SECTION II | OTHER INFORMATION

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IMPROPER PAYMENT CORRECTIVE ACTIONS SECTION

In the spring of 2019, USDA agencies analyzed transactions from previous years as described 

in the Agency Financial Report’s sampling section and the results are published in the FY 2019

AFR. Please keep in mind that since USDA reports improper payments one year in arrears, 

corrective actions taken to reduce improper payments in FY 2019 have not been reflected in the 

improper payment amount of this report. USDA continues to enact specific corrective actions 

to resolve root causes of improper payments and strategically strengthen program integrity 

while ensuring access to program and activities. 

Programs and activities determined to have improper payments exceeding the susceptible to 

significant improper payment threshold (per OMB-18-20) must put in place a corrective action 

plan to prevent and reduce the improper payment amount. The tables below describe the

actions taken and planned for each high-risk program that is above the aforementioned 

reporting threshold. Beginning in FY 2019, USDA asked high-risk programs reporting over the 

statutory threshold to categorize improper payments into “sub root causes” which provide an 

additional breakdown of the OMB root causes of error. The goal of the sub root cause is to help 

USDA obtain a clearer understanding of what truly caused the improper payments to occur.

OMB-18-20, states: “Agencies should also describe the results of actions taken to address the 

root causes and the planned or actual completion date of the actions taken to address each root 

cause.” Some of the corrective actions offer an indication of the impact it will have on 

addressing a root cause; however, in most cases, a series of corrective actions have cumulative 

impacts in improving payment accuracy.
USDA ANNUAL FINANCIAL REPORT | 2018 

2

Program Corrective Actions Table ($ in Millions)

PROGRAM: FSA ARC/PLC 

Root Cause (See Root Cause Table)  Administrative or Process Error Made by 

Federal Agency

USDA’s Sub Root Cause 

• Acreage reports were filed late.

• Contracts were approved in software,

but no official documentation existed 

to support the approval.

• Producer did not sign contract timely.

• Form 861, Price Loss Coverage and 

Agriculture Risk Coverage with County 

Option Program Contract was not on 

file prior to payment being made.

• Historical Irrigated Percentage (HIP)

was not filed prior to payment being 

issued.

Amount Associated with the Root 

Cause (See Root Cause Table)  $250.26

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations.

August 2019

Deputy Administrators will reiterate the importance of following existing 

policies regarding signing and approving contracts before indicating 

approval in the applicable system to State Office leadership through 

weekly or bi-weekly leadership calls.

September 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020

A notice will be issued identifying this finding and reiterating the 

applicable policy.

November 2019
SECTION II | OTHER INFORMATION

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PROGRAM: FSA ARC/PLC 

Root Cause (See Root Cause Table)  Insufficient Documentation to Determine

USDA’s Sub Root Cause 

• Form CCC-902, Continuation Sheet for 

Leased or Owned Land, was not on file.

• CCC-903 did not support the facts on 

CCC-902.

• County office did not document 

landowner's zero share on contract. 

• AD-1026, Highly Erodible Land 

Conservation (HELC) and Wetland 

Conservation (WC) Certification, was 

not on file prior to payment being 

issued.

• CCC-941, Average Adjusted Gross 

Income (AGI) Certification and Consent 

to Disclosure of Tax Information was 

not on file prior to payment being 

issued.

Amount Associated with the Root 

Cause (See Root Cause Table)  $354.18

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations.

August 2019

Deputy Administrators will reiterate the importance of following existing 

policies regarding signing and approving contracts before indicating 

approval in the applicable system to State Office leadership through 

weekly or bi-weekly leadership calls.

September 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020

A notice will be issued identifying this finding and reiterating the 

applicable policy. 

November 2019
USDA ANNUAL FINANCIAL REPORT | 2018 

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PROGRAM: FSA ARC/PLC 

 

Root Cause (See Root Cause Table)  Failure to Verify-Income Data

USDA’s Sub Root Cause 

• Unauthorized signature presented.

