Noninsured Crop Disaster Assistance Program

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Program level Payment Integrity results

Sponsoring agency: Department of Agriculture

View on Federal Program Inventory

PROGRAM METRICS

$79 M

in FY 2021 outlays, with a

87.7%

payment accuracy rate

PROGRAM METRICS

$178 M

in FY 2022 outlays, with a

90.5%

payment accuracy rate

PROGRAM METRICS

$240 M

in FY 2023 outlays, with a

89.5%

payment accuracy rate

PROGRAM METRICS

$315 M

in FY 2024 outlays, with a

88.4%

payment accuracy rate

PROGRAM METRICS

$186 M

in FY 2025 outlays, with a

89.4%

payment accuracy rate

  • Improper payment estimates over time
    View as:

    Chart toggle amounts:
    Proper payments
    Overpayment
    Underpayment
    Technically improper
    Unknown

Payment Integrity results

  • FY 2021 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    10/2019 - 09/2020


    Confidence interval:

    >90%


    Margin of error:

    +/-3.0

Overpayments

Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $1.99 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $1.99 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0.0 M

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $0.58 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $0.58 M

Technically improper payments

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $7.19 M

Additional information

$7.77 M

Unknown Payment Details

Evaluation of corrective actions

Future payment integrity outlook

Noninsured Crop Disaster Assistance Program has established a baseline.

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $165 M
Current year +1 estimated future improper payments $16.48 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 9.99 %

The program's current year improper payment and unknown payment rate of 12.3 % has not been achieved with a balance of payment integrity risk and controls and does not represent the lowest rate that can be achieved without disproportionally increasing another risk, therefore it is not the tolerable rate.

Additional programmatic information

  • FY 2022 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    10/2020 - 09/2021


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.0

Overpayments

In preventing or reducing improper payments in program, the agency has implemented the following measures: Communications have increased by establishing monthly teleconferences with State Offices with the purpose of focusing on program deficiencies for improving improper payment percentages, providing policy updates and ad-hoc trainings. These trainings are posted on the Agency’s Deputy Administrator for Farm Programs internal training website and available to all Farm Service Agency employees. An Acreage reporting review is currently underway for fiscal year 2022 to help determine the root cause(s) for administrative errors, including late-filed deficiencies. Farm Service Agency plans to utilize the review results to establish strategies that will improve program processes and establish accountability measures for the remainder of fiscal year 2022 and for fiscal year 2023. A series of targeted data mining and spot-checking activities will be performed and utilized to determine root causes of deficiencies related to fiscal year 2022 Payment Integrity Information Act program findings. Farm Service Agency will utilize the results to develop a mitigation strategy to address policy oversight and administrative errors, as well as, the establishment of accountability measures. Refresher trainings will be developed to specifically address common fiscal year 2022 Payment Integrity Information Act findings across programs, to include agency representative approval procedures, acceptable producer and affiliate filing requirements, as well as County Office Committee redelegations of authority for approval of documents. Safety Net Division is requesting workload assistance in the form of a software task force to assist software specialists in developing and implementing software enhancements, to include validation processes, as well as updating software procedure to reduce findings.
Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $6.4 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $6.4 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0.0 M

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $0.03 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $0.03 M

Technically improper payments

The county offices did not follow statutory requirements related to incorrect acreage and production reporting.
The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $10.41 M

Additional information

$10.44 M

Unknown Payment Details

Evaluation of corrective actions

Noninsured Crop Disaster Assistance Program’s historical top errors are related to acreage reporting and production records. The errors typically occur when county office employees fail to access data, fail to enter data, or enter it incorrectly, such as data from the National Crop Table, or data entered on CCC-576 (Appraisal and Production form). The agency's Safety Net Division has addressed these errors through training, such as National training in Phoenix (August 2019), and Noninsured Crop Disaster Assistance Program's monthly calls with State office program specialists. These trainings are posted on Deputy Administrator for Farm Programs' internal training page and available to all Farm Service Agency employees. As a result, the programs improper payment error rate has decreased the past four consecutive years and is now below ten percent.

Future payment integrity outlook

Noninsured Crop Disaster Assistance Program has NOT established a baseline.

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $300 M
Current year +1 estimated future improper payments $27 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 9.0 %

The program's current year improper payment and unknown payment rate of 9.47 % has been achieved with a balance of payment integrity risk and controls and represents the lowest rate that can be achieved without disproportionally increasing another risk, therefore it is the tolerable rate.

The program reported an improper payment error rate of 9.47% for the fiscal year 2022 payment integrity review cycle which is below the agency's 10% tolerable rate.

Farm Service Agency continues to strategically take the necessary steps to strengthen internal controls measures, establish uniform consistency for compliance processes, and improve accountability. Farm Service Agency’s aim is to not only make these improvements at the program specific level but to initiate transformation at the overall arching and broader Agency level.

Farm Service Agency will require key resources to continue its progression towards strengthening internal controls and addressing the inconsistencies with certain programs reporting more than the statutory improper payment threshold in fiscal year 2022.

