Average Farm Subsidy Payments, by State, 2002

Order Code RL32590
CRS Report for Congress
Received through the CRS Web
Average Farm Subsidy Payments, by State, 2002
September 16, 2004
Jasper Womach
Specialist in Agricultural Policy
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

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Average Farm Subsidy Payments, by State, 2002
Summary
The U.S. Department of Agriculture makes direct subsidy payments through the
Commodity Credit Corporation to farmers for commodity price and income support,
certain conservation and environmental activities, and some disaster losses. In 2002,
these direct farm subsidy payments amounted to $12.151 billion.
This report examines the distribution of these payments among states, calculates
the average size of payments going to recipient farms in each state, and distinguishes
between payments received by farm operators and landlords. This information is
intended to aid in policy debates about subsidizing some farms but not others,
changing per-person payment limits, and the altering eligibility rules for landlords to
receive payments.
More money went to Texas ($1.2 billion) than any other state. Texas along with
the next 10 leading states received 56% of total farm subsidy payments. These states
were largely concentrated in the nation’s central farm belt, where much of the
subsidized corn, soybeans, wheat, cotton, and rice are produced. Also ranking high
were California (due to cotton and rice) and Georgia (due to peanuts).
The subsidy payments were made to the operators and landlords of 707,596
farms (one-third of all farms in the nation). However, in some states a much higher
proportion of the farms were subsidized (e.g., North Dakota, 78%, and Iowa, 70%).
On average, the payments amounted to $17,172 per subsidized farm. The range
was from a low of $3,401 per subsidized farm in West Virginia to a high of $90,214
per subsidized farm in California. Farm operators received an average of $9,251
each and landlords received an average of $5,617 each.
Data on state averages obscure the high concentrations of payments to a
relatively small proportion of the farms receiving subsidies. While there were a total
of 1,705,514 separate “persons” that received payments in 2002, 50% of the subsidy
payments went to 85,358 persons (or just 5% of the recipients).
This report is intended as a reference and informational resource and is not
expected to be regularly updated.

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Contents
Farm Subsidy Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
State-By-State Distribution of Total Farm Subsidy Payments . . . . . . . . . . . . 7
Farms Receiving Subsidy Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Subsidy Payments per Farm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Subsidy Payments to Farm Operators and Landlords . . . . . . . . . . . . . . . . . 19
Concentration of Farm Subsidy Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 27
List of Figures
Figure 1. Total Farm Subsidy Payments, 1996-2002 . . . . . . . . . . . . . . . . . . . . . . 2
Figure 2. Farm Subsidy Payments by Major Category, 2002 . . . . . . . . . . . . . . . . 3
Figure 3. Total Farm Subsidy Payments in 2002 . . . . . . . . . . . . . . . . . . . . . . . . . 8
Figure 4. Percentage of Farms Receiving Subsidies in 2002 . . . . . . . . . . . . . . . 12
Figure 5. Average Subsidy Payment per Farm in 2002 . . . . . . . . . . . . . . . . . . . 16
Figure 6. Average Number of Landlords per Farm Receiving Subsidies
in 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
List of Tables
Table 1. Farm Subsidy Payments, by Program, 2002 . . . . . . . . . . . . . . . . . . . . . . 5
Table 2. Commodity Subsidy Payments, by Commodity, 2002 . . . . . . . . . . . . . . 6
Table 3. Subsidy Payments to Farm Operators and Landlords, by State, 2002 . . 9
Table 4. Proportion of Farms Receiving Subsidy Payments, by State, 2002 . . . 13
Table 5. Total Subsidy Payments Per Farm, by State, 2002 . . . . . . . . . . . . . . . . 17
Table 6. Subsidy Recipients Per Farm, by State, 2002 . . . . . . . . . . . . . . . . . . . . 21
Table 7. Average Subsidy Payments to Farm Operators, by State, 2002 . . . . . . 23
Table 8. Average Subsidy Payments to Landlords, by State, 2002 . . . . . . . . . . . 25
Table 9. Farm Subsidy Payments Reach a Large Number of Recipients,
But Most of the Money Goes to a Few . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

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Average Farm Subsidy Payments,
by State, 2002
Most federal farm subsidies are made as mandatory direct payments to
producers from the U.S. Department of Agriculture’s (USDA’s) Commodity Credit
Corporation (CCC).1 These include commodity price and income support programs,
certain conservation programs, and select disaster assistance programs. CCC direct
payments to farmers in 2002 are examined in this report.2
The primary data sources are the 2002 Census of Agriculture (available at
[http://www.nass.usda.gov/census/]) and the Environmental Working Group’s
(EWG’s) Farm Subsidy Database (available at [http://ewg.org/farm/home.php]).
The EWG database is a compilation from CCC payment information supplied by
USDA’s Farm Service Agency (FSA). FSA’s national network of county offices
administers the subsidy programs and writes the CCC checks to the subsidy
recipients.3 These two data sets facilitate a state-by state examination of payments
and the division of payments between farm operators and landlords.
There is unpredictability about the timing and size of market price movements
as well as natural disasters. Consequently, the size of farm subsidies varies from year
to year. Figure 1 shows that from 1995 through 2002 annual farm subsidy payments
ranged from a low of $7.2 billion to a high of $23.5 billion, averaging $14.5 billion
annually over the eight-year period.4 Commodity price and income support accounts
1 The term mandatory means that the payments are not dependent on annual congressional
appropriations. Payment obligations to farmers meeting the rules of the various subsidy
programs are covered by the CCC. The CCC uses its borrowing authority to obtain needed
funds from the U.S. Treasury. Later, Congress appropriates monies to reimburse the CCC,
so it can repay the Treasury.
2 The USDA does administer other farm subsidy programs that are not financed through the
CCC and are not examined in this report. Among these are crop insurance (costing about
$2 billion annually in premium subsidies), and farm ownership and operating loans for
limited resource farmers (costing nearly $200 million annually in loan subsidies).
3 The data obtained by EWG are developed in FSA county offices and pertain to the farm
in the county and not the address of the recipient. Recipients are unduplicated but may
receive multiple payments from multiple programs throughout the year. Generally, data
pertain to the calendar year of payment, but there may be exceptions.
4 The data reported by EWG for 2002 may include a combination of calendar year and crop
year data, but are characterized by EWG as calendar year payments. The EWG data shown
in Figure 1 differ only slightly from calendar year direct payment data published by USDA’s
Economic Research Service. The ERS payment numbers for 1995 through 2002 are $7.3
billion, $7.3 billion, $7.5 billion, $12.4 billion, $21.5 billion, $22.9 billion, $20.7 billion,
$11.0 billion. The CCC maintains its most detailed accounts by fiscal year, but these
(continued...)