• Each producer's share in base acres 

was not supported by certified 

cropland on FSA-578, Report of 

Acreage. 

• CCC-903 documentation was not on 

file before payment was issued.

Amount Associated with the Root 

Cause (See Root Cause Table)  $7.56

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations.

August 2019

Deputy Administrators will reiterate the importance of following existing 

policies regarding signing and approving contracts before indicating 

approval in the applicable system to State Office leadership through 

weekly or bi-weekly leadership calls.

September 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied. 

January 2020

A notice will be issued identifying this finding and reiterating the 

applicable policy. 

November 2019
SECTION II | OTHER INFORMATION

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PROGRAM: FSA ECP HH 

Root Cause (See Root Cause Table)  Data Needed Does Not Exist

USDA’s Sub Root Cause 

• Data to support payment eligibility was 

not on file.

• Agricultural market value/cost-share 

per acre worksheet is not on file. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $0.11

Corrective Actions Completion Date

FSA will conduct National Conservation Program Training in late 2019 

and the root causes of improper payments will be stressed throughout 

several presentations reiterating the importance of issuing proper 

payments. Concurrently, an updated internal review process will be 

developed that will enable us to identify earlier the types of errors that 

are occurring, the underlying reasons, and communicate how policies 

and procedures should be applied. This will be reiterated through 

amended handbooks.

November 2019
USDA ANNUAL FINANCIAL REPORT | 2018 

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PROGRAM: FSA ECP HH 

Root Cause (See Root Cause Table)  Failure to Verify-Other Eligibility

USDA’s Sub Root Cause 

• Documentation to support participant 

eligibility was not on file. 

• Statement of producer's own 

contribution is not on file or is 

inadequate. 

• Cost-share agreement is not reviewed 

and/or approved by the applicable 

authority. 

• Cost-share payment is issued without 

AD-1026 on file.

• CCC-902 is not on file for participant 

receiving payment. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $0.55

Corrective Actions Completion Date

FSA will conduct National Conservation Program Training in late 2019 

and the root causes of improper payments will be stressed throughout 

several presentations reiterating the importance of issuing proper 

payments. Concurrently, an updated internal review process will be 

developed that will enable us to identify earlier the types of errors that 

are occurring, the underlying reasons, and communicate how policies 

and procedures should be applied. This will be reiterated through 

amended handbooks.

November 2019
SECTION II | OTHER INFORMATION

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PROGRAM: FSA ECP HH 

Root Cause (See Root Cause Table)  Administrative or Process Error Made by 

Federal Agency

USDA’s Sub Root Cause 

• Data entry errors occurred.

• Eligible cost of practice or component 

is calculated incorrectly.

• Ineligible cost is included in the 

calculation of cost-share earned. 

• Cost-share payment is issued for 

ineligible land. 

• Cost-share performance certification is 

not on file.

Amount Associated with the Root 

Cause (See Root Cause Table)  $1.53

Corrective Actions Completion Date

FSA will conduct National Conservation Program Training in late 2019 

and the root causes of improper payments will be stressed throughout 

several presentations reiterating the importance of issuing proper 

payments. Concurrently, an updated internal review process will be 

developed that will enable us to identify earlier the types of errors that 

are occurring, the underlying reasons, and communicate how policies 

and procedures should be applied. This will be reiterated through 

amended handbooks.

November 2019
USDA ANNUAL FINANCIAL REPORT | 2018 

8

PROGRAM: FSA ECP HH 

Root Cause (See Root Cause Table)  Insufficient Documentation to Determine

USDA’s Sub Root Cause 

• Documentation to support payment 

eligibility was not on file.

• Evidence to determine proper costshare payment is not obtained or is 

inadequate. 

• Cost-share performance certification 

and/or payment approval does not 

support practice and/or component 

extent performed. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $0.78

Corrective Actions Completion Date

FSA will conduct National Conservation Program Training in late 2019 

and the root causes of improper payments will be stressed throughout 

several presentations reiterating the importance of issuing proper 

payments. Concurrently, an updated internal review process will be 

developed that will enable us to identify earlier the types of errors that 

are occurring, the underlying reasons, and communicate how policies 

and procedures should be applied. This will be reiterated through 

amended handbooks.