Human Capital Needs: National and State Office Compliance Resources - To resolve the Agency’s noncompliance issues in a timely manner, strengthen program integrity and accountability and maintain an ongoing compliance oversight strategy, additional compliance staff will be crucial for Farm Service Agency to build a comprehensive and robust compliance program.

Farm Service Agency once had staff positions whose main responsibility involved monitoring and addressing compliance related issues within states known as Farm Service Agency County Operations Reviewer, but these positions were transferred in fiscal year 2019 from Farm Service Agency to the Farm Production and Conservation Business Center, Performance, Accountability and Risk Division during the Farm Production and Conservation Business Center reorganization. This transfer caused a hardship on Farm Service Agency’s internal controls program and significant resource and specialized knowledge gaps are still prevalent today, which is contributing to Farm Service Agency’s capacity to timely and adequately address various compliance issues and requirements. Farm Service Agency and Performance, Accountability and Risk Division are evaluating the current set up to seek improvements as it relates to Farm Service Agency program compliance. In addition, Farm Service Agency’s existing staff continues to be stretched with the responsibilities of training new staff, administering Farm Service Agency programs, performing existing County Operations Reviewers duties, and addressing new compliance requirements, all as collateral duties. Farm Service Agency and Performance, Accountability and Risk Division are developing a new work plan to better address this issue and goal by first quarter fiscal year 2023 to define an improved workplan to support compliance review.

Information Systems’ Needs – Farm Service Agency is positioning itself to take preventive measures through automated processes that are built into business systems to reduce errors. Automation improves productivity and enforces procedural compliance; therefore, Farm Service Agency is exploring better approaches to integrate internal controls functions into the implementation of programs, as well as maintenance of an existing program systems. Given these efforts, the Agency is planning to request Congressional funding for enhancing: 1) transactional program systems/software to quickly meet the implementation demands of pandemic, emergency, and disaster programs and 2) interface systems to allow data sharing and eliminate manual/duplicative entries and processes.

Several transactional program systems and software “work arounds” and manual processes still exist that are contributing to the increase of program improper payments. Funding is needed to resolve current deficiencies and build internal controls requirements within these systems.

From an internal controls oversight perspective, Farm Service Agency has invested in the Internal Review Documentation and Tracking System and continues to incorporate manual-paper based program reviews and spot-checks into automated processes within the system. The objectives for Internal Review Documentation and Tracking System are to improve oversight capabilities to State and National program managers, supplement data mining efforts and formally document review results for program analysis and enrichment. This effort is ongoing and is planned through fiscal year 2024.

Other Infrastructures Needs - As part of the Agency’s new integrated compliance plan, the design will incorporate further actions to address meeting program reduction targets, including but not limited to: 1) changing the current sampling methodology to using better sound statistical, survey, and data collection methodologies that elevate past issues of “oversampling” and inefficient use of resources, while also ensuring the program dollars are delivered to all producers who are legally entitled to them; 2) utilizing a risk-based approach, where program risks and risk tolerances are identified to allow the right internal controls to be put in place, establish program metrics that gages the success of meeting objectives and need for improvements; 3) integrating a more proactive use of data mining to identify program key performance indicators, anomalies, fraud, waste, and abuse; and 4) performing a validity reassessment of current program oversight processes, such as oversight checklists, redelegation of authorities for approvals, etc.

These actions will also assist in capturing program impacts to targeted arenas of the historically underserved groups and determining where increased efforts are needed to improve accessibility to Farm Service Agency programs and services. For example, implementing routine sampling of denied applications on historically underserved groups to verify if approval and disapproval decisions are being made accurately.

Farm Service Agency is also coordinating with Farm Production and Conservation Business Center and the Department on the multi-year data management efforts to improve transparency, data mining, intelligence dashboards, and program analysis. Equally, significant investments in the development and utilization of program dashboards and visualizations have been made by Farm Service Agency. These efforts are helping to increase transparency, augment analytics capacity and make data readily available to support important mission-focused decision-making.

Farm Service Agency has built a number of dashboards to provide visualizations for its major Farm Programs and Farm Loan Programs, such as Coronavirus Food Assistance Program 1, Coronavirus Food Assistance Program 2, Wildfires and Hurricanes Indemnity Program Plus, Dairy Margin Coverage, Agriculture Risk Coverage and Price Loss Coverage, Conservation Reserve Program, Farm Loan Program Direct Loan Portfolio, Farm Loan Program Loan Obligations, program payments, acreage reporting, etc. Nationwide administrative dashboards to view office workload, productivity, and the geographic servicing areas for Farm Service Agency leadership and managerial staff have also been developed throughout fiscal year 2022.

The Agency is planning to request Congressional funding for enhancing: 1) transactional program systems/software to quickly meet the implementation demands of pandemic, emergency, and disaster programs and 2) interface systems to allow data sharing and eliminate manual/duplicative entries and processes.