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CRS-2
for most farm subsidy payments. As shown in Figure 2, commodity payments
amounted to 73% of CCC’s total farm subsidy payments in 2002.
The year 2002, with total farm subsidy payments of $12.151 billion, was
selected for examination in this report because of data availability. At the same time,
it is fairly close to annual average total payments from 1995 through 2002. However,
2002 is unique in that peanut producers received one-time quota buyout payments of
about $1 billion. Nearly half the peanut quota buyout payments were concentrated
in Georgia ($483 million), with the remainder divided largely among Texas ($153
million), Alabama ($150 million), North Carolina ($107 million), Virginia ($67
million), Oklahoma ($62 million), and Florida ($48 million).5
Figure 1. Total Farm Subsidy Payments, 1996-2002
4 (...continued)
records do report payments at the state or recipient level. Data from the 2002 Census of
Agriculture are for calendar year 2002.
5 A full description of the peanut marketing quota buyout program is available in CRS
Report RL30924, Peanut Program Policy Issues.

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CRS-3
Figure 2. Farm Subsidy Payments by Major Category, 2002

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CRS-4
Farm Subsidy Programs
Most commodity support program payments are linked to market prices.6 When
market prices decline, commodity support payments increase in order to support the
income of producers whose revenue otherwise would decline. Conservation
payments are made to encourage farmers to remedy environmental problems.
Disaster assistance is provided when crop and livestock production is substantially
damaged or destroyed by natural disasters such as drought, flood, and disease,
thereby reducing revenue and/or increasing the expenses of producers.7
Table 1 presents a program-by-program list of payments in 2002. Some of the
payments (and refunds) shown in Table 1 were authorized by the 1996 farm bill,
which originally covered the 1996 through 2002 crops. The 2002 farm bill (P.L. 107-
171, the Farm Security and Rural Investment Act of 2002) was enacted on May 13,
2002, and was made immediately applicable to 2002 crops. So, 2002 was a year of
transition from the previous Production Flexibility Contract Payments to the new
Direct and Counter-Cyclical Payments. Also, Counter-Cyclical Payments became
the permanent replacement for ad hoc Market Loss Payments.
6 Production Flexibility Contract Payments and decoupled Direct Payments for grain and
cotton producers are exceptions. These payments were based on historical production of
each of the grain and cotton crops only. Recipients of these payments were able to change
their mix of crops or even produce nothing.
7 Eligibility requirements for payments are specified in the law for each program. The
payment triggers and size of commodity support payments are based upon specified price
levels (an indirect income test) or physical damage levels for disaster assistance (a loss test).

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CRS-5
Table 1. Farm Subsidy Payments, by Program, 2002
Subsidy
Number of
Payment Per
Program / Category
Payments
Recipients
Recipient
Total Farm Subsidies
$12,150,563,185
1,705,514
$7,124
Commodity Subsidies
$8,831,971,671
1,319,110
$6,695
Production Flexibility Contract
Payments
$3,499,997,512
1,145,725
$3,055
Loan Deficiency Payments (LDPs)
$1,296,591,777
334,659
$3,874
Peanut Quota Buyout and
Miscellaneous Payments
$1,174,674,015
130,516
$9,000
Commodity Certificates
$940,785,178
17,972
$52,347
Dairy Payments
$848,186,106
71,968
$11,786
Direct and Counter-Cyclical Payments
$570,589,219
210,540
$2,710
Marketing Loan Gains
$458,385,698
55,588
$8,246
Lamb Payments
$32,401,797
17,210
$1,883
Market Loss Assistance, Non-
Supported Commodities
$5,509,671
18,051
$305
Livestock Indemnity Program
$3,173,145
2,099
$1,512
Market Loss Assistance, Supported
Commodities
$1,417,765
1,287
$1,102
Total LDP-like Grazing Payments
$480,947
442
$1,088
Oilseed Program
$234,989
360
$653
Wool and Mohair Payments
-$16,025
1
-$16,025
Deficiency Payments
-$440,125
456
-$965
Conservation Programs
$1,991,020,798
429,684
$4,634
Conservation Reserve Program
$1,807,458,649
397,707
$4,545
Environmental Quality Incentives
Program
$118,268,708
23,585
$5,015
Emergency Conservation Program
$38,610,984
13,580
$2,843
Wetlands Reserve Program
$17,238,484
678
$25,425
Miscellaneous Conservation Payments
$8,811,436
1,839
$4,791
Agricultural Conservation Program
$631,544
175
$3,609
Disaster Programs
$1,327,570,716
469,165
$2,830
Crop Disaster Payments
$1,324,095,908
469,068
$2,823
Karnal Bunt Programs
$3,044,719
241
$12,634
Livestock Disaster / Emergency
$431,298
182
$2,370
Tree Assistance Programs
-$216
1
-$216
Source: Environmental Working Group, Farm Subsidy Database, United States: Subsidy Summary,
Subsidy Detail, [http://www.ewg.org:16080/farm/regiondetail.php?fips=00000&summlevel=2].
Note: There is overlap of recipients across programs. For example, nearly all recipients of loan
deficiency payments also were recipients of production flexibility contract payments. Similarly, many
of the recipients of conservation reserve program payments also were recipients of production
flexibility contract payments. On average, each individual recipient of farm subsidies received
payments related to 1.71 separate programs.
Negative numbers represent reimbursements from farmers for excessive or disqualified payments.

