Search Penny Hill Press

Monday, September 17, 2012

Trade Adjustment Assistance for Farmers

Remy Jurenas
Specialist in Agricultural Policy

The Trade Adjustment Assistance for Farmers (TAAF) program provides technical assistance and cash benefits to producers of agricultural commodities and fishermen who experience adverse economic impacts caused by increased imports. Congress first authorized this program in 2002, and made significant changes to it in the 2009 economic stimulus package (P.L. 111-5). The 2009 revisions were intended to make it easier for commodity producers and fishermen to qualify for program benefits. It also provided over $200 million in funding through December 2010. More recently, P.L. 112-40 (enacted in October 2011) authorized $90 million in each of FY2012 and FY2013, and $22.5 million for the first quarter of FY2014, subject to future appropriations.

The U.S. Department of Agriculture (USDA) is required to follow a two-step process in administering TAAF program benefits. First, a group of producers must be certified eligible to apply. Second, a producer in a certified group must meet specified requirements to be approved to receive technical assistance and cash payments.

To be certified, a group must show that imports were a significant cause for at least a 15% decline in one of the following factors: the price of the commodity, the quantity of the commodity produced, or the production value of the commodity. Once a producer group is certified, an individual producer within that group must meet three requirements to be approved for program benefits. These include technical assistance with a training component, and financial assistance. A producer must show that (1) the commodity was produced in the current year and also in one recent previous year; (2) the quantity of the commodity produced decreased compared to that in a previous year, or the price received for the commodity decreased compared to a preceding threeyear average price; and (3) no benefits were received under any other trade adjustment assistance program. The training component is intended to help the producer become more competitive in producing the same or another commodity. Financial assistance (capped at $12,000 over a threeyear period for an approved producer) is to be used to develop and implement a business adjustment plan designed to address the impact of import competition.

Since 2009, USDA has certified 10 of the 30 petitions filed by producers of five commodity groups—shrimp, catfish, asparagus, lobster, and wild blueberries. In FY2010, USDA approved about 4,500 agricultural producers who applied for training and cash assistance under three certifications. Under the seven FY2011 certified petitions, USDA approved about 5,700 producers. Program benefits in both years will mostly flow to shrimp producers.

USDA continues, in stages, to disburse financial assistance to producers approved to receive benefits under the FY2010 and FY2011 programs as they meet certain benchmarks. Any future program activity depends on whether Congress appropriates funds to support the authority enacted in P.L. 112-40. In its FY2013 budget request submitted February 13, 2012, the Obama Administration did not request any appropriations for the TAAF program.

The Government Accountability Office (GAO) has examined which commodities were certified under the revised TAAF criteria, presented data on the producers approved to receive program benefits, and analyzed the approach USDA followed to evaluate TAAF’s effectiveness. GAO recommends that USDA require spouses who apply for assistance to submit documentation on how they contribute to producing a commodity, take steps to ensure that the program’s financial assistance component is used for intended purposes, and adopt a longer-term approach to evaluate its effectiveness.

Date of Report: September 5, 2012
Number of Pages: 15
Order Number: R40206
Price: $29.95

To Order:

R40206.pdf  to use the SECURE SHOPPING CART


Phone 301-253-0881

For email and phone orders, provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.