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ExpectMore.govExpectMore.gov home pageEXPECT FEDERAL PROGRAMS TO PERFORM WELL, AND BETTER EVERY YEAR.
 
Program Assessment

Program

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Dairy Payment Program

The Department of Agriculture provides a monthly income payment to dairy farmers when milk prices fall below a specified level. Over 80% of licensed U.S. dairies have received payments. The payment is capped so that benefits target dairy size and not all dairy production.

Rating

What This Rating Means

PERFORMING
Adequate

This rating describes a program that needs to set more ambitious goals, achieve better results, improve accountability or strengthen its management practices.
  • This program has a modest impact on slowing the decline in production on small to medium size dairy operations. Dairy production is increasing in the U.S., but declining on farms with fewer than 200 cows. Market forces continue to drive consolidation and increase output from larger dairies. Milk production and cow numbers will continue to decline in some states even with this program.
  • The safety net benefits of the MILC program are not compatible with other USDA dairy programs. The MILC program provides targeted income support over and above the Milk Price Support Program (MPSP). Taken together, the impact of the MILC program, in conjunction with the Milk Price Support program, have not been shown to significantly support producer prices, or address price variability.
  • The program has design flaws. Because payments are tied to production, the program has trade distoring impacts. If the program covered all U.S. dairy production at the current support price, program costs and production distorting effects would increase significantly.

Improvement Plan

About Improvement Plans

We are taking the following actions to improve the performance of the program:

  • Examining this program, along with other dairy assistance programs, to assess program altnernatives that improve performance.
  • Continuing to strengthen controls in the program's disbursement system, as identified in financial audits.

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