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CRS-6
It often is more helpful to examine commodity support payments by commodity
rather than program. Farmers individually tend to specialize in certain commodities
and this relates to the climate and soil conditions favored by the different
commodities. In the absence of irrigation, corn and soybeans grow especially well
in Iowa, Illinois, and surrounding states. Irrigation has made Texas and California
leading cotton states, but production remains large in Mississippi, Georgia, and
Arkansas. Rice, also, is a southern crop, with Arkansas the leading producer, while
irrigation has moved California into second place. Wheat tolerates low rainfall and
low humidity, and so is produced primarily in North Dakota, Kansas, Montana,
Oklahoma, and Washington. Georgia dominates peanut production, but Texas is
second with large irrigated acreage. Table 2 presents the commodity support data
by commodity.
Table 2. Commodity Subsidy Payments, by Commodity, 2002
Number of
Payment Per
Commodity
Total Payments
Recipients
Recipient
Total Commodity
Subsidies
$8,831,971,671
1,319,110
$6,695
Corn
$1,981,564,489
858,077
$2,309
Cotton
$1,669,746,908
127,582
$13,088
Peanuts
$1,092,846,187
63,139
$17,309
Rice
$1,073,167,886
34,888
$30,760
Wheat
$975,272,805
750,825
$1,299
Dairy
$848,347,339
71,976
$11,787
Soybeans
$670,801,852
250,622
$2,677
Sorghum
$188,981,974
312,031
$606
Barley
$82,801,044
182,657
$453
Apples
$74,334,966
6,469
$11,491
Sugar
$44,288,049
5,109
$8,669
Sheep meat
$32,401,797
17,210
$1,883
Sunflower seed
$6,518,597
5,910
$1,103
Oats
$6,226,386
345,197
$18
Tobacco
$4,990,960
17,623
$283
Safflower seed
$1,885,304
1,037
$1,818
Source: Environmental Working Group, Farm Subsidy Database, United States Summary, 2002
[http://www.ewg.org/farm/region.php?fips=00000&progcode=total&yr=2002]
Note: There is overlap of recipients across commodities. For example, many recipients of corn
subsidies also were recipients of soybean subsidies.

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CRS-7
State-By-State Distribution of
Total Farm Subsidy Payments
Figure 3 and Table 3 show the geographic distribution of $12.151 billion in
total subsidy payments. Predictably, the farm states in the agricultural heartland of
the country from the Canadian border to the Gulf of Mexico received most of the
subsidy payments. The state receiving the largest amount was Texas, with nearly
$1.209 billion, followed by Iowa, Georgia, Arkansas, California, Illinois, and
Nebraska, each receiving over $500 million.
There were 2.129 million farms in the United States in 2002 according to the
2002 Census of Agriculture, which defines a farm as producing and selling $1,000
or more in agricultural products. The state with the largest number of farms was
Texas (about 229,000), followed by Missouri (about 107,000). Not all farms in the
nation received subsidy payments. Eligibility is linked to the production of certain
commodities or to the adoption of certain conservation practices.
Commodities that received mandatory federal price and income support
payments included wheat, corn, sorghum, barley, oats, rice, cotton, soybeans,
sunflower seed, rapeseed, canola, safflower, flaxseed, mustard seed, crambe, sesame
seed, peanuts, dry peas, lentils, small chickpeas, milk, sugar, wool, mohair, honey,
and tobacco. Major categories of commodities are not supported, including fruits,
vegetables, tree nuts, livestock meat, greenhouse and nursery crops, and hay and
forage crops. Farm cash receipts from sales of supported commodities amounted to
about $53 billion in 2002, or 28% of the $193 billion in national total commodity
cash receipts in 2002.8 Some commodities not receiving mandatory support received
disaster assistance and ad hoc market loss assistance payments in 2002.
8 Calculated from USDA, Economic Research Service, data on farm cash receipts.

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CRS-8
Figure 3. Total Farm Subsidy Payments in 2002
Million $
$0-$100M
$101-$400M
$400M-$1,200M
Based on Environmental Working Group, Farm Subsidy Database.
Farm subsidy payments in 2002 totaled $12.151 billion, of which:
! Commodity support payments totaled $8.832 billion, including:
— Corn, $1.982 billion
— Cotton, $1.670 billion
— Peanuts, $1.092 billion
— Rice, $1.073 billion
— Wheat, $0.975 billion
— Soybeans, $0.671 billion
! Conservation payments totaled $1.991 billion, including:
— Conservation Reserve Program payments of $1.807
! Disaster payments totaled $1.328 billion.
The top 11 states received $6.844 billion in farm subsidy payments (56.3% of
the U.S. total):
! Texas, $1,209 million (9.9%)
! Iowa, $740 million (6.1%)
! Georgia, $661 million (5.4%)
! Arkansas, $660 million (5.4%)
! California, $652 million (5.4%)
! Illinois, $615 million (5.1%)
! Nebraska, $539 million (4.4%)
! Minnesota, $468 million (3.8%)
! Kansas, $457 million (3.8%)
! Mississippi, $438 million (3.6%)
! Missouri, $406 million (3.3%)

