the marketing of peanuts. “Farmers need to be aware of the changes to the program and realize that peanuts are being handled in a similar method to other commodity crops they grow.”
He's encouraging farmers to look at the LDP and counter cyclical payments as part of the overall income picture. “There are a lot of different views on it, but we need to be positive about peanuts,” Dunn says. “All of the new provisions need to be considered in making the decisions about whether or not to plant peanuts in the future. I think there is a place for peanuts in Virginia and North Carolina.”
This fall he's been asking farmers to be patient with the process. “We're going to get the quota buyout payments to producers and landowners and payments to producers as smoothly as possible.”
Dunn realizes it's a work in progress. A number of issues in the regulations will likely be revisited for next year.
Among those: The FSA Form 1007, one of the FSA's methods for collecting price and grade data. “That form will probably have to be revisited,” Dunn says. “Do we want to continue to collect data in this manner or go to an electronic warehouse receipt similar to cotton?”
In regard to the national weekly price of peanuts, Dunn says fine-tuning of the price discovery mechanism may be in order. “I think USDA Undersecretary J.B. Penn wants to put all the resources into getting the best data available to determine the price.
“The peanut industry may need to determine if there's going to be any place where peanuts are traded publicly like the Chicago Board of Trade,” Dunn says.
“Anytime you transition from a program that has been in place as long as the previous peanut program had, you're going to have an opportunity to fine-tune,” Dunn says. “There's always room for improvement. We feel like we got the best program in place in the timeframe given that we could with the new farm bill provisions.”