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Data dispute

Growers get a victory in 2018 Farm Bill, but industry still fighting to correct past years

March 2019
By Trista Crossley

In the struggle to help growers maintain their livelihoods, the Washington Association of Wheat Growers (WAWG) was able to help win one battle in the 2018 Farm Bill, but the war isn’t over yet.

In the past year, growers have been raising a red flag about why farm payment programs haven’t been triggered in spite of below-average yields, especially for the Agricultural Risk Coverage-County (ARC-CO) program. Growers in Spokane County had poor spring wheat yields in 2017, but no program payment was triggered. The average winter wheat yield in Benton County in 2017 was reported to be 82 bushels per acre, a total unlikely in an area that averages 8” of rain a year.

The culprit eventually turned out to be the National Agricultural Statistics Service (NASS) data used by the Farm Service Agency (FSA). In order for NASS to publish a number, they have to have at least 30 reports or reports that cover 25 percent of harvested acreage. In the Spokane County case, NASS was unable to collect enough spring wheat data through grower surveys to determine a spring wheat yield, so the much higher winter wheat data was used instead. In Benton County, NASS doesn’t differentiate between irrigated and nonirrigated wheat, resulting in a county average that doesn’t accurately reflect dryland yields.

In both cases, FSA’s hands were tied, as the directive to use only NASS data came from top U.S. Department of Agriculture (USDA) officials despite growers and industry groups advocating for the use of Risk Management Agency (RMA) data. RMA data is widely considered to be more accurate as it uses information collected for crop insurance that growers are legally required to accurately report. NASS relies on voluntary grower responses that may or may not be accurate.

WAWG and the national wheat organization, the National Association of Wheat Growers (NAWG), brought the issue to the attention of the U.S. Senate and House ag committees who included language in the 2018 Farm Bill directing FSA to prioritize data from RMA over NASS when determining yields. The farm bill also requires the secretary of agriculture to establish separate county yields when at least 5 percent of the acres in a county are irrigated or nonirrigated. This fixed the issues going forward, but WAWG is still working to get USDA to reconsider prior years where insufficient data might have negatively impacted program payments.

“This was an issue that WAWG worked very hard on for our growers,” said Michelle Hennings, executive director. “We did multiple fly-ins in 2018 while the farm bill was being written, and we brought up this issue at every meeting we had with the ag committees, FSA and NASS. We visited high-level USDA administrators and explained the problem. We wrote letters and made phone calls. Growers wrote letters and made phone calls. Sometimes it felt like we were on a hamster wheel, and no progress was being made. But in the end, we got the fix we needed going forward. Now we just need to get USDA to reconsider the data from previous years.”

Hennings said WAWG became aware of the problem in mid-2018. The first stop was at the state FSA office which directed WAWG to the national office.

“We did everything we could do at the state and national level as Washington state alone, but we were just one voice, and we needed the other states to weigh in. That’s when we turned to NAWG for help and getting support from other states,” Hennings said. “As a grower-supported organization, we want to work as hard as we can to make sure our farmers are being recognized when there are issues and to fix them. Sometimes those issues can be very difficult to fix because D.C. is so big, and we are only one state.”

While the issue of program payments being based on inconsistent data only came to light recently in Eastern Washington, the issue has been around since at least the implementation of the 2014 Farm Bill, according to Josh Tonsager, NAWG’s vice president of policy and communications.

“Part of the challenge came down to the 2014 Farm Bill, which gave USDA flexibility in determining the yield cascade,” Tonsager explained. The yield cascade tells USDA agencies where they can get data from for farm programs. “The first priority was NASS, then to similar counties, then to RMA. When they set that, they were unwilling to move from it. That was set in the first year of implementation.”

USDA was concerned that deviating from that established yield cascade could open the agency to possible litigation and put any pending appeals in jeopardy. As a result, FSA had very few options open to them. Tonsager said the only way to fix the issue was to include language in the 2018 Farm Bill. Coming to a consensus with other commodities, such as corn and soybeans, to support RMA as a yield source gave NAWG a lot of traction on Capitol Hill. Another reason they were successful is that the provision in the farm bill didn’t have a cost associated with it.

“Essentially (the 2018 Farm Bill) says in any county where a crop insurance product is available, USDA has to use county average yields from RMA for the ARC program. If the county doesn’t have a crop insurance product available, it gives discretion to USDA in how to determine the yield,” Tonsager said.

Going forward, wheat groups will be closely watching how this provision in the farm bill is implemented. Tonsager said NAWG wants to make sure that USDA uses a consistent data source—RMA data versus a combination of RMA and NASS data—when setting program benchmarks.

