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Blake Nicholson, Associated Press, Published September 06 2012

Upper Midwest farmers want changes in crop insurance rules

BISMARCK — Some upper Midwest farmers who thought they caught a break when the federal government eased crop insurance rules for land hit by prolonged flooding are finding it isn't as easy to cash in as they first thought.

Members of North Dakota's congressional delegation are urging the head of the federal Risk Management Agency to look into the matter. The RMA oversees federal crop insurance programs.

“To change the rules or to arbitrarily reinterpret a rule undermines the entire intent of last year's program change, which is to help producers through a multiple-year disaster event,” said Sen. John Hoeven, R-N.D.

Farmers can buy crop insurance through the federally backed program to protect themselves against crop losses caused by bad weather or, in some cases, revenue losses caused by market swings. Farmers who can't plant their crops due to flooding or other adverse weather conditions can collect “prevented planting” payments through their insurance to help them mitigate the loss from not being able to grow and sell a crop.

In the past, farmers in the region could not file a prevented planting claim if their land had been inundated more than a year, because the land typically is not suitable for crops. But with a lot of potentially productive land being inundated during a recent string of wet springs, politicians and farm groups in North Dakota last year lobbied the RMA for change.

The agency implemented a new rule that took effect this year under which farmers in five states — North Dakota, South Dakota, Iowa, Minnesota and Montana — can qualify for prevented planting payments on flooded land if they have planted a crop there at least once in the past four years.

Tom Brusegaard, a field representative for Hoeven, said some farmers have complained about being denied prevented planting payments on land that was too wet to plant last spring even though they had seeded it in the past four years.

“RMA is saying in addition to meeting that requirement there are other specific things they need,” Brusegaard said. “Particularly, they're pointing to a specific loss event ... they are looking for a specific rain event. To say your ground is too wet (to plant) is not enough.”

Kathleen Gilbertson, a senior risk management specialist at the RMA regional office in Billings, Mont., said it always has been the responsibility of the farmer to prove a loss. She said some farmers apparently were unaware that the “one-in-four” provision was just one part of the eligibility requirements.

“Everybody forgets there are other criteria,” Gilbertson said.

For example, some farmers in spring 2008 were able to seed land that normally is too wet for crop production because it was an abnormally dry year. That doesn't count under the one-in-four rule because prevented planting payments aren't meant to go toward land that typically can't support crops.

The RMA published memorandums this summer clarifying some of the rules.

“(Farmers) are finding out there's more to it than the one-in-four; it's becoming more widely known what the rules are,” Gilbertson said.

Northwest North Dakota farmer Keith Deutsch, president of the U.S. Durum Growers Association, said he is still puzzled about being denied prevented planting payments for about 50 acres of land he was unable to seed last spring because they were wet.

“I don't quite understand why,” he said. “I didn't dig into it too much. I thought, if that's the way they're going to do it ... it wasn't too many acres, anyway.”

But Brusegaard said about 30 farmers have sought help from Hoeven's office. Rep. Rick Berg, R-N.D., also has asked RMA Administrator William Murphy to address the issue.

Brusegaard said he doesn't think the issue is much of a problem outside of North Dakota, where overly wet springs have been commonplace in recent years and farmers in the closed Devils Lake basin have dealt with flooding for two decades. Laurie Langstraat, a spokeswoman for the National Crop Insurance Services trade group, also said North Dakota appears to be the area of most concern when it comes to land affected by prolonged flooding.

“There are regions in the other states that can experience similar issues from time to time, but probably not to the extent of North Dakota,” she said.

Gilbertson did not have an estimate on the number of farmers having problems meeting the prevented planting provisions, though she implied it doesn't appear to be a widespread issue.

“The ones that are having problems are very vocal about it,” she said.

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