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CRS-9
Table 3. Subsidy Payments to Farm Operators and Landlords,
by State, 2002
Rank
State
Payments to
Payments to
Total Payments
Operators
Landlords
Share of
Share of
Share of
Total
Total
US Total
(million $)
(%)
(million $)
(%)
(million $)
(%)
All States
$6,545.7
54%
$5,604.9
46% $12,150.6 100.0%
1
Texas
$529.0
44%
$680.0
56%
$1,208.9
9.9%
2
Iowa
$538.9
73%
$201.1
27%
$740.0
6.1%
3
Georgia
$118.5
18%
$542.1
82%
$660.7
5.4%
4
Arkansas
$238.6
36%
$421.3
64%
$659.9
5.4%
5
California
$168.7
26%
$483.4
74%
$652.1
5.4%
6
Illinois
$412.6
67%
$202.5
33%
$615.1
5.1%
7
Nebraska
$347.5
64%
$191.7
36%
$539.2
4.4%
8
Minnesota
$350.7
75%
$116.8
25%
$467.5
3.8%
9
Kansas
$328.2
72%
$128.6
28%
$456.8
3.8%
10 Mississippi
$145.5
33%
$292.3
67%
$437.8
3.6%
11 Missouri
$264.5
65%
$141.4
35%
$405.9
3.3%
12 North Dakota
$293.1
76%
$90.6
24%
$383.6
3.2%
13 Indiana
$224.7
67%
$110.2
33%
$334.9
2.8%
14 South Dakota
$215.1
64%
$119.5
36%
$334.6
2.8%
15 Wisconsin
$247.9
75%
$84.5
25%
$332.4
2.7%
16 North Carolina
$97.7
30%
$226.2
70%
$323.9
2.7%
17 Oklahoma
$149.9
47%
$167.3
53%
$317.2
2.6%
18 Alabama
$77.9
27%
$211.3
73%
$289.2
2.4%
19 Ohio
$197.4
70%
$83.6
30%
$281.0
2.3%
20 Louisiana
$123.6
47%
$139.1
53%
$262.7
2.2%
21 Montana
$210.7
80%
$51.2
20%
$261.9
2.2%
22 Washington
$133.8
62%
$82.0
38%
$215.7
1.8%
23 Colorado
$125.8
60%
$85.0
40%
$210.8
1.7%
24 Michigan
$144.8
76%
$45.9
24%
$190.7
1.6%
25 Virginia
$54.7
30%
$127.3
70%
$181.9
1.5%
26 Idaho
$93.9
57%
$71.5
43%
$165.4
1.4%
27 New York
$110.2
69%
$49.1
31%
$159.4
1.3%
28 Tennessee
$59.2
41%
$86.5
59%
$145.7
1.2%
29 Kentucky
$94.1
68%
$44.2
32%
$138.3
1.1%
30 Pennsylvania
$85.8
66%
$44.4
34%
$130.2
1.1%
31 Florida
$21.8
26%
$61.1
74%
$82.9
0.7%
32 Oregon
$52.1
65%
$28.1
35%
$80.2
0.7%
33 New Mexico
$50.2
68%
$24.1
32%
$74.3
0.6%
34 Arizona
$31.8
45%
$38.5
55%
$70.2
0.6%
35 Wyoming
$37.9
57%
$28.2
43%
$66.1
0.5%
36 South Carolina
$38.4
59%
$27.0
41%
$65.4
0.5%

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CRS-10
Rank
State
Payments to
Payments to
Total Payments
Operators
Landlords
Share of
Share of
Share of
Total
Total
US Total
(million $)
(%)
(million $)
(%)
(million $)
(%)
37 Utah
$26.7
49%
$27.6
51%
$54.3
0.4%
38 Maryland
$33.1
68%
$15.8
32%
$49.0
0.4%
39 Vermont
$24.4
67%
$12.1
33%
$36.4
0.3%
40 Maine
$8.7
63%
$5.1
37%
$13.7
0.1%
41 Delaware
$8.6
72%
$3.3
28%
$11.9
0.1%
42 Nevada
$4.3
38%
$7.1
62%
$11.4
0.1%
43 New Jersey
$4.4
69%
$2.0
31%
$6.5
0.1%
44 Massachusetts
$4.3
70%
$1.8
30%
$6.1
0.0%
45 West Virginia
$5.2
91%
$0.5
9%
$5.7
0.0%
46 Connecticut
$3.7
74%
$1.3
26%
$4.9
0.0%
47 New Hampshire
$3.8
103%
-$0.1
-3%
$3.7
0.0%
48 Hawaii
$0.9
46%
$1.0
54%
$1.9
0.0%
49 Alaska
$1.8
99%
$0.0
1%
$1.8
0.0%
50 Rhode Island
$0.5
81%
$0.1
19%
$0.7
0.0%
Source: Data on subsidy payments to farm operators are based on payments to farms reported in the
2002 Census of Agriculture. Data on total subsidy payments are from the Environmental Working
Group, Farm Subsidy Database. Payments to non-operator recipients are calculated as the difference
between total payments and payments to operators.

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CRS-11
Farms Receiving Subsidy Payments
Of the nation’s 2.1 million farms, 707,596 (33%) received subsidy payments
and 1,421,386 (67%) did not receive payments in 2002. Figure 4 and Table 4 show
the percentage of farms in each state that received payments in 2002. In North
Dakota, 78% of farms received subsidy payments, followed by Iowa, Illinois,
Nebraska, South Dakota, Kansas, and Minnesota, each with payments going to more
than half the farms in the state. This concentration reflects the specialization of
farms in these states in the production of subsidized feed grains, oilseeds, and wheat.
Generally the other states proportionally have more livestock and specialty crops that
do not receive price support.