Additional programmatic information

  • FY 2023 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    10/2021 - 09/2022


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.0

  • Actions taken & planned to mitigate improper payments

    Mitigation strategy Description of the corrective action Completion date Status
    Training
    The majority of incorrect acreage findings were related to grazing acres. Many factors determine animal units and if determined incorrectly, or data is erroneously entered in the worksheet or payment software, the payment amount will be incorrect. To mitigate future occurrences, specific training was conducted during agency’s call with State Noninsured Crop Disaster Assistance Program specialists to instruct them on accurately converting animal units into payment acres in the Grass for Grazing worksheet. Determining a crop’s production can be complex. Production may include, or be a combination of, harvested, appraised, and assigned production of a crop within a county, which may also include production from multiple farms with multiple fields. If one of the three types are determined incorrectly, the sum of the three will be incorrect, leading to an improper payment. Training on how to determine production was provided in January 2023 in Dallas TX.
    FY2023 Q2
    Completed
    Training
    Farm Service Agency has introduced many new ad hoc programs post Coronavirus Disease of 2019. There are multiple acreage reporting deadlines throughout the year depending on the crop. Due to the many acreage reporting deadlines in county offices, additional emphasis on accountability is necessary and will be communicated to state offices through acreage reporting training tentatively scheduled for fiscal year 2024.
    FY2024
    Planned

Overpayments

The Farm Service Agency administers all of its programs within the agency. Noninsured Crop Disaster Assistance program overpayments are the result of failure to access data/information. The incorrect number of acres, colonies, taps and incorrect production was used to calculate a payment. The majority of incorrect acreage findings were related to grazing acres. Many factors determine animal units and if determined incorrectly, or data is erroneously entered in the worksheet or payment software, the payment amount will be incorrect. To mitigate future occurrences, specific training was conducted during agency’s call with State Noninsured Crop Disaster Assistance Program specialists to instruct them on accurately converting animal units into payment acres in the Grass for Grazing worksheet.
Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $9.62 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $9.62 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0.0 M

Overpayment type Eligibility element/information needed Eligibility amount
Overpayments Within Agency Control Affiliation $9.62 M

Overpayment type Mitigation strategies taken Mitigation strategies planned
Overpayments within the agency’s control Training Training

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $0.18 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $0.18 M

Eligibility element/information needed Eligibility amount
Affiliation $0.18 M

Mitigation strategies taken Mitigation strategies planned
Training Training

Technically improper payments

The root cause of the improper payments was statutory requirement of the program were not met. The majority of the findings related to the CCC-576 not being approved, late-filing procedures not being followed and missing lease information.
The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $15.3 M

Mitigation strategies taken Mitigation strategies planned
Training Training

Additional information

$15.48 M

Unknown Payment Details

Evaluation of corrective actions

The overwhelming majority of incorrect acreage findings were related to grazing acres. Therefore, specific training will be conducted July 2023 during agency’s program call with State program specialists to instruct them on accurately converting animal units into payment acres in the Grass for Grazing worksheet. States will then be required to ensure county offices take the training, which will be recorded and posted on agency’s Deputy Administrator for Farm Program Training page.

Training on how to determine production was provided in January 2023 in Dallas TX, which would be after these findings were discovered but before most 2023 crops produce a yield or suffer a loss. The Noninsured Crop Disaster Assistance program team meets with state office specialists monthly to provide ongoing training and to address outstanding questions. These meetings are recorded and posted to the Noninsured Crop Disaster Assistance program training Page. The presentation is posted on agency’s Deputy Administrator for Farm Program Training page and is always available for state and counties to utilize as refresher training as needed, or to train newly hired staff.

Future payment integrity outlook

Noninsured Crop Disaster Assistance Program has established a baseline.

With the implementation of the current corrective actions and the planned corrective actions for the program, it is the agency’s anticipation that the projected reduction target will be less than the estimated future improper payment rate.

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $177 M
Current year +1 estimated future improper payments $17.6 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 9.94 %
Current year +1 estimated future improper payment and unknown payment reduction target 9.94 %

The program's current year improper payment and unknown payment rate of 10.46 % may or may not be the tolerable rate. The agency has not yet determined the tolerable rate for this program.

The agency does not have sufficient resources to add needed internal controls, human resources, and information systems to reduce the improper payment and unknown payments. The agency will continue to strategically take the necessary steps to strengthen internal control measures, establish uniform consistency for compliance processes, and improve accountability. A continuous evaluation system which monitors the effectiveness of internal controls is in place but is not sufficient to reduce improper payments rates. Lastly, agency will require key resources to continue its progression towards strengthening internal controls and addressing the inconsistencies with certain programs reporting more than the statutory improper payment threshold.

Noninsured Crop Disaster Assistance Program does not have sufficient resources to add needed internal controls, human resources, and information systems to reduce the improper payment and unknown payments. Noninsured Crop Disaster Assistance Program leverages the existing internal controls environment and accountability processes to provide reasonable assurances that internal controls are in place and operating effectively. A continuous evaluation system which monitors the effectiveness of internal controls is in place but is not sufficient to reduce improper payments rates.

The fiscal year 2024 President’s Budget and the fiscal year 2025 Department Estimates submitted to Office of Management and Budget does not include funding levels to support the required software enhancements to increase application controls. Due to budget constraints for the agency approved funding levels, the funding required to build automated internal controls within the existing systems is not included.