One of the first Spokane County people to recognize that there might be a problem was Jake Holling, vice president of ag lending at First Interstate Bank in Fairfield, Wash. Holling said he tracks yearly NASS yield data to help his customers make financial decisions. When he started looking at the 2017 Spokane County data, it looked…off.

“The data was higher than it had been historically. That year (2017) we had had strong winter wheat yields and poor spring wheat yields, so I was surprised,” he said. “I went back and looked at the NASS data for the 2017 crop year and saw that the final yield for the county matched the winter wheat yield exactly. But that wasn’t right because the spring wheat yield should have brought that down a bit.”

Holling contacted NASS, who told him they hadn’t gotten enough spring wheat responses to publish a separate spring wheat yield, so the winter wheat yield was used instead, resulting in no yield loss for spring wheat, hence no payment. Holling then went to the state FSA office who told him their hands were tied as they were required to use NASS data. By looking at historical data and based on the maximum payment for all the base wheat acres in Spokane County, Holling estimates that growers might have lost millions in 2017 ARC-CO payments.

About this same time, some Spokane County growers were also noticing a problem and making their concerns heard. Debbie McGourin was one of those growers, but she became aware of the issue while working on Spokane County’s open spaces program, which uses RMA yield data. She said she had a gut feeling that something wasn’t right. That was confirmed when she met with her banker in March and was told there would be no ARC-CO payment.

“I was like, we had a major crappy spring wheat yield in 2017, and that should have triggered a payment in 2018 that we were projecting,” she said. McGourin drafted a memo with leaders from the Spokane County Association of Wheat Growers and sent that to WAWG, who forwarded it to the state and national FSA and NASS offices. McGourin followed up that memo with additional letters to FSA, NASS and Ag Secretary Sonny Perdue in late 2018.

“As a Washington Association of Wheat Growers member, I had somebody to go to, and that person was Michelle (Hennings). She was persistent,” McGourin said. Through her contacts, Hennings eventually got a spreadsheet from the national FSA office (covering 2012-2017) that showed 2017 wasn’t the only year Spokane County was missing NASS data. No spring wheat data was reported in 2016, and no winter wheat data was reported in 2013. That spreadsheet indicated to McGourin that the whole benchmark for ARC-CO was suspect.

“Statistically, if you leave something blank, you usually have thousands of data points, so eliminating that blank cell out of your statistical database doesn’t really affect it. But when you have 12 numbers and you’ve left three of them blank, that affects your dataset,” she said. “Those calculations are the trigger point that says yes or no (if a payment is triggered). The calculations for our county have been incorrect since 2013.”

Jackie Tee is another farmer from Spokane County who figures she should have gotten an ARC-CO payment for her 2017 spring wheat. She wondered if one of the reasons NASS didn’t get enough spring wheat responses to their surveys that year was because of the fact that many farmers were unable to plant spring wheat early enough due to an unusually wet spring. While she is glad that the problem is fixed going forward, she believes FSA should go back and recalculate the years with missing data.

“On our farm, we didn’t do preventive planting. We planted every acre, and yes, we had a reduced yield,” she said. “I would just like them (FSA) to do the right thing, and the fact that a lot of people didn’t even get spring wheat seeded because of the wet spring and did preventive planting instead might have had something to do with it, but that shouldn’t have an impact on the rest of us who did plant spring wheat.”

In mid-February, WAWG officers and staff were able to discuss reconsidering program payments in previous years with several top USDA officials. That request was met with little enthusiasm, but Hennings said WAWG wasn’t giving up.

“It’s something we are still working on, and we will continue to bring up in our meetings with legislators and agency staff,” she said.

While WAWG and NAWG are working with USDA to try to get the agency to reconsider the Spokane County problem, there might be a glimmer of hope for Benton County growers.

A $5 million ARC-CO pilot program will allow state FSA offices to choose up to three counties with 2017 yields that vary the most from same-year yields in contiguous counties and recalculate the yields by using alternative data sources, such as RMA. Those new yield averages will then be presented to the national office for reconsideration of ARC-CO payments. In an email to WAWG, the Washington State FSA office said it is submitting Benton County as a candidate for some of the funds. Two contiguous counties—Klickitat County in Washington and Morrow County in Oregon—that don’t differentiate between irrigated and nonirrigated yields had an average winter wheat yield of 35.5 bushels, 46 bushels less than Benton County’s official NASS yield of 82 bushels.

Unfortunately, Spokane County’s situation looks to be a little shakier. According to the email from FSA, the yield disparity between Spokane and surrounding counties isn’t large enough to qualify for the pilot program. At press time, the state FSA office had no further information available on the status of Benton County and the pilot program but assured WAWG they were still working on it.