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CRS-12
Figure 4. Percentage of Farms Receiving Subsidies in 2002
Percent of All Farms
0%-19%
20%-49%
50%-78%
Based on data from USDA, 2002 Census of Agriculture
Nationally, 33% of farms received subsidies (707,596 farms out of 2,128,982).
More than 50% of the farms in each of seven states received subsidies in 2002.
This proportion of subsidized farms reflects highly concentrated production of wheat,
corn, and/or soybeans by most farms in these state. These states were:
! North Dakota (78%)
! Iowa (70%)
! Illinois (66%)
! Nebraska (65%)
! South Dakota (64%)
! Kansas (61%)
! Minnesota (54%)

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CRS-13
Table 4. Proportion of Farms Receiving Subsidy Payments,
by State, 2002
Farms w/
Share of Farms
Rank
State
All Farms
Subsidies
w/ Subsidies (%)
All States
2,128,982
707,596
33%
1
North Dakota
30,619
23,892
78%
2
Iowa
90,655
63,074
70%
3
Illinois
73,027
47,857
66%
4
Nebraska
49,355
32,007
65%
5
South Dakota
31,736
20,259
64%
6
Kansas
64,414
39,191
61%
7
Minnesota
80,839
43,927
54%
8
Wisconsin
77,131
37,234
48%
9
Indiana
60,296
26,841
45%
10
Montana
27,870
12,389
44%
11
Missouri
106,797
43,379
41%
12
Ohio
77,797
28,851
37%
13
Michigan
53,315
18,133
34%
14
Wyoming
9,422
3,163
34%
15
Colorado
31,369
10,163
32%
16
Georgia
49,311
15,510
31%
17
Mississippi
42,186
12,383
29%
18
Oklahoma
83,300
24,316
29%
19
Alabama
45,126
12,863
29%
20
Idaho
25,017
7,098
28%
21
Maryland
12,198
3,372
28%
22
Louisiana
27,413
7,562
28%
23
New York
37,255
9,896
27%
24
Kentucky
86,541
22,825
26%
25
Delaware
2,391
617
26%
26
South Carolina
24,541
6,112
25%
27
North Carolina
53,930
12,312
23%
28
New Mexico
15,170
3,246
21%
29
Pennsylvania
58,105
11,991
21%
30
Washington
35,939
7,332
20%
31
Vermont
6,571
1,296
20%
32
Utah
15,282
2,987
20%
33
Virginia
47,606
9,206
19%
34
Texas
228,926
42,217
18%
35
Tennessee
87,595
16,034
18%
36
Maine
7,196
1,244
17%
37
Arkansas
47,483
7,811
16%
38
Nevada
2,989
439
15%
39
Alaska
609
72
12%
40
Arizona
7,294
833
11%
41
Oregon
40,033
4,430
11%
42
New Hampshire
3,363
359
11%
43
California
79,631
7,228
9%
44
West Virginia
20,812
1,675
8%

---

CRS-14
Farms w/
Share of Farms
Rank
State
All Farms
Subsidies
w/ Subsidies (%)
45
Massachusetts
6,075
415
7%
46
Connecticut
4,191
254
6%
47
Rhode Island
858
52
6%
48
New Jersey
9,924
582
6%
49
Florida
44,081
2,554
6%
50
Hawaii
5,398
113
2%
Source: Data on farms and farms receiving subsidies are from the 2002 Census of Agriculture.

---

CRS-15
Subsidy Payments per Farm
Total subsidy payments of $12.151 billion divided among 707,596 recipient
farms is equal to $17,172 per farm. However, the average by state ranges from
$90,214 per farm in California to $3,401 in West Virginia (see Figure 5 and Table
5). Generally, the states with the largest per-farm payments are those that produce
rice and cotton. Other states receiving the larger per-farm payments in 2002
benefitted from peanut quota buyout payments, disaster payments, and apple market
loss assistance payments.
While each farm has an operator, there may be other individuals associated with
the farm who are eligible to receive subsidy payments. Generally, individuals must
be actively engaged in the farming operation to receive subsidy payments. Actively
engaged means providing a significant contribution of capital, land, or equipment,
as well as a significant contribution of personal labor or active personal management
to the operation. This personal contribution of labor or management must be in
proportion to the share of the farm’s profits and losses and it must be at risk. A
landlord receiving crop share rent is likely considered actively engaged while a
landlord receiving cash rent is not actively engaged.9
9 The interpretation and application of the legal requirement concerning the phrase “actively
engaged” was examined in General Accounting Office testimony titled Farm Program
Payments: USDA Should Correct Weaknesses in Regulations and Oversight to Better
Ensure Recipients Do Not Circumvent Payment Limitations before the Senate Committee
on Finance on June 16, 2004 (GAO-04-861T).

---

CRS-16
Figure 5. Average Subsidy Payment per Farm in 2002
$ per F ar m
$ 3 K-$ 15K
$1 5K -$3 0K
$3 0K-$9 0K
Source: Based on data from USDA, 2002 Census of Agriculture, and Environmental Working
Group, Farm Subsidy Database.
Subsidy payments per farm (among only the farms receiving subsidies) averaged
$17,172 in 2002.
The highest per-farm payments were made in California, Arkansas, and Arizona.
! California ($90,214 per farm) is notable for large rice, cotton, and
dairy farms dominating the farm subsidy payments.
! Arkansas ($84,480 per farm) is the leading rice state, with many of
the rice farms being large. Also, rice cooperatives in Arkansas may
be the initial recipient of payments that are subsequently distributed
among member farms.
! Arizona ($84,329 per farm) is notable for payments to a few, but
large, cotton, dairy, and peanut farms.
! Large per-farm payments in Georgia and Florida reflect peanut quota
buyout payments that were unique to 2002.
! Large per-farm payments in Mississippi reflect payments for
peanuts, rice, cotton, and milk.
! Large per-farm payments in Louisiana reflect payments for rice,
cotton, and milk.