Additional programmatic information

The Safety Net Division within Farm Service Agency has historically communicated to field employees, improper payment percentages and findings which influence the program’s annual proper payment percentage. National training and monthly calls are provided for field staff covering program policies and payment errors. Online training materials such as PowerPoint presentations, recorded trainings, worksheets, videos, forms, and specialized third-party crop resources are made available for field staff.

  • FY 2024 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    10/2022 - 09/2023


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.0

  • Actions taken & planned to mitigate improper payments

    Mitigation strategy Description of the corrective action Completion date Status
    Training
    The root cause of these improper payments was failure to access data and specifically, acreage reporting findings related to late filed acreage reporting and not collecting a fee or establishing a register. The Safety Net Division addressed this by: 1) Late filed acreage reporting policy was provided November 14, 2023, during a Noninsured Crop Disaster Assistance Program monthly call with State office Noninsured Crop Disaster Assistance Program specialists. The training was recorded and is available on Deputy Administrator for Farm Program’s Noninsured Crop Disaster Assistance Program Training SharePoint page, 2) An acreage reporting task force was formed to develop solutions. Based on the findings, 2-CP amendment 28 was issued on April 12, 2024, 3) National training was provided the week of July 15, 2024. The training was recorded and is available on Deputy Administrator for Farm Program’s Noninsured Crop Disaster Assistance Program Training SharePoint page. 4) Monthly calls are held with State office Noninsured Crop Disaster Assistance Program specialists providing specific policy training and answering questions. All calls are recorded and posted on Deputy Administrator for Farm Program’s Noninsured Crop Disaster Assistance Program Training SharePoint page.
    FY2024 Q4
    Completed
    Audit
    The root cause of these improper payments was failure to access data. Noninsured Crop Disaster Assistance Program is currently part of Farm Service Agency’s Internal Control roadmap to improve program processes. 1. Currently in development is an improper payment trend analysis tool that has Fiscal Year 2019-2023 improper payment data. The tool will identify staff, county offices and states with continued improper payment findings. The tool will allow the agency to target county offices and staff for targeted training along with holding employees accountable, if warranted after training has been provided. 2. Standardized Training policy for Farm Programs is part of the internal control roadmap for Fiscal Year 2025. Training guidance would provide standardization for Headquarters, State and County level training.
    FY2025
    Planned

Overpayments

The root cause of these improper payments was failure to access data, and the overpayments were within the agency control (program administered by the Farm Service Agency). Through training, awareness, and policy amendments of acreage reporting provisions, the occurrence of these findings should reduce, thus lowering Noninsured Crop Disaster Assistance Program ‘s overall improper payment dollars and percentage. There were examples of lessor experienced county office workers accepting a late filed acreage report without realizing it was late filed. However, in order to effectively reduce the improper payments, system enhancements are required. Farm Service Agency’s information technology budget is not adequately funded to improve acreage reporting to identify late-filed reports and alert County office staff of special processing. Farm Service Agency will request Commodity Credit Corporation Section 4 and 11 funding during the Fiscal Year 2025 Commodity Credit Corporation budget request and Working Capital Fund request drills. Estimated funding requirements for system enhancement is $2 million.
Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $27.41 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $27.41 M

Overpayment root cause Overpayment amount
Amount of overpayments outside the agency's control $0.0 M

Overpayment type Eligibility element/information needed Eligibility amount
Overpayments Within Agency Control Affiliation $27.41 M

Overpayment type Mitigation strategies taken Mitigation strategies planned
Overpayments within the agency’s control Training Audit

Underpayments

Underpayment root cause Underpayment amount
Amount of underpayments $0.29 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $0.29 M

Eligibility element/information needed Eligibility amount
Affiliation $0.29 M

Mitigation strategies taken Mitigation strategies planned
Training Audit

Technically improper payments

Incorrect grazing acres and production accounting errors were the two primary findings that contributed to statutory requirements not being met. 1) Various grazing information such as animal units are manually entered in the Grass for Grazing worksheet, which is a customized excel spreadsheet that converts the information into acres. If for example, animal units are determined incorrectly, or the data is erroneously entered in the worksheet or payment software, the payment amount will be incorrect. This manual process has been identified as a software enhancement to automate the process preventing many of these specific data entry errors. However, the resources have not been available. 2) Production accounting may include, or be a combination of, harvested, appraised, and assigned production of a crop within a county, which may also include production from multiple farms with multiple fields. If one of the three types are determined incorrectly, the sum of the three will be incorrect, leading to an improper payment. The Noninsured Crop Disaster Assistance Program task force formed in the spring of 2024, suggested policy improvements to reduce findings associated with calculating production. One example is removing the requirement that all production must be verifiable or reliable. Policy has been amended to give the County Office Committee the authority to determine if production submitted is reasonable. 7 U.S. Code §7333 (d) specifies acres and yield, and (e) production, are part of the calculation for Noninsured Crop Disaster Assistance payments for yield-based crops.
The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $8.85 M

