The U.S. government will trim payments to 350,000 farmers by about $152 million to comply with automatic spending cuts that took effect at the start of this month, Agriculture Secretary Tom Vilsack said on Tuesday.
According to Reuters, Vilsack said the money would come out of the $5 billion-a-year direct-payment subsidy, which is paid in the fall, to offset reductions due in three USDA programs that have already disbursed money to farmers.
During a speech to trade group officials, Vilsack said comparatively small amounts are due for each farmer, so it would be more efficient to pro-rate the direct-payment subsidy than to ask the farmers for a refund on checks already cut.
Affected are the Milk Income Loss Contract subsidy to dairy farmers, the Supplemental Revenue Assistance program and the Noninsured Assistance Program.
SURE and NAP are insurance-like programs that cover losses due to bad weather.