---

CRS-17
Table 5. Total Subsidy Payments Per Farm,
by State, 2002
Subsidy Per
Farms w/
Total Payments
Recipient Farm
Rank
State
Subsidies
(thousand $)
(average)
All States
707,596
$12,150,563
$17,172
1
California
7,228
$652,065
$90,214
2
Arkansas
7,811
$659,871
$84,480
3
Arizona
833
$70,246
$84,329
4
Georgia
15,510
$660,662
$42,596
5
Mississippi
12,383
$437,762
$35,352
6
Louisiana
7,562
$262,702
$34,740
7
Florida
2,554
$82,881
$32,451
8
Washington
7,332
$215,736
$29,424
9
Texas
42,217
$1,208,944
$28,636
10
Vermont
1,296
$36,441
$28,118
11
North Carolina
12,312
$323,911
$26,309
12
Nevada
439
$11,378
$25,918
13
Alaska
72
$1,783
$24,766
14
Idaho
7,098
$165,428
$23,306
15
New Mexico
3,246
$74,323
$22,897
16
Alabama
12,863
$289,183
$22,482
17
Montana
12,389
$261,945
$21,143
18
Wyoming
3,163
$66,085
$20,893
19
Colorado
10,163
$210,758
$20,738
20
Virginia
9,206
$181,928
$19,762
21
Connecticut
254
$4,946
$19,472
22
Delaware
617
$11,939
$19,350
23
Utah
2,987
$54,304
$18,180
24
Oregon
4,430
$80,177
$18,099
25
Hawaii
113
$1,911
$16,911
26
Nebraska
32,007
$539,214
$16,847
27
South Dakota
20,259
$334,633
$16,518
28
New York
9,896
$159,377
$16,105
29
North Dakota
23,892
$383,645
$16,057
30
Massachusetts
415
$6,070
$14,627
31
Maryland
3,372
$48,953
$14,517
32
Oklahoma
24,316
$317,194
$13,045
33
Illinois
47,857
$615,111
$12,853
34
Rhode Island
52
$651
$12,519
35
Indiana
26,841
$334,917
$12,478
36
Iowa
63,074
$739,968
$11,732
37
Kansas
39,191
$456,829
$11,656
38
New Jersey
582
$6,476
$11,127
39
Maine
1,244
$13,745
$11,049
40
Pennsylvania
11,991
$130,179
$10,856
41
South Carolina
6,112
$65,358
$10,693
42
Minnesota
43,927
$467,542
$10,644
43
Michigan
18,133
$190,686
$10,516

---

CRS-18
Subsidy Per
Farms w/
Total Payments
Recipient Farm
Rank
State
Subsidies
(thousand $)
(average)
44
New Hampshire
359
$3,701
$10,308
45
Ohio
28,851
$281,031
$9,741
46
Missouri
43,379
$405,873
$9,356
47
Tennessee
16,034
$145,723
$9,088
48
Wisconsin
37,234
$332,425
$8,928
49
Kentucky
22,825
$138,257
$6,057
50
West Virginia
1,675
$5,696
$3,401
Source: Data on the number of farms receiving subsidies are from the 2002 Census of Agriculture.
Data on total subsidy payments are from the Environmental Working Group, Farm Subsidy Database.

---

CRS-19
Subsidy Payments to Farm Operators and Landlords
There were 1,705,514 separate recipients of farm subsidy payments in 2002,
associated with 707,596 farms. In nearly all cases, the recipients were individual
farm operators and non-operator landlords. However, in some cases the recipients
were legal business entities, such as partnerships, corporations, cooperatives, and
trusts involving more than one individual. In the terminology of the law each of the
farm operators, landlords, or other legal entities is called a “person” and is subject to
limits on the size of payments from subsidy programs.10
A simplifying assumption is made for purposes of this analysis that each of the
707,596 farms receiving subsidy payments has a single operator. It is further
assumed the difference between the 707,596 farm operators and the 1,705,514 total
subsidy recipients (equaling 997,918) are farm landlords.11 For the most part, these
997,918 landlords are the owners of farmland that is rented to operators. Often, the
landlords are relatives of farm operators and neighboring landowners who have left
farming. It is typical for farmland to be owned collectively by the children of a
former farm family, none of whom remains in farming but who continue to retain
ownership of their former family farm.
Given the aforementioned assumption, Figure 6 and Table 6 show the
proportion of landlords to farm operators in each state. On average there were 1.41
landlords receiving subsidy payments for every farm operator who received
payments. However, there was a range among states from 4.05 landlords per
operator in Arizona down to 0.44 in Alaska. Differences between states in the ratio
of farm operators to landlords reflect differing commodity specializations, regional
approaches to farm consolidation, and regional attitudes toward farmland ownership.
Also, annual per-person payment limits create an incentive to add actively engaged
landlords rather than expand the acreage owned by the farm operator.
The national average farm subsidy payment to each farm operator in 2002 was
$9,251, and the average subsidy to each non-operator recipient was $5,617. Since
there were 1.41 off-farm landlords for each farm, the average subsidy per farm to off-
farm landlords was $7,921 (86% of the amount paid to each operator). Table 7
shows the distribution payments to farm operators and Table 8 shows the distribution
of payments to off-farm landlords.
10 See CRS Report RS21779, Grains, Cotton, Oilseeds, and Peanuts: Payments Under the
2002 Farm Bill, for more information on per-person payment limits related to commodity
support programs.
11 To be eligible for commodity payments, a person must be actively engaged in farming.
This can be achieved by providing a significant contribution of capital, land, or equipment,
as well as a significant contribution of personal labor or active personal management to the
operation. Few people qualify for commodity payments who are not operators or landlords.

