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Title 7, AgricultureRelease 119-73not60

§1308–2 Denial of Program Benefits

Title 7 › Chapter 35— AGRICULTURAL ADJUSTMENT ACT OF 1938 › Subchapter II— LOANS, PARITY PAYMENTS, CONSUMER SAFEGUARDS, MARKETING QUOTAS, AND MARKETING CERTIFICATES › Part A— Definitions, Loans, Parity Payments, and Consumer Safeguards › § 1308–2

Last updated Apr 3, 2026|Official source

Summary

The Secretary can block certain farm program payments to a person or business when the Secretary finds they broke the rules. If someone failed to follow a related rule and joined a plan to avoid rules 1308, 1308–1, or 1308–3, or if they purposely hid their ownership in a farm, they lose payments for the crop year when the violation is found and the next crop year. If a person knowingly made or helped make fake papers, hid important facts, or did similarly serious acts, the Secretary can stop payments for up to 5 crop years. Money that would have gone to a disqualified person is cut back in proportion to their ownership share. The same proportional cut applies if a cash-rent tenant works on a farm owned or controlled by a disqualified person. A business and its members who knowingly took part in an evasion scheme must together pay back any sums owed, including costs to recover them. The Secretary may reduce or drop that liability if someone cooperates in enforcing the rules.

Full Legal Text

Title 7, §1308–2

Agriculture, Source: USLM XML via OLRC

(a)A person or legal entity shall be ineligible to receive payments specified in subsections (b) and (c) of section 1308 of this title for the crop year, and the succeeding crop year, in which the Secretary determines that the person or legal entity—
(1)failed to comply with section 1308–1(b) of this title and adopted or participated in adopting a scheme or device to evade the application of section 1308, 1308–1, or 1308–3 of this title; or
(2)intentionally concealed the interest of the person or legal entity in any farm or legal entity engaged in farming.
(b)If the Secretary determines that a person or legal entity, for the benefit of the person or legal entity or the benefit of any other person or legal entity, has knowingly engaged in, or aided in the creation of a fraudulent document, failed to disclose material information relevant to the administration of sections 1308 through 1308–5 of this title, or committed other equally serious actions (as identified in regulations issued by the Secretary), the Secretary may for a period not to exceed 5 crop years deny the issuance of payments to the person or legal entity.
(c)(1)Payments otherwise owed to a person or legal entity described in subsections (a) or (b) shall be denied in a pro rata manner based on the ownership interest of the person or legal entity in a farm.
(2)Payments otherwise payable to a person or legal entity shall be denied in a pro rata manner if the person or legal entity is a cash rent tenant on a farm owned or under the control of a person or legal entity with respect to which a determination has been made under subsection (a) or (b).
(d)Any legal entity (including qualified pass-through entities) and any member of any legal entity determined to have knowingly participated in a scheme or device to evade, or that has the purpose of evading, section 1308, 1308–1, or 1308–3 of this title shall be jointly and severally liable for any amounts that are payable to the Secretary as the result of the scheme or device (including amounts necessary to recover those amounts).
(e)The Secretary may partially or fully release from liability any person or legal entity who cooperates with the Secretary in enforcing section 1308, 1308–1, and 1308–3 of this title, and this section.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Codification Pub. L. 110–234 and Pub. L. 110–246 made identical

Amendments

to this section. The

Amendments

by Pub. L. 110–234 were repealed by section 4(a) of Pub. L. 110–246. Section was enacted as part of the Food Security Act of 1985, and not as part of the Agricultural Adjustment Act of 1938 which comprises this chapter.

Amendments

2025—Subsec. (d). Pub. L. 119–21 substituted “qualified pass-through entities” for “partnerships and joint ventures”. 2008—Pub. L. 110–246, § 1603(e), amended section generally. Prior to amendment, text read as follows: “If the Secretary of Agriculture determines that any person has adopted a scheme or device to evade, or that has the purpose of evading, section 1308, 1308–1, or 1308–3 of this title, such person shall be ineligible to receive farm program payments (as described in subsections (b), (c), and (d) of section 1308 of this title as being subject to limitation) applicable to the crop year for which such scheme or device was adopted and the succeeding crop year.” 2002—Pub. L. 107–171 substituted “as described in subsections (b), (c), and (d) of section 1308 of this title” for “as described in paragraphs (1) and (2) of section 1308 of this title”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2008 AmendmentAmendment of this section and repeal of Pub. L. 110–234 by Pub. L. 110–246 effective May 22, 2008, the date of enactment of Pub. L. 110–234, see section 4 of Pub. L. 110–246, set out as an

Effective Date

note under section 8701 of this title.

Effective Date

Pub. L. 100–203, title I, § 1304(b), Dec. 22, 1987, 101 Stat. 1330–17, provided that this section is effective beginning with the 1989 crops. Transition Provisions Section, as in effect on Sept. 30, 2007, to continue to apply with respect to the 2007 and 2008 crops of any covered commodity or peanuts, see section 1603(h) of Pub. L. 110–246, set out as a note under section 1308 of this title.

Reference

Citations & Metadata

Citation

7 U.S.C. § 1308–2

Title 7, Agriculture

Last Updated

Apr 3, 2026

Release point: 119-73not60