The Impact of Federal Programs on Wetlands - Vol. II
Changes to Deficiency Payments in the 1996 Farm Bill
The 1985 and 1990 Farm Bills made it very difficult for new
acreage to qualify for deficiency payments, thus severely
diminishing the incentive to convert wetlands to the production
of commodity crops. The 1996 Farm Bill completed this task,
making it impossible for new acreage to qualify for deficiency
payments, and linked the new Freedom to Farm payments to pre-existing crop base acreages. The bill replaced the traditional
crop-specific deficiency payments with "production flexibility
contracts." Contracts are for 7 years, provide fixed annual
payments (independent of market conditions or crop planted), and
allow considerable planting flexibility. Payments are based on
85% of past program yield and eligible acreage, and decline by
about 30% by the 7th year (2002).
Return to Chapter 3
URL: http://www.doi.gov/oepc/wetlands2/d-payments.html
Pagemaster: smoore@usgs.gov
Revised: 06-27-96