USDA has issued two recent notices on the Conservation Reserve Program.
The first is just a reminder for farmers or landowners selling acres enrolled in CRP. Essentially, if CRP acres are sold, the original CRP contract must be revised and signed by the new owner within 60 days. If the contract is terminated by the new owner, the original CRP participant will be on the hook to refund USDA some payments:
If the new landowner elects not to continue the CRP contract, the contract will be terminated. When a contract is terminated, refund of the following payments plus interest is required from the original CRP participant: all annual rental payments, all cost share payments, signup incentive payments, and practice incentive payments. Liquidated damages are also assessed.
Refunds of payments will not be required in cases where the owner’s estate or the heirs do not succeed to the contract. There are other cases that do not require the refund of payments, when a participant loses control of the land, such as eminent domain.
The other notice was that under the new Farm Bill early termination of some CRP contracts will be allowed. Early outs are available for the following contract types:
- CP1-establishment of permanent grasses
- CP2-establishment of permanent grasses
- CP3-tree planting
- CP10-grass cover already established
- CP11-tree cover already established
Here’s a link to a USDA fact sheet on early CRP contract terminations under the new Farm Bill
As always, you can receive more information by contacting your local USDA Farm Services Agency office.
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