Sooner24
7/23/2007, 05:35 PM
Now I know why you went into agriculture.
http://www.washingtonpost.com/wp-dyn/content/article/2007/07/22/AR2007072201128.html
Deceased Farmers Got USDA Payments
Study Faults Lack Of Case Reviews
By Sarah Cohen
Washington Post Staff Writer
Monday, July 23, 2007; A01
The U.S. Department of Agriculture distributed $1.1 billion over seven years to the estates or companies of deceased farmers and routinely failed to conduct reviews required to ensure that the payments were properly made, according to a government report.
In a selection of 181 cases from 1999 to 2005, the Government Accountability Office found that officials approved payments without any review 40 percent of the time.
The report cited a 1,900-acre soybean and corn farm in Illinois that collected $400,000 on behalf of an owner who lived in Florida before his death in 1995. The company did not notify the government of the death but certified each year that the dead shareholder, who owned 40 percent of the company, was "actively engaged" in managing the farm.
Most estates are allowed to collect farm payments for up to two years after an owner's death, giving heirs time to restructure their businesses and probate the will. After that, local USDA officials must certify every year that the estate is still farming and has remained open for reasons other than simply collecting subsidies.
But the GAO report found that the Agriculture Department depends on heirs and businesses to alert the agency to deaths and does not use other sources, such as Social Security records, to confirm eligibility. The report was prepared at the request of Sen. Charles E. Grassley (R-Iowa), a frequent critic of large subsidies to wealthy farms. It is expected to be publicly released Tuesday at a Senate Finance Committee hearing.
"Farm payments are meant for those who need some help getting through the tough times," Grassley said last week. "Clearly there are loopholes that should be closed and laws that need to be followed."
In a letter responding to the GAO report, the Agriculture Department said that the payments were not necessarily examples of fraud or abuse and that auditors did not prove any specific cases of cheating. The department's field offices defended the practice of routinely paying dead farmers' estates without fully investigating the claims, citing staff shortages and competing priorities. The agency also said that any overpayments would amount to less than 1 percent of farm subsidies paid between 1999 and 2005.
GAO auditors found that in addition to the 40 percent of cases not reviewed by the USDA, 38 percent had "weaknesses," including "nonexistent or vague" documentation. The GAO said it could not determine from its examination whether the government improperly overpaid the estates or how much any excess might be.
An Indiana corporation that was owned entirely by one person never notified the government of the owner's death in 1993 and continued to collect unspecified payments for a decade before new owners filed for farm benefits. The government made $567,000 in payments to an Alabama estate over seven years on behalf of an owner who died in 1981. Another estate continued to receive unspecified payments on behalf of a person who died in 1973 -- more than three decades ago -- without any investigation or review.
The GAO said it found that five executors of estates had simply told the government
http://www.washingtonpost.com/wp-dyn/content/article/2007/07/22/AR2007072201128.html
Deceased Farmers Got USDA Payments
Study Faults Lack Of Case Reviews
By Sarah Cohen
Washington Post Staff Writer
Monday, July 23, 2007; A01
The U.S. Department of Agriculture distributed $1.1 billion over seven years to the estates or companies of deceased farmers and routinely failed to conduct reviews required to ensure that the payments were properly made, according to a government report.
In a selection of 181 cases from 1999 to 2005, the Government Accountability Office found that officials approved payments without any review 40 percent of the time.
The report cited a 1,900-acre soybean and corn farm in Illinois that collected $400,000 on behalf of an owner who lived in Florida before his death in 1995. The company did not notify the government of the death but certified each year that the dead shareholder, who owned 40 percent of the company, was "actively engaged" in managing the farm.
Most estates are allowed to collect farm payments for up to two years after an owner's death, giving heirs time to restructure their businesses and probate the will. After that, local USDA officials must certify every year that the estate is still farming and has remained open for reasons other than simply collecting subsidies.
But the GAO report found that the Agriculture Department depends on heirs and businesses to alert the agency to deaths and does not use other sources, such as Social Security records, to confirm eligibility. The report was prepared at the request of Sen. Charles E. Grassley (R-Iowa), a frequent critic of large subsidies to wealthy farms. It is expected to be publicly released Tuesday at a Senate Finance Committee hearing.
"Farm payments are meant for those who need some help getting through the tough times," Grassley said last week. "Clearly there are loopholes that should be closed and laws that need to be followed."
In a letter responding to the GAO report, the Agriculture Department said that the payments were not necessarily examples of fraud or abuse and that auditors did not prove any specific cases of cheating. The department's field offices defended the practice of routinely paying dead farmers' estates without fully investigating the claims, citing staff shortages and competing priorities. The agency also said that any overpayments would amount to less than 1 percent of farm subsidies paid between 1999 and 2005.
GAO auditors found that in addition to the 40 percent of cases not reviewed by the USDA, 38 percent had "weaknesses," including "nonexistent or vague" documentation. The GAO said it could not determine from its examination whether the government improperly overpaid the estates or how much any excess might be.
An Indiana corporation that was owned entirely by one person never notified the government of the owner's death in 1993 and continued to collect unspecified payments for a decade before new owners filed for farm benefits. The government made $567,000 in payments to an Alabama estate over seven years on behalf of an owner who died in 1981. Another estate continued to receive unspecified payments on behalf of a person who died in 1973 -- more than three decades ago -- without any investigation or review.
The GAO said it found that five executors of estates had simply told the government