GAO: Dead farmers might be reaping millions in subsidies

The Agriculture Department might be sending millions of dollars in subsidies to dead farmers, the nonpartisan Government Accountability Office (GAO) said Monday.

The agency looked at crop insurance data from 2008 to 2012 and “found that $22 million in subsidies and allowances may have been provided on behalf of an estimated 3,434 program policyholders two or more years after death.”

The USDA's Risk Management Agency (RMA), which subsidizes crop insurance, appears to have the biggest problem with making payments to people who are deceased, according to investigators.

The GAO found that the RMA “cannot be certain” the subsidies it distributes are proper because it does not compare policies to death records.

The data also suggests that environmental payments are going to the dead. Between 2008 and 2012, the GAO estimates $10.6 million went to 1,103 dead farmers. The National Resource Conservation Service is not reviewing its subsidies to check, the agency said.

The revelations come as Congress is struggling to pass a trillion-dollar farm bill to reauthorize farm subsidies, crop insurance and food stamps.

Conservative groups such as Heritage Action and Club for Growth opposed a House-passed farm bill this month. The groups say the $15 billion or less in cuts to farm subsidies in the bill is insufficient, and note that President Obama has called for more.

House Democrats, meanwhile, have proposed replacing the sequester with $40 billion in cuts to farm subsidies.

The report could give new ammunition to critics of farm spending.

"It is appalling to learn that bureaucrats didn’t match the names of the recipients of crop insurance with the Social Security Administration’s master list of deceased individuals,” said Scott Faber of The Environmental Working Group. “This irresponsible use of scarce taxpayer dollars reinforces just how broken the system is and how badly it is in need of reform."

The audit found that the Farm Service Agency has made some strides on policing the payments and was able to identify $3 million in payments to the dead, of which it has retrieved $1 million. But GAO found the 9 percent of payments on a randomized basis were not documented properly and could be improper. 

While the payments are large, they are small compared to the size of the government subsidy programs.  

“In 2012, FSA provided $7.4 billion for farm commodity and conservation programs, NRCS provided $4.0 billion for financial and technical assistance in conservation efforts, and RMA provided $8.3 billion in subsidies and allowances for crop insurance,” the report notes.

The GAO audit said the USDA generally agreed with its findings. 

The department said that the crop insurance agency had already instituted a new computer matching system that it plans to link to Social Security death records.

“The steps RMA is taking are promising. We encourage NRCS to take similar steps, because until and unless NRCS has its payment data records matched against SSA’s complete death master file, it cannot know if it is providing payments to deceased individuals or whether these payments are proper or improper,” the GAO said. 

This story was updated at 5:07 p.m.