Mitigation strategies taken Mitigation strategies planned
Training Audit

Additional information

$9.14 M

Unknown Payment Details

Evaluation of corrective actions

Incorrect acreage reporting and production accounting have been perennial findings for Noninsured Crop Disaster Assistance Program. Accurate accounting can be complex when producers have multiple fields, and especially in multiple counties, or when determined animal units are converted to acres. While training has kept these findings from increasing, automation enhancements are needed to assure that acres are not missed, and animal units are converted correctly; however, funding has not been available. In the meantime, current payment software has hard stops or warning boxes to alert users when data is missing, or procedures are not being followed. Specific national training has been given as recently as July 15-19, 2024. All trainings are recorded and posted on Deputy Administrator for Farm Program’s Noninsured Crop Disaster Assistance Program Training page. Further, Safety Net Division holds monthly Noninsured Crop Disaster Assistance Program calls with State Office Noninsured Crop Disaster Assistance Program specialists to discuss findings and answer questions. All calls are recorded and posted on Deputy Administrator for Farm Program’s Noninsured Crop Disaster Assistance Program Training page. These corrective actions are sufficient to mitigate Noninsured Crop Disaster Assistance Program’s improper dollars of $8.85 million related to statutory requirements not met.

The root cause of these improper payments was statutory requirements of program not met. Proof that corrective actions such as training and awareness have had a positive impact is that Noninsured Crop Disaster Assistance Program’s Statutory Requirements Not Being Met category was reduced in Fiscal Year 2024 by 42% percent compared to Fiscal Year 2023.

Overall, Noninsured Crop Disaster Assistance Program’s improper payment percentage has remained between 9-11 percent for the last three years which included many pandemic related ad hoc programs which were being administered during this time by the same people administering Noninsured Crop Disaster Assistance Program. The above corrective actions are adequate to address the cause of the improper payments.

The root cause of these improper payments was statutory requirements of program not met. To address these findings, Safety Net Division established a Noninsured Crop Disaster Assistance Program task force in 2024 primarily consisting of State and county office Noninsured Crop Disaster Assistance Program specialists for comments and to discuss Noninsured Crop Disaster Assistance Program’s findings and policy challenges and suggest possible policy improvements. The task force met in Kansas City from February 5-9, 2024, and virtually throughout the spring of 2024. Based on their findings, amendments to policy were presented at national training during the week of July 15, 2024.

At the same time, Safety Net Division established an acreage reporting task force consisting of State and county office Noninsured Crop Disaster Assistance Program specialists to discuss issues, findings, and suggest solutions relating to acreage reporting. The outcome was 2-CP amendment 28 issued on April 12, 2024. The above corrective actions are focused on the cause of the improper payments.

Actions taken to reduce Noninsured Crop Disaster Assistance Program’s improper payment percentage has been effective. The 2014 Farm Bill had policy changes for Noninsured Crop Disaster Assistance Program including multiple coverage levels. Policy, forms, and program automation had to be developed to accommodate the new legislation. In Fiscal Year 2019, Noninsured Crop Disaster Assistance Program’s improper payment percentage increased to 23 percent. Safety Net Division began a concentrated effort to reduce Noninsured Crop Disaster Assistance Program’s improper percentage and in Fiscal Year 2022, Noninsured Crop Disaster Assistance Program’s improper payment percentage was reduced to 9.47 percent. Noninsured Crop Disaster Assistance Program’s improper payment percentage has increased one percent in each of the last two fiscal years in part due to increased participation in Noninsured Crop Disaster Assistance Program, and a lack of funding for software enhancements.

Actions taken included developing payment software to calculate the multiple coverage level options, updating the CCC-NAP 770 and requiring it to be completed with a second party review prior to a payment being disbursed became a policy requirement. Also, Noninsured Crop Disaster Assistance Program monthly calls were established, and improper payment awareness was increased. All contributed to reducing Noninsured Crop Disaster Assistance Program’s improper payment percentage. These corrective actions will be effectively implemented and prioritized within the agency to reduce improper payments.

Future payment integrity outlook

Noninsured Crop Disaster Assistance Program has established a baseline.

With the implementation of the current corrective actions and the planned corrective actions for the program, it is the agency’s anticipation that the projected reduction target will be less than the estimated future improper payment rate.

Out-Year improper payment and unknown payment projections and target
Current year +1 estimated future outlays $391 M
Current year +1 estimated future improper payments $40.9 M
Current year +1 estimated future unknown payments $0 M
Current year +1 estimated future improper payment and unknown payment rate 10.46 %
Current year +1 estimated future improper payment and unknown payment reduction target 10.46 %

The program's current year improper payment and unknown payment rate of 11.61 % may or may not be the tolerable rate. The agency has not yet determined the tolerable rate for this program.

The agency’s target rate for Noninsured Crop Disaster Assistance Program is to have an improper payment percentage below 10 percent, however this may not represent the definition of a “tolerable rate”. All corrective actions taken by the agency have been implemented with the goal to be within the 10 percent threshold.

