FSA answers FAQs specific to the ARC/PLC program 

1. How is the new yield calculated?  The crops' updated yield will be the simple average of the crop's certified yield, excluding the years of zero plantings, times 90 percent If the certified yield is less than 75 percent of the county...Date Updated: 09/25/2014
2. Does the new farm bill allow for a reallocation of crop base acres?  Yes, the 2014 Farm Bill allows for a one-time adjustment to the farm's base acres. This adjustment is called a reallocation of base acres on the farm. The farm bill does not allow for an increase in...Date Updated: 09/25/2014
3. Are there tools available to assist producers in making a program election?  Congress provided $3 million for universities to develop web-based decision tools for ARC-CO, ARC-IC, PLC, and other 2014 Farm Bill programs. In addition, Congress provided $3 million for producer...Date Updated: 09/25/2014
4. What happens to my farm's base acres and yields if the owner does not allow an update?  The farm will retain the base acres and counter-cyclical yields in effect on Sept. 30, 2013, excluding upland cotton base acres for the 2014 - 2018 ARC/PLC programs. Upland cotton base acres are...Date Updated: 09/25/2014
5. What is the reallocation formula?  Base acres are reallocated using the acreage of each covered commodity in proportion to the 4-year average of acres that were planted or considered planted (P&CP) to all covered commodity crops...Date Updated: 09/25/2014
6. What is the payment yield for PLC?  The current program payment yield under the 2014 Farm Bill is the farm's counter-cyclical (CC) yield in effect on September 30, 2013. The owner of the farm may choose to update the CC yield; this...Date Updated: 09/25/2014
7. How is the ARC-IC farm benchmark established - is it based on the current year covered commodities or the historical benchmark history of covered commodity plantings?  The ARC-IC farm benchmark revenue and guarantee are based on current year plantings of covered commodities, not historical plantings on the farm. The farm benchmark is calculated by multiplying the...Date Updated: 09/25/2014
8. Who makes the decision to update base acres?  The owner(s) of the farm make(s) the base reallocation determination.   Date Updated: 09/25/2014
9. Can an owner choose to update the CC yield even though they later elect the ARC program for the farm?  Yes, the CC yield can be updated regardless of the program elected for the farm: PLC, county ARC (ARC-CO) or individual ARC (ARC-IC).  Even though the updated yield will only be used for making...Date Updated: 09/25/2014
10. What are the base update options?  The owner(s) of the farm may either: 1) retain the base acres of covered commodities on the farm as of Sept. 30, 2013, or 2) choose to reallocate bases.  Date Updated: 09/25/2014
11. What happens if I choose Supplemental Coverage Option (SCO) and sign up for ARC?  SCO will first be available for the 2015 crop year's winter wheat, where you must make your crop insurance coverage decisions for fall-planted crops (including SCO) by the sales closing date...Date Updated: 09/25/2014
12. How are approved prevented plant acres used under the 2014 Farm Bill and the ARC/PLC program?  A farm's approved prevented planted are included for base reallocation purposes for 2009-2012.  Date Updated: 09/25/2014
13. What is the time period used to determine a new yield?  To update a yield, the owner(s) of the farm must certify as to the updated yield for each crop on the farm. The owner will be required to certify a crop yield for each of the years the crop was...Date Updated: 09/25/2014
14. Who must make the program election?  All producers, including owners and operators on the farm with a share of the 2014 cropland must agree to the program election: PLC, ARC-CO or ARC-IC.Date Updated: 09/25/2014
15. What are my options for program participation if I have elected PLC or ARC-CO?  Producers on the farm participating in ARC-CO/PLC can elect either ARC-CO or PLC on a crop- by-crop basis on each farm. The program election for each crop remains in effect for each crop for the life...Date Updated: 09/25/2014
16. How is a payment rate calculated for an ARC-IC farm?  When the actual revenue of all crops planted on the ARC-IC farm, summed across all farms, on a per planted acre payment basis is below the ARC-IC  guarantee for the farm, again summed...Date Updated: 09/25/2014
17. Under ARC-Individual Coverage, how will farms be treated when 100 percent of the acreage is prevented from being planted?  In cases where the ARC-IC farm has approved prevented planted acres for 100 percent of the intended planted covered commodities, the individual farm actual revenue for that year will be zero. The...Date Updated: 09/25/2014
