A 2007 report that the federal government had paid $1.1 billion in subsidies to dead farmers sparked an outcry and has been frequently cited by critics who considered the payments a blatant example of wasteful spending. But a follow-up that found no fraud and determined nearly all the subsidies paid on behalf of dead farmers in recent years were proper has received little attention.
According to USDA's Farm Service Agency, just a little over $1 million out of the billions of dollars paid in subsidies in 2009 went to estates or business entities that weren't entitled to them.
"Very little money is going to individuals who have not earned that money. Very little is being paid in error because a farmer has passed away," FSA Administrator Jonathan Coppess told The Associated Press.
The Government Accountability Office produced the 2007 report at the request of Sen. Charles Grassley, R-Iowa. It found the USDA had sent $1.1 billion to more than 170,000 dead people from 1999 through 2005, and the FSA's weak verification procedures meant the agency, which administers farm payment programs, couldn't be certain those payments were proper.
Grassley said then that it was "unconscionable that the Department of Agriculture would think that a dead person was actively engaged in the business of farming."
Sen. Tom Coburn, R-Okla., has frequently criticized the checks sent to dead farmers. Last October, he issued an 18-page report decrying the $1.1 billion in farm payments as the biggest of several examples of "Federal Programs to Die For — American Tax Dollars Sent Six Feet Under."
When then-Senate candidate Rand Paul, a tea party favorite from Kentucky, insisted he was a moderate on farm subsidies during a June interview with WHAS-AM of Louisville, Ky., he added, "Let's start out by eliminating farm subsidies for dead farmers."
Despite the concerns raised about lavishing taxpayers' money on the dead, the government is legally obligated to make payments to farmers' survivors, estates, partnerships and other business entities they were involved in if the farmers qualified for the benefit before they died. FSA officials said the agency has gone to great effort to make sure all its payments were legal and recover those that weren't.
FSA spokesman Kent Politsch said the agency began making changes even before the GAO report came out. It began matching payment information against Social Security death records for the 2007 fiscal year. The agency flagged 121,527 payments totaling $108 million in that fiscal year that were sent on behalf of people who had died. It found that in nearly every case, the dead farmers' estates or other entities were legally entitled to the money.