A tolerable rate for Noninsured Crop Disaster Assistance Program has not been established however, the Agency is in the process of establishing additional internal controls for its permanent programs such as Noninsured Crop Disaster Assistance Program. For example, Farm Service Agency is in the process of establishing a monitoring system to assure that county offices review payments before being issued. The system also has an accountability component to identify offices that struggle to disburse proper payments. Once implemented, Farm Service Agency will be in a position to determine a tolerable rate based on established data.

In order to reduce Noninsured Crop Disaster Assistance Program’s improper payments, system enhancements and training for staff is required however, Farm Service Agency’s information technology budget is not adequately funded to implement the requested enhancements. Farm Service Agency will request Commodity Credit Corporation Section 4 and 11 funding during the Fiscal Year 2025 Commodity Credit Corporation budget request and Working Capital Fund request drills. Estimated funding requirements for system enhancement is $2 million.

Additional programmatic information

Accountability for detecting, preventing, and recovering improper payments

Farm Service Agency has incorporated an accountability mechanism into the performance plans applicable to supervisory positions, as specified in Notice PM-3065 “Fiscal Year 2023 Performance Plans” (published December 5, 2022), to ensure adequate internal controls compliance for all programs are in place to improve future program delivery and reduce improper payments. The standards require supervisors to:

· Timely address any Payment Integrity Information Act findings and that training is provided to employees to improve future program delivery and reduce improper payments.
· Ensure automation specialists include program integrity in software.
· Work collaboratively to proactively include processes for program integrity and proper audit trail in software.
· Proactively includes processes for program integrity in procedure, provides timely monitoring of program administration, alerts supervisor immediately as issues of potential concern arise.
· Alert supervisor at once as issues of potential concern arise.

Senior Agency Officials will be accountable for the compliance progress for Noninsured Crop Disaster Assistance Program, engaging field staff when applicable, and oversight support of the Office of Management and Strategy follow up activities:

· John J. Berge, Acting Deputy Administrator for Farm Programs
· Marcus Graham, Deputy Administrator for Field Operations

  • FY 2025 improper payment estimates

    Chart legend and breakdown

    Payment accuracy rate

    Improper payment rate

    Unknown payment rate


    Sampling & estimation methodology details

    Sampling timeframe:

    10/2023 - 09/2024


    Confidence interval:

    95% to <100%


    Margin of error:

    +/-3.975

Causes

The causes of improper payments are related to not following statutory requirements for acreage reporting, payment limitations and eligibility.

Additionally improper payments were caused by failure to access data errors related to acreage reporting, conservation compliance, crop risk, and calculation errors related to production, acreage, and carrying capacity.

Specific scenarios that caused the improper payments are:
Missing or incomplete acreage reports
Missing or incomplete forms reflecting environmental compliance
Crop risk errors
Calculation errors

Overpayment root cause Overpayment amount
Amount of overpayments within the agency's control $14.95 M
Amount of overpayments outside the agency's control $0.0 M
Amount of overpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
Amount of overpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
Amount of overpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $14.95 M

Underpayment root cause Underpayment amount
Amount of underpayments $0.98 M
The amount of underpayments that occurred because the data/information needed to validate payment accuracy prior to making a payment does not exist $0.0 M
The amount of underpayments that occurred because of an inability to access the data/information needed to validate payment accuracy prior to making a payment $0.0 M
The amount of underpayments that occurred because of a failure to access data/information needed to validate payment accuracy prior to making a payment $0.98 M

The amount of improper payments that were paid to the right recipient for the correct amount but were considered technically improper because of failure to follow statute or regulation $3.69 M

The amount that could either be proper or improper but the agency is unable to determine whether it was proper or improper as a result of insufficient or lack of documentation $0.0 M

Prevention

FSA’s corrective actions efforts for the NAP program focused on addressing these (5) improper payment issues:
1) Incorrect values entered or applied for payment factors not correctly applied; incorrect number of acres/colonies/taps, carrying capacity, harvested production, Animal Unit Day (AUD) loss factor, yield or appraised production.
2) Program eligibility for CCC-576 (Notice of Loss) was not on file, was not properly late-file or was approved for an ineligible disaster event; CCC-452 (NAP Actual Production History and Approved Yield Record) was not on file or not timely signed by the participant; ineligible for quality loss; CCC-471(Noninsured Crop Disaster Assistance Application) late-file provisions were not met; payee did not share in the risk of producing the crop; missing State Committee concurrence when applying Animal Unit Day (AUD) loss factor; CCC-860 (Socially Disadvantage, Limited Resource, Beginning and Veteran Farmer or Rancher Certification) does not support service fee waiver.
3) Application/Contract/Agreement for CCC-576 (Application for Payment) was missing producer signature, was not approved or was incomplete.
4) Acreage reporting, FSA-578 (Report of Acreage) was not on file, not timely filed or not properly late-filed.
5) Payment eligibility for Compliance with Adjusted Gross Income (AGI) was not met.

To correct these deficiencies and strengthen overall program integrity, FSA implemented a comprehensive set of corrective actions across (4) major areas – Policy, Software Enhancements, Training, and Internal Control Processes. The paragraphs below describe the actions taken or planned within each of these categories to mitigate and reduce improper payments and improve program compliance.

