Posted September 5, 2013
According to a report released by USDA’s Office of Inspector General (OIG), USDA made 239 “high-dollar” overpayments totaling approximately $20.3 million in fiscal year 2012. No “high-dollar” overpayments, however, came from nutrition programs. The report is available here.
Members of Congress returning from their recess and preparing to head to conference over a 2013 farm bill, will confront the “news that USDA sent out more money than it should have for subsidies and that other farmer assistance rose by 67 percent in 2012” according to a Politico article, available here. Congress will also confront the news that there were no “high-dollar” overpayments from the nutrition programs designated as “high risk.” The farm bill debate “over food stamps has been so heated” that “House leadership stripped out the food stamp portion of a farm bill that was narrowly approved in July.”
The report is required by Executive Order 13520, “Reducing Improper Payments” and is intended to “intensify efforts to eliminate payment error, waste, fraud, and abuse in Federal programs.” The Executive Order requires the OIG to review USDA’s “high-dollar” overpayment reports and recommend plans to recover and prevent those overpayments. To be included in the report as a “high-dollar” overpayment, an overpayment must be at least 50 percent more than the correct amount and more than $5,000 to an individual or $25,000 to an entity for the quarter.
USDA designated 16 “high-risk” programs included in the OIG’s audit and Report. Exhibit B of the report provides information on overpayment by USDA agency. USDA’s Federal Crop Insurance Corporation Program Fund (FCIC) had the highest number and amount of overpayments. The FCIC overpaid 70 individuals or entities for a total of about $14.7 million. The NRCS’s Farm Security and Rural Investment Program overpaid 53 individuals or entities for a total of about $2.8 million in overpayments.
There were no “high-dollar” overpayments in the USDA’s high-risk nutrition programs including the National School Lunch Program, the Special Supplemental Nutrition Program for Infants, Women, and Children (WIC), and the Supplemental Nutrition Assistance Program (SNAP).
The report suggests that USDA can reduce overpayment by additional oversight, better bookkeeping, and reporting errors in a shorter time period.
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