---

CRS-20
Figure 6. Average Number of Landlords per Farm
Receiving Subsidies in 2002
La ndlor ds pe r Far m
0. 4- 1.2
1 .3- 2.2
2.3- 4. 1
Source: Based on data from USDA, 2002 Census of Agriculture, and Environmental Working
Group, Farm Subsidy Database.
The national average number of landlords (non-operator recipients) per farm
that received subsidies in 2002 was 1.41.
! Arizona (4.1) and Louisiana (3.2) had the largest number of
landlords per farm that received subsidies.
! In the northeast and along the northern border of the country there
were more full owner-operators. These states fell below the national
average of 1.41 landlord per farm.

---

CRS-21
Table 6. Subsidy Recipients Per Farm, by State, 2002
Landlord
All
Operator
Landlord
Recipients
Rank
State
Recipients
Recipients
Recipients
Per Farm
All States
1,705,514
707,596
997,918
1.41
1
Arizona
4,209
833
3,376
4.05
2
Louisiana
31,889
7,562
24,327
3.22
3
North Carolina
46,599
12,312
34,287
2.78
4
Arkansas
28,758
7,811
20,947
2.68
5
Florida
8,340
2,554
5,786
2.27
6
Kentucky
74,083
22,825
51,258
2.25
7
Tennessee
51,298
16,034
35,264
2.20
8
Alabama
40,477
12,863
27,614
2.15
9
Georgia
46,951
15,510
31,441
2.03
10 Nevada
1,257
439
818
1.86
11 Kansas
111,751
39,191
72,560
1.85
12 Illinois
134,870
47,857
87,013
1.82
13 Virginia
25,375
9,206
16,169
1.76
14 New Mexico
8,916
3,246
5,670
1.75
15 California
19,780
7,228
12,552
1.74
16 Colorado
27,164
10,163
17,001
1.67
17 Indiana
71,615
26,841
44,774
1.67
18 Texas
111,512
42,217
69,295
1.64
19 South Carolina
16,134
6,112
10,022
1.64
20 Idaho
18,505
7,098
11,407
1.61
21 Oklahoma
63,183
24,316
38,867
1.60
22 Washington
18,650
7,332
11,318
1.54
23 Nebraska
78,240
32,007
46,233
1.44
24 Mississippi
29,444
12,383
17,061
1.38
25 Utah
7,063
2,987
4,076
1.36
26 Oregon
10,474
4,430
6,044
1.36
27 Delaware
1,436
617
819
1.33
28 Wyoming
7,360
3,163
4,197
1.33
29 Hawaii
253
113
140
1.24
30 Ohio
64,311
28,851
35,460
1.23
31 Montana
27,591
12,389
15,202
1.23
32 South Dakota
44,982
20,259
24,723
1.22
33 Massachusetts
909
415
494
1.19
34 Missouri
94,784
43,379
51,405
1.19
35 Vermont
2,821
1,296
1,525
1.18
36 Michigan
38,093
18,133
19,960
1.10
37 North Dakota
49,089
23,892
25,197
1.05
38 Maine
2,533
1,244
1,289
1.04
39 Rhode Island
105
52
53
1.02
40 West Virginia
3,297
1,675
1,622
0.97
41 Connecticut
494
254
240
0.94
42 New Jersey
1,129
582
547
0.94
43 Maryland
6,510
3,372
3,138
0.93
44 Iowa
119,308
63,074
56,234
0.89

---

CRS-22
Landlord
All
Operator
Landlord
Recipients
Rank
State
Recipients
Recipients
Recipients
Per Farm
45 New Hampshire
643
359
284
0.79
46 New York
17,087
9,896
7,191
0.73
47 Minnesota
75,310
43,927
31,383
0.71
48 Wisconsin
63,345
37,234
26,111
0.70
49 Pennsylvania
19,992
11,991
8,001
0.67
50 Alaska
104
72
32
0.44
Source: Data on the number of subsidy recipients are from the Environmental Working Group, Farm
Subsidy Database. The data on the number of farm operators receiving subsidies are assumed to equal
the number of farms receiving subsidies, which are from the 2002 Census of Agriculture.

---

CRS-23
Table 7. Average Subsidy Payments to Farm Operators,
by State, 2002
Rank
State
Operator
Payments to Operators
Recipients
Total $ (thousand)
$ Per Operator
All States
707,596
$6,545,678
$9,251
1
Arizona
833
$31,760
$38,127
2
Arkansas
7,811
$238,577
$30,544
3
Alaska
72
$1,765
$24,514
4
California
7,228
$168,698
$23,340
5
Vermont
1,296
$24,377
$18,809
6
Washington
7,332
$133,763
$18,244
7
Montana
12,389
$210,749
$17,011
8
Louisiana
7,562
$123,599
$16,345
9
New Mexico
3,246
$50,201
$15,465
10
Connecticut
254
$3,681
$14,492
11
Delaware
617
$8,643
$14,008
12
Idaho
7,098
$93,934
$13,234
13
Texas
42,217
$528,979
$12,530
14
Colorado
10,163
$125,774
$12,376
15
North Dakota
23,892
$293,067
$12,266
16
Wyoming
3,163
$37,913
$11,986
17
Oregon
4,430
$52,085
$11,757
18
Mississippi
12,383
$145,508
$11,751
19
New York
9,896
$110,234
$11,139
20
Nebraska
32,007
$347,517
$10,858
21
New Hampshire
359
$3,823
$10,649
22
South Dakota
20,259
$215,084
$10,617
23
Massachusetts
415
$4,268
$10,284
24
Rhode Island
52
$528
$10,154
25
Nevada
439
$4,322
$9,845
26
Maryland
3,372
$33,131
$9,825
27
Utah
2,987
$26,669
$8,928
28
Illinois
47,857
$412,636
$8,622
29
Iowa
63,074
$538,896
$8,544
30
Florida
2,554
$21,818
$8,543
31
Kansas
39,191
$328,244
$8,375
32
Indiana
26,841
$224,701
$8,372
33
Minnesota
43,927
$350,709
$7,984
34
Michigan
18,133
$144,771
$7,984
35
North Carolina
12,312
$97,696
$7,935
36
Hawaii
113
$886
$7,841
37
Georgia
15,510
$118,535
$7,642
38
New Jersey
582
$4,441
$7,631
39
Pennsylvania
11,991
$85,794
$7,155
40
Maine
1,244
$8,664
$6,965
41
Ohio
28,851
$197,425
$6,843
42
Wisconsin
37,234
$247,942
$6,659