18. Who makes the decision to update yields?  The owner(s) of the farm make(s) the yield update determination. This determination is on a crop-by-crop basis for the farm. The owner(s) may choose to update the yield for one crop on the farm and...Date Updated: 09/25/2014
19. What crops may have base acres reallocated and yields updated?  Only covered commodities may have base acres reallocated and yields updated. Covered commodities include wheat, oats, barley, corn, grain sorghum, rice, soybeans, sunflower seed, rapeseed, canola...Date Updated: 09/25/2014
20. Must the covered commodity be planted on a farm to receive a PLC payment? Relatedly, how is generic base treated?  Under PLC, the covered commodity doesn't need to be planted to receive payment. The PLC payment is issued based on 85 percent of the crop's base acres. To receive PLC payments on generic base acres...Date Updated: 09/25/2014
21. What program eligibility requirements apply to the PLC, ARC-CO and ARC-IC programs?  Program eligibility and compliance requirements include:   Highly Erodible Land Conservation and Wetland Conservation Payment Limitation  Adjusted Gross Income A complete acreage...Date Updated: 09/25/2014
22. Does the 2014 Farm Bill allow separate PLC yields for dry land and irrigated practices on the same farm?  No. Farms will only have one yield. The PLC yield for a crop that is both irrigated and non-irrigated will either be the farm's current counter-cyclical yield or an updated yield, which is based on...Date Updated: 09/25/2014
23. A producer has several Farm Service Agency (FSA) farm numbers. Can he/she select different programs for each farm?  Yes. The producer can elect ARC-CO or PLC on one or more farms and/or can elect ARC-IC on one or more farms. All farms with an ARC-IC election will be combined to calculate the revenue guarantee...Date Updated: 09/25/2014
24. What happens to the farm election when a new owner or operator acquires the farm?  The farm's program election made during the election period will remain in effect for the life of the farm bill, regardless of who acquires an interest in the land after the election.Date Updated: 09/25/2014
25. How is a payment rate calculated for a covered commodity?  When the actual revenue for the covered commodity in the county on a per acre payment basis is below the ARC-CO guarantee, an ARC-CO payment is triggered for that crop and county. Payment is made to...Date Updated: 09/25/2014
26. Are prevented plant acres used under the ARC program - county or individual?  No. Section 1117 of the 2014 Farm Bill requires that planted acres be used for calculating coverage guarantees and actual revenues. See the exception noted below.Date Updated: 09/25/2014
27. How is the county average yield determined?  2008-2012 county average yields are based upon NASS data. In the absence of NASS data, RMA or Extension data may also be used.Date Updated: 09/25/2014
28. What happens to the upland cotton base acres I had on my farm?  Cotton is no longer considered a covered commodity; cotton base acres will now be called "generic base acres." For ARC/PLC, if "generic base acres" are planted to a covered commodity, they will be...Date Updated: 09/25/2014
29. Once I've taken action regarding base reallocation and yield updates, can I change my mind? Any base reallocation and yield updates can be changed through the end of the ARC/PLC time designated to complete.Date Updated: 09/25/2014
30. What are my options for program participation if I have elected ARC-IC?  An ARC-IC election is applicable to ALL covered commodities on the farm. In addition, a producer's ARC-IC revenue guarantee and actual revenue are determined by combining the producer's interest on...Date Updated: 09/25/2014
31. Can you simply explain the PLC program?  The PLC program provides payments when the market year average price for a covered commodity falls below the crop's reference price specified in the 2014 Farm Bill.   Date Updated: 09/25/2014
32. How is a payment rate determined for a covered commodity under PLC?  The payment rate for a covered commodity is the difference between the crop's reference price and the national market year average price, when the latter is higher than the national average loan rate...Date Updated: 09/25/2014
33. Can you simply explain the ARC-CO program?  The ARC-CO program provides revenue loss protection for revenue losses at the county level. A determination regarding revenue loss for each covered commodity with enrolled bases acres in the county...Date Updated: 09/25/2014
34. Can you simply explain the ARC-IC program?  The ARC-IC program provides revenue loss protection for revenue losses determined at the farm level.  A determination regarding revenue loss for each covered commodity planted on the farm...Date Updated: 09/25/2014
