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ASFMRA Ag News - September 13, 2022

By ASFMRA Press posted 09-12-2022 11:31 PM


Eminent Domain Concerns Cloud Pipeline Proposals

Three carbon capture and sequestration (CCS) pipelines are proposed to crisscross the Midwest, collecting CO2 from ethanol plants and other partners to permanently isolate it underground. Stakeholder response has ranged from dissent to praise, but the possible use of eminent domain has landowners particularly fired up.

“Unfortunately, [eminent domain] has been painted and mischaracterized as something that is a trump card, and that is absolutely not the case,” says Elizabeth Burns-Thompson, vice president of government and public affairs at Navigator CO2 Ventures, one of the three pipeline companies.

Many landowners have expressed concern eminent domain, the right of government to take private property for public use, will be abused to bring these pipelines to fruition.

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Farmer Sentiment Improves But Producers Still Concerned About Rising Costs and Inflation

Farmer sentiment improved in August as the Purdue-CME Group Ag Economy Barometer index rose 14 points above its July reading to 117. The rise in the overall measure of agricultural producer sentiment was driven by increases in both the Index of Current Conditions, which rose 9 points in August to 118 and the Index of Future Expectations, which climbed 16 points in August to 116.

Producers this month were less worried about their farm’s financial situation than in July, although they remain concerned about a possible cost/price squeeze. When asked about their biggest concerns for the next year, over half (53%) of respondents chose higher input costs.

Other concerns included rising interest rates, input availability, and lower output prices chosen by 14, 12 and 11 percent of respondents, respectively. Despite this month’s improvement in sentiment, all three indices remain well below year ago levels.

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Flat Rock Appraiser Named in Conservation Easement Tax Fraud Scheme Loses License

The Flat Rock appraiser accused of aiding a conservation easement tax scheme has lost his license, according to a North Carolina Appraisal Board consent order.

Walter Douglas "Terry" Roberts II, one of seven people named by the Department of Justice in the alleged scheme that involved the sale of over $1.3 billion in fraudulent tax deductions, agreed via the consent order to surrender his license after the board found he had created misleading appraisals for three conservation easements.

"Respondent's reports did not reveal any explanation as to why the sales used to establish the value of the subject after the imposition of the easement were any more appropriate than the sales that were considered before the imposition of the easement," the consent order signed by Roberts, the respondent, said. "As a result, Respondent did not execute an appropriate scope of work with regard to the three appraisals which were prepared for the purpose of establishing a loss in value due to the imposition of a conservation easement."

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What a Rancher Rebellion Means for California’s Water

The land that Jim Scala and his family have been ranching for three generations is parched and brown as far as he can see. The pond where his cattle used to drink is now a puddle, ringed with cracked mud.

In other years, water pumped from the Shasta River would have periodically flooded this land, keeping his pasture alive and pond full. But the state had ordered Scala and other ranchers and farmers in rural Siskiyou County to stop irrigating when the drought-plagued river dipped below a certain level.

With bills mounting from trucking in water and buying hay to replace dead pasture, and facing the prospect of selling half his herd, Scala and others made a decision to defy the state’s order.

“We said, ‘To hell with it,’” Scala said. “We’re starting the pumps.”

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Farms Grapple With How to Maintain Pandemic Agritourism Boom

There’s an Apple Trail in Sonoma County and a Cranberry Highway in Wisconsin. You can walk along the Wildflower Hike in Oregon or amble across the Bourbon Trail in Kentucky. Each of these adventures falls under the banner of agritourism, involving activities that bring the general public to farms or ranches. It might seem frivolous to some, but the agritourism industry presents a boon of opportunities for many states and regions, allowing farms to keep doing what they do best: feed the world.

The trick for farmers is getting people to the farm in the first place. During the pandemic, farm tours and stays have been an easy draw for cooped-up families looking to get away. Agritourism has grown in popularity over the last two decades, with revenue tripling between 2002 and 2017. And with the strict travel restrictions during the early days of the COVID-19 pandemic, agritourism proved even more popular, providing a welcome solution for people looking to get away without leaving their state.

Now, farmers are working to maintain that surge of interest.

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ASFMRA Government Relations Update

Civil Rights and Consumer Advocates Call for Appraisal Reform

The National Fair Housing Alliance (NFHA) and other civil rights and consumer advocates called on the House Financial Services Committee, the Senate Banking Committee, and the Biden Administration to support meaningful appraisal reform legislation in a letter last week. The NFHA was commissioned by the Appraisal Subcommittee (ASC) earlier this year to review appraisal bias. The letter reflects recommendations from that report. It is highly unlikely Congress will undertake any legislative action on this topic this year.

American Bankers Association Appraisal Podcast

The American Bankers Association podcast focused on the appraisal industry last week. The podcast runs over 40 minutes, but is a must listen for appraisers who wish to learn more about the current turmoil in the appraisal industry.

Biden Administration Requests 2022 Disaster Payments

The Biden Administration transmitted a supplemental request to Congress which includes a $1.5 billion request (page 47) for 2022 disaster payments. The Senate returned to Washington D.C. last week and the House returns this week. A top priority for Congress before the end of the month is avoiding a government shutdown. Congress is widely expected to pass a Continuing Resolution (CR) to keep the government open passed the November midterm election. Recall the $10 billion emergency relief that became the ERP was attached to the CR for FY 2022. With the Biden Administration requesting additional emergency payments, the likelihood that Congress will provide them increases greatly.

RMA Announces WFRP and Micro Farm Coverage Changes for 2023

RMA is expanding eligibility for Whole-Farm Revenue Protection (WFRP) and Micro Farm, making them more accessible to America’s agricultural producers. The changes effective for 2023 include doubling the maximum insurable revenue under WFRP to $17 million, and more than tripling the size of farm operations eligible for Micro Farm, up to $350,000. Additional changes to WFRP are expected to reduce paperwork requirements for insureds.

ERS Forecasts Higher Net Farm Income for 2022

The Economic Research Service (ERS) said it expects net farm income for 2022 to rise 5.2 percent, to $147.7 billion, from 2021, with cash receipts for agricultural commodities at a record level. This expected increase follows an increase of $45.9 billion (48.5 percent) in 2021 from 2020.

Total production expenses, including those associated with operator dwellings, are forecast to increase by $66.2 billion (17.8 percent) in 2022 to $437.3 billion. All categories of expenses are forecast to be higher in 2022 in nominal terms, with feed and fertilizer-lime-soil conditioner purchases expected to see the largest dollar increases.

Direct Government farm payments are forecast at $13.0 billion in 2022, a $12.8 billion (49.7 percent) decrease from 2021 levels. Direct Government farm payments include Federal farm program payments paid directly to farmers and ranchers but exclude USDA loans and crop insurance indemnity payments. Much of this decline is because of lower supplemental and ad hoc disaster assistance to farmers and ranchers related to the coronavirus (COVID-19) pandemic compared with 2021.

GAO Faults FSA CFAP Payments

The Government Accountability Office (GAO) released a report last week urging the Farm Service Agency (FSA) to review Coronavirus Food Assistance Program (CFAP) payments more rigorously to producers. In 2020 and 2021, the FSA provided $31 billion in aid to over 950,000 producers of agricultural commodities—including crops, dairy, and livestock—to help offset losses and costs associated with the pandemic. The GAO faulted the FSA’s methods used to review the claims the producers submitted for payment. For example, the GAO reviewed the claims of 90 producers, and over half didn't provide support for their payments.