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Ag Commissioner Troxler Demystifies Final Tobacco Transition Program Payment

The final Tobacco Transition Payment is due to be mailed this week. There has been some controversy surrounding it, whether it would be subject to the sequester and then not..

North Carolina Ag Commissioner Steve Troxler
“Last week USDA did announce that the final year fo the Tobacco Transition Payment program will be exempt from the sequestion cuts. That was news tha many farmers were happy to hear. The media was acting as if everything was all fine, but I need to throw some cold water on that so everyone understands what is coming.
The people who are receiving these payments will only get 95% of the payment that they have gotten in previous years. The remaining 5% is scheduled to be paid after the new federal budget year begins next October, and then it could be a while before these payments are actually made after that.
Basically we are getting a payment and a promise. I hope the promise is made good.
I do want to point out that it was never USDA that was the problem with this. They were actually on our side and knew that these payments should not be sequestered. I want to reiterate that the local FSA offices have nothing to do with this. They will put the payment out as it comes from USDA. This is a decision that was made in the budget office.
Our whole congressional delegation has been involved in making sure this money was not sequestered. A lot of people in my office worked hard. We have done what we can do and I hope that USDA lives up to their promise of the 5%. That doesn’t sound like a lot of money, but the 7.2% that they were talking about sequestering came up to $68 million. So we are still talking about $50 million being withheld out of our economy.

Its not just individual farmers but also lending institutions. They securitized this money and took the payments in a lump sum upfront. So they are on the hook for this money as well.”'

A native of the Texas Panhandle, Rhonda was born and raised on a cotton farm where she saw cotton farming evolve from ditch irrigation to center pivot irrigation and harvest trailers to modules. After graduating from Texas Tech University, she got her start in radio with KGNC News Talk 710 in Amarillo, Texas.