35. What happens when one ARC-IC farm participates in the annual program and one ARC-IC farm does not participate?  Only ARC-IC farms participating under contract in the annual program will be included in the ARC-IC benchmark, guarantee, and actual revenue calculations.  The nonparticipating farm(s) will...Date Updated: 09/25/2014
36. When are payments authorized for the ARC/PLC Programs?  Payments for the 2014-2018 crops are issued the later of Oct. 1 of the subsequent crop year or when the national average market year price is published by USDA.  Date Updated: 09/25/2014
37. Does the new farm bill allow for an update of yields for crops with base acres?  Yes, the Agricultural Act of 2014 allows for an update to a farm's program payment yields.   Date Updated: 09/25/2014
38. For how many years do the program elections remain in effect?  The election decision made for the 2014 crop year will remain in effect for that farm through the 2018 crop.Date Updated: 09/25/2014
39. What happens if all producers (all owners, operators, and other tenants) with an interest in the farm do not agree and do not sign the election by the deadline?  All crops on the farm will default to the PLC program for the life of the farm bill. The farm will not earn a payment for the 2014 crop year.Date Updated: 09/25/2014
40. Can a person with power of attorney (POA) authority make an election for an owner?  Yes, if the POA has been completed for "All current and future programs" and "All actions."Date Updated: 09/25/2014
41. Once I make an election, can I change my mind?  An election made for a farm can be changed through the end of the election period (which will be determined during the 2014-2015 winter season).Date Updated: 09/25/2014
42. What is the PLC payment formula?  The payment formula is: The crop's base acres, times 85 percent, times the PLC payment rate per unit of production.Date Updated: 09/25/2014
43. Is the covered commodity required to be planted on a farm to receive an ARC-CO payment? Relatedly, how is generic base treated?  Under ARC-CO, the covered commodity is not required to be planted to receive the payment. To receive ARC-CO payments on generic base acres, a covered commodity must be planted on generic base...Date Updated: 09/25/2014
44. What is the payment formula?  The payment formula is the crop's base acres, times 85 percent, times the ARC-CO payment rate per acre.Date Updated: 09/25/2014
45. Is the covered commodity required to be planted on a farm to receive an ARC-IC payment? Yes. Current year planted acres of covered commodities on an ARC-IC farm are used to determine if a revenue loss occurs on the ARC-IC farm.Date Updated: 09/25/2014
46. Do producers have to file a new AD-1026 if they already had one on file with FSA?  No, it is not necessary for producers with an existing AD-1026 on file to file a new AD-1026 unless there are changes to the answers on the existing AD-1026 on file.Date Updated: 09/25/2014
47. What happens if I reconstitute a farm after the election is made? Once an election for a farm is made, the reconstituted farm(s) retain that election through the life of the farm bill.Date Updated: 09/25/2014
48. What is the payment formula?  The payment formula is the total base acres on the ARC-IC farm, times 65 percent, times the ARC-IC payment rate per acre.Date Updated: 09/25/2014
49. How does the farm ARC-IC formula work when there are two or more farms that elected and participated in ARC-IC?  All farms in a State in which the producer has an interest are aggregated in the ARC-IC formula to determine if the ARC-IC farm suffered a revenue loss.Date Updated: 09/25/2014
50. Is annual production reporting required on each covered commodity planted?  Yes.  Date Updated: 09/25/2014
51. Will an annual contract to participate in the ARC/PLC program be required in order to receive payments?  Yes.  Date Updated: 09/25/2014
52. Must a producer carry federal crop insurance in order to be eligible for the ARC/PLC program? No.Date Updated: 09/25/2014
53. Who must sign the annual contract to participate in PLC, ARC-CO or ARC-IC?  All owners, operators and tenants with an interest in the base acres on the farm must sign the annual contract. Cash leases may be provided in lieu of obtaining a signature from an owner.Date Updated: 09/25/2014

 University of Arkansas Division of Agriculture Extension 2014 Farm Bill Web Site 

Disclaimer:

• This information is intended to be for educational purposes only.
• Without Farm Service Agency (FSA) "FINAL" Rules and Regulations all research and information are preliminary.
• More (and better) research and information will be available before most decisions need to be made

Issued by Robert Coats

Division of Agriculture

University of Arkansas