Policy:
• An acreage reporting task force was formed in the fall of fiscal year 2023 to discuss options for improving late-filed acreage report policy. Policy changes (2-CP Handbook, Amendment 28) were implemented April 2024, eliminating fees or a register if the producer can provide evidence of existence or disposition of the crop, for example seed, input, or production records. The full impact of these changes will not be realized until fiscal year 2026 payments are tested during fiscal year 2027 payment integrity testing.
• Notice NAP-242 was issued April 2025 and provided policy for late-planted annual forage acreage intended for grazing. An assigned Animal Unit Daily (AUD) Calculator worksheet was introduced for determining assigned AUDs for late planted acreage intended for grazing and to reduce staff calculation errors.
• In response to recurring documentation deficiencies, FSA issued Handbook 2-CP Amendments 28 issued April 12, 2024, to strengthen acreage reporting requirements and improve consistency across county offices. These amendments establish clear and consistent procedures for late-filed acreage reports, including acceptable non-physical evidence of crop existence/ disposition of crops when inspections are not performed.
• FSA annually issues an internal directive for field staff that identifies common/program specific error findings, the applicable policy references, and instructions for resolving errors identified through the National Payment Integrity Review. The Agency anticipates releasing a notice for the fiscal year 2025 National Payment Integrity Review findings, with a planned completion date of January 2026.
• Additionally, FSA’s Administrator issued an internal compliance memo to all FSA employees on April18, 2025, which reinforced the importance of program integrity, set expectations for staff to proactively address internal and external compliance findings and corrective actions and announced planned and reiterated existing compliance activities to strengthen FSA programs through risk management and accountability.

Software Enhancements:
• Beginning in 2026 and subsequent years, FSA’s Crop Acreage Reporting System (CARS) will automatically determine whether an acreage report for a crop has been timely certified by the applicable reporting deadline and whether it remains timely under the Agency’s Handbook 2-CP policy. This enhancement was completed March 2025 (be effective for program year 2026) and will help mitigate FSA-578 (Acreage Reporting) errors.

Training:
• In addition, a series of FSA acreage reporting training courses were developed on USDA’s training platform, AgLearn, for employees. New employees are required to take these courses, while all current employees have access to the training. This action was completed November 2024 and continues to strengthen staff knowledge of acreage-reporting requirements, increase awareness of policy expectations, and is designed to reduce documentation errors that contribute to improper payments.
• Ongoing monthly NAP training calls with State Office Specialists will continue to focus on policy and comprehensive reviews of all improper payment findings to bring awareness and reduce findings. All training recordings are available for County Offices reference.

Internal Control Process:
• Completed March 2025, FSA published the Payment Integrity Information Act Dashboard that includes all high risk tested programs (including NAP) and based on improper payment findings from fiscal year 2021-2024. This dashboard adds another data source for FSA, providing the ability to identify targeted training needs across States and County Offices and helps to assess if current root causes are new or perennially repeated.
• Spot checks/data mining activities to detect anomalies are being conducted to ensure training is provided at critical times and prior to deadlines. These actions are ongoing.
• FSA has required all identified high risk programs to have a Program Internal Control Plan (ICP) that outlines program risks, their risk levels and a Risk Matrix that identifies internal control actions taken to mitigate risks. NAP’s ICP has been amended, and a Risk Matrix was developed in September 2025 to assist in improving program integrity.
As evidenced by the 1.1% decrease in the NAP improper payment rate since fiscal year 2024, FSA’s corrective actions have been effective in addressing the root causes of improper payments.

Corrective actions taken and planned to reduce improper payments are proportional to their severity. Improper payment errors are related to:
1) Incorrect values entered or applied for payment factors not correctly applied; incorrect number of acres/colonies/taps, carrying capacity, harvested production, Animal Unit Day (AUD) loss factor, yield or appraised production. (estimated $8.3M)
2) Program eligibility for CCC-576 (Notice of Loss) was not on file, was not properly late-file or was approved for an ineligible disaster event; CCC-452 (NAP Actual Production History and Approved Yield Record) was not on file or not timely signed by the participant; ineligible for quality loss; CCC-471(Noninsured Crop Disaster Assistance Application) late-file provisions were not met; payee did not share in the risk of producing the crop; missing State Committee concurrence when applying Animal Unit Day (AUD) loss factor; CCC-860 (Socially Disadvantage, Limited Resource, Beginning and Veteran Farmer or Rancher Certification) does not support service fee waiver. (estimated $6.1M)
3) Application/Contract/Agreement for CCC-576 (Application for Payment) was missing producer signature, was not approved or was incomplete. (estimated $1.9M)
4) Acreage reporting – FSA-578 (Report of Acreage) was not on file, not timely filed or not properly late-filed. (estimated $1.7M)
5) Payment eligibility for Compliance with Adjusted Gross Income (AGI) was not met. (estimated $280K)

FSA, in coordination with the Performance, Accountability and Risk Division of the Farm Production and Conservation (FPAC) Business Center, conducts a comprehensive analysis of improper payment results on an annual basis. This analysis relates specific findings to the associated amount of improper dollars and the frequency of the occurrence of improper payment findings. This in-depth level of analysis affords FSA the ability to plan corrective actions proportional to the severity of the associated improper payments all while being cognitive of available resources and burdens. These efforts help ensure corrective actions are directly linked to specific findings and are carried out with the intent of reducing future improper payments. FSA’s corrective actions related to policy, software enhancements, training and internal control process improvements address the causes of improper payments and are proportional to the severity of improper payments.