November 2019
SECTION II | OTHER INFORMATION

9

PROGRAM: FSA LFP 

Root Cause (See Root Cause Table)  Data Needed Does Not Exist

USDA’s Sub Root Cause 

County offices are not following Livestock 

Disaster Assistance Program (1-LDAP) 

policy in regarding the requirement that 

an acceptable written lease, rental 

agreement, or CCC-855 Lease Certification 

Statement must be on file, and proper 

eligibility determinations documented 

prior to issuing payment.

Amount Associated with the Root 

Cause (See Root Cause Table)  $16.92

Corrective Actions Completion Date

National Livestock Disaster Program training was held in May 2019 and 

subsequent state training followed. The applicable policy requirements 

were discussed in detail along with examples. 

May 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020

Policy will be reiterated through amended handbooks and National 

training. 

November 2019
USDA ANNUAL FINANCIAL REPORT | 2018 

10

PROGRAM: FSA LFP 

Root Cause (See Root Cause Table)  Failure to Verify-Income Data

USDA’s Sub Root Cause 

• Payment Eligibility, Payment 

Limitation, and Average Adjusted 

Gross Income (5-PL) policy is not being 

followed.

• Average Adjusted Gross Income (AGI) 

Certification Statement and Consent to 

Disclosure of Tax Information (CCC941s) is not properly completed. 

• CCC-941 for all members of an entity 

is not completed prior to issuing a 

payment. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $2.49

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations.

August 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020

Policy will be reiterated through amended handbooks and National 

training. 

November 2019
SECTION II | OTHER INFORMATION

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PROGRAM: FSA LFP 

Root Cause (See Root Cause Table)  Administrative or Process Error Made by 

Federal Agency

USDA’s Sub Root Cause  Incorrect forage information was used to 

calculate payment. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $15.27

Corrective Actions Completion Date

Livestock Forage Disaster Assistance Program (LFP) software was 

updated in 2018 to integrate the Crop Acreage Reporting System 

(producer reported crop acreage data) into the LFP application system. 

Since this update was not complete until the later part of the 2018 

application year (FY 2019 reviews), this error should significantly be 

reduced in the FY 2020 review. 

October 2018

Conducted National Livestock Disaster Program Training in May 2019,

which covered the importance of foundational building blocks which 

included the farm records policies and procedures applicable to LFP and 

other disaster programs. 

May 2019

National Farm Records Training was conducted in August 2019 to clarify 

the system and policies in place for properly delineating acreage 

including ineligible acreage. 

August 2019

A “Quick Reference/Review” PowerPoint presentation will be 

developed. A plan is in place to work with the national farm records 

specialist to develop a power point presentation that will serve as a 

learning tool that each State can use. The presentation will stress the 

importance of ensuring county offices are following proper delineation 

policy in Farm Records and Reconstitutions Handbook (10-CM) and will 

be a quick refresher course on LFP implementation. 

January 2020

The CCC-770 LFP Checklist will be updated to help identify common 

errors prior to issuing payments. 

September 2019

A notice will be issued identifying these errors and the applicable policy 

will be reiterated.

November 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020
USDA ANNUAL FINANCIAL REPORT | 2018 

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Corrective Actions Continued for LFP Completion Date

Program managers, compliance division, and program delivery branch 

are in the process of identifying areas where software can be enhanced 

to mitigate these errors, policy clarified, and training provided. NOTE: 

Software enhancements are contingent upon budget. 

September 2020

PROGRAM: FSA LFP 

Root Cause (See Root Cause Table)  Insufficient Documentation to Determine

USDA’s Sub Root Cause 

• Acreage and Compliance 

Determination (2-CP) policy on proper 

steps to accept and document late 

filed Report of Acreage (FSA-578) was 

not followed.