---

CRS-24
Rank
State
Operator
Payments to Operators
Recipients
Total $ (thousand)
$ Per Operator
43
South Carolina
6,112
$38,384
$6,280
44
Oklahoma
24,316
$149,942
$6,166
45
Missouri
43,379
$264,475
$6,097
46
Alabama
12,863
$77,930
$6,058
47
Virginia
9,206
$54,677
$5,939
48
Kentucky
22,825
$94,053
$4,121
49
Tennessee
16,034
$59,231
$3,694
50
West Virginia
1,675
$5,180
$3,093
Source: Operator recipients are assumed to match data on farms receiving subsidies as reported by
the 2002 Census of Agriculture.

---

CRS-25
Table 8. Average Subsidy Payments to Landlords,
by State, 2002
Rank
State
Landlord
Payments to Landlords
Recipients
Total $
$ Per Landlord
(thousand)
All States
997,918
$5,604,885
$5,617
1
California
12,552
$483,367
$38,509
2
Arkansas
20,947
$421,294
$20,112
3
Georgia
31,441
$542,127
$17,243
4
Mississippi
17,061
$292,254
$17,130
5
Arizona
3,376
$38,486
$11,400
6
Florida
5,786
$61,063
$10,553
7
Texas
69,295
$679,965
$9,813
8
Nevada
818
$7,056
$8,626
9
Vermont
1,525
$12,064
$7,911
10
Virginia
16,169
$127,251
$7,870
11
Alabama
27,614
$211,253
$7,650
12
Hawaii
140
$1,025
$7,321
13
Washington
11,318
$81,973
$7,243
14
New York
7,191
$49,143
$6,834
15
Utah
4,076
$27,635
$6,780
16
Wyoming
4,197
$28,172
$6,712
17
North Carolina
34,287
$226,215
$6,598
18
Idaho
11,407
$71,494
$6,268
19
Louisiana
24,327
$139,103
$5,718
20
Pennsylvania
8,001
$44,385
$5,547
21
Connecticut
240
$1,265
$5,270
22
Maryland
3,138
$15,822
$5,042
23
Colorado
17,001
$84,984
$4,999
24
South Dakota
24,723
$119,549
$4,836
25
Oregon
6,044
$28,092
$4,648
26
Oklahoma
38,867
$167,252
$4,303
27
New Mexico
5,670
$24,122
$4,254
28
Nebraska
46,233
$191,697
$4,146
29
Delaware
819
$3,296
$4,025
30
Maine
1,289
$5,081
$3,942
31
Minnesota
31,383
$116,833
$3,723
32
New Jersey
547
$2,035
$3,720
33
Massachusetts
494
$1,802
$3,648
34
North Dakota
25,197
$90,578
$3,595
35
Iowa
56,234
$201,072
$3,576
36
Montana
15,202
$51,196
$3,368
37
Wisconsin
26,111
$84,483
$3,236
38
Missouri
51,405
$141,398
$2,751
39
South Carolina
10,022
$26,974
$2,691
40
Indiana
44,774
$110,216
$2,462
41
Tennessee
35,264
$86,492
$2,453

---

CRS-26
Rank
State
Landlord
Payments to Landlords
Recipients
Total $
$ Per Landlord
(thousand)
42
Ohio
35,460
$83,606
$2,358
43
Illinois
87,013
$202,475
$2,327
44
Rhode Island
53
$123
$2,321
45
Michigan
19,960
$45,915
$2,300
46
Kansas
72,560
$128,585
$1,772
47
Kentucky
51,258
$44,204
$862
48
Alaska
32
$18
$568
49
West Virginia
1,622
$516
$318
50
New Hampshire
284
-$122
-$431
Source: Data in this table are tabulated from 2002 Census of Agriculture and Environmental Working
Group, Farm Subsidy Database, data shown elsewhere in this report.

---

CRS-27
Concentration of Farm Subsidy Payments
Data on average payment per farm operator and the average payment per
landlord mask the fact that payments were concentrated among a comparatively small
proportion of the recipients. Table 9 shows that 85,358 top recipients (5% of all
recipients) received 50% of all payments for an average of $70,523 per recipient.
Included in the very top recipients are a number of cooperatives, corporations, and
trusts that divided the payments among several and sometimes numerous farmers.
In addition, several individuals received multi-million dollar payments, particularly
in conjunction with the peanut quota buyout.
Table 9. Farm Subsidy Payments Reach a Large Number of
Recipients, But Most of the Money Goes to a Few
% of All
% of
Number of
Total Subsidy
Average Payment
Recipients
Payments
Recipients
Payments
Per Recipient
Top 5%
50%
85,358
$6,019,739,668
$70,523
Next 5%
15%
85,359
$1,865,686,784
$21,857
Next 10%
16%
170,718
$1,970,454,705
$11,542
Remaining 80%
19%
1,365,741
$2,294,682,028
$1,680
All Recipients
100%
1,705,514
$12,150,563,185
$7,124
Source: Environmental Working Group, Farm Subsidy Database.

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