Based on the scope and impact of the root causes, corrective actions may include spot checking/data mining for programmatic anomalies, recommending policy or procedure changes, and issuing or implementing other targeted initiatives. This strategic, coordinated approach ensures that corrective actions are both effective and aligned with broader compliance and program integrity goals.
FSA’s comprehensive analysis of improper payment finding types enables the development of targeted corrective action plans based on cause category, error types, locations, and other key variables. From there, corrective action plans are designed to influence or change behavior, update current procedures, disseminate informational memorandums, revise policy language, introduce new policy language or procedures, and leverage data analytics. They are also closely integrated with ongoing internal processes such as internal control plans and risk matrices. This approach, combined with continuous finding analysis and aligned corrective action efforts from other FSA initiatives has proven to be effective as exhibited in NAP’s 1.1% decrease in the improper payment rate as compared to 2024.

Payment type Mitigation strategies taken Mitigation strategies planned
Overpayments Change Process Change Process
Underpayments Change Process Change Process
Technically improper payments Change Process Change Process

Additional information

The Noninsured Disaster Assistance Program (NAP) offers financial support to producers of non-insurable crops to protect against natural disasters that result in lower yields, destroyed crops, or the inability to plant. Ultimately, helping producers manage risk and maintain their operations during and after adverse conditions.
FSA is making measurable progress in improving program integrity and accountability and remains committed to building on these improvements as we continue serving America's farmers and ranchers.

Reduction target

9.96 %

The Agency does not have what is needed with respect to internal controls, human capital and information system and other infrastructure to reduce improper payments and unknown payments to a level below which further expenditures to reduce improper payments would cost more than the amount those expenditures would save in prevented or recovered improper payments. Due to reductions in FSA’s budget, staffing losses and recent retirements, FSA has found it challenging to sustain a consistent internal control effort and maintain the capacity required to further decrease improper payment risks. These resource constraints limit the Agency’s ability to fully implement and sustain systems and oversight mechanisms necessary to bring improper payments to their lowest achievable level.

FSA requested $2 million for several program system enhancements to include critical enhancements needed for the Crop Acreage Reporting System (CARS) that strengthens payment integrity controls. However, the Agency received $344K, which was allocated across all farm programs to maximize the impact of the limited funding and support the most essential internal control improvements achievable within the reduced budget.

In fiscal year 2022, to address program integrity and accountability deficiencies, FSA incorporated internal control accountability requirements into annual performance plans beginning with FSA Notice PM – 3051. These added criteria require supervisors to establish, document and maintain adequate internal controls to support compliant program delivery and reduce improper payments.
In FSA Notice PM – 3068, issued in fiscal year 2023, FSA expanded these accountability standards to both supervisory and non-supervisory headquarter positions, modifying the “Mission Results” element to include explicit expectations for internal control compliance, monitoring and corrective action implementation. These performance expectations have been carried forward and are now included in performance plans every fiscal year for all supervisory and non-supervisory positions.
Annual performance plan criteria require personnel, especially supervisors, to ensure improper payments are prevented through control activities and overpayments are promptly detected, documented, reported and recovered in accordance with program policy. Supervisors are evaluated on their ability to make sure staff follow required review procedures, maintain accuracy in program certifications and take timely corrective actions when errors or deficiencies are identified.
Internal control accountability applies to:
• supervisors at all levels, who must establish and maintain an effective control environment, conduct oversight and ensure corrective actions are implemented;
• non-supervisory program and operational staff, who must follow established internal control procedures, maintain accurate documentation and support integrity reviews; and
• headquarter program managers, who must implement internal control guidance and ensure National policies support proper payment and error reduction.

Per FSA Notice PM 3088 supervisors are specifically responsible for:
• ensuring internal controls are implemented and functioning as intended;
• monitoring compliance with program policy;
• supporting internal and external audit activities; and
• ensuring timely corrective action and resolving deficiencies identified through reviews.

Steps taken to hold personnel accountable are:
• internal control expectations are embedded in annual performance plans for supervisors and staff forming part of their formal performance evaluation;
• quarterly progress performance reviews assess whether personnel are meeting internal control requirements supporting timely course correction; and
• supervisors must document actions taken to strengthen controls, address program errors and ensure payment accuracy.

Actions taken to monitor progress include:
• FSA conducts monitoring through quarterly performance discussions, internal control reviews and spot checks and quality control findings;
• supervisors are required to provide oversight of program internal controls implementation, verify staff compliance and report progress of completing corrective actions; and
• national spot checks and reviews, including external payment integrity reviews by FPAC-PAR, serve as validation checkpoints to measure whether the control environment is preventing improper payments and correcting deficiencies.

$4.67 M