• Payment Eligibility, Payment 

Limitation, and Average Adjusted 

Gross Income (5-PL) policy on the 

proper completion of Farm Operating 

Plan (CCC-902) was not followed.

• County Committee determinations 

(CCC-903) was not filed prior to 

payment being issued. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $52.86

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations. 

August 2019

A notice will be issued identifying these errors and referencing 

applicable policy. 

November 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020
SECTION II | OTHER INFORMATION

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PROGRAM: FSA NAP 

Root Cause (See Root Cause Table)  Data Needed Does Not Exist

USDA’s Sub Root Cause 

• FSA field employees are not following 

handbook 1-NAP (Rev. 2) policy 

regarding the requirement that an 

acceptable written lease or rental 

agreement and proper eligibility 

documents are provided prior to 

issuing payment. 

• Sufficient information was available to 

determine the participant's eligibility 

(based on staff or County FSA 

Committee (COC) knowledge) to 

receive payment; however, it was not 

documented sufficiently. 

Amount Associated with the Root 

Cause (See Root Cause Table)  $1.62

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations. 

August 2019

The use of the CCC-855 for assistance in documenting lease or rental 

arrangements will be incorporated into NAP policy with the next 

handbook amendment. 

September 2019

A notice will be issued identifying the applicable errors and referencing 

policy.

November 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020
USDA ANNUAL FINANCIAL REPORT | 2018 

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PROGRAM: FSA NAP 

Root Cause (See Root Cause Table)  Failure to Verify-Income Data

USDA’s Sub Root Cause 

FSA field employees are not following 

handbook 5-PL policy and requiring the 

participant to complete CCC-941s 

(Adjusted Gross Income certification) or 

getting a CCC-941 for all members of an 

entity prior to issuing a payment.

Amount Associated with the Root 

Cause (See Root Cause Table)  $0.18

Corrective Actions Completion Date

National NAP Train-the-Trainer training was conducted in August 2019. 

Field office staff were trained on the importance of producer 

certification supporting documentation, and it being on file before the 

automated system is updated. 

August 2019

A notice will be issued identifying this error and reiterating the 

applicable policy.

November 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020
SECTION II | OTHER INFORMATION

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PROGRAM: FSA NAP 

Root Cause (See Root Cause Table)  Failure to Verify-Other Eligibility

USDA’s Sub Root Cause 

• Handbook 5-PL policy which requires 

participants to complete the required 

CCC-902, Producer Farm Operating 

Plan is not being followed.

• Documenting the determination on 

the CCC-903, County FSA Committee 

(COC) determination is not being done.

Amount Associated with the Root 

Cause (See Root Cause Table)  $0.20

Corrective Actions Completion Date

National Farm Bill training was held August 5-9, 2019 in Phoenix that 

addressed improper payment findings. Root causes of improper 

payments were stressed throughout several presentations. 

August 2019

Software currently does not read the validity of the CCC-903 to meet 

the payment eligibility requirements. Software enhancements are being 

discussed to require the Business File records to be read during the NAP 

payment process. 

March 2020

National NAP Train-the-Trainer training was conducted in August 2019. 

Field office staff were trained on the importance of producer 

certification supporting documentation, and it being on file before the 

automated system is updated.

August 2019

A notice will be issued identifying this error and reiterating the 

applicable policy.

November 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020
USDA ANNUAL FINANCIAL REPORT | 2018 

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PROGRAM: FSA NAP 

Root Cause (See Root Cause Table)  Administrative or Process Error Made by 

Federal Agency

USDA’s Sub Root Cause 

Payment was processed despite lack of 

sufficient documentation to justify the 

participant's eligibility to receive payment.

Amount Associated with the Root 

Cause (See Root Cause Table)  $18.03

Corrective Actions Completion Date

The Agency will begin requiring the completion of the CCC-770 NAP 

Checklist prior to issuing a NAP payment. Currently, the completion of 

the CCC-770 NAP is discretionary. This form requires two employees to 

review all documents associated with a payment before it is issued.

September 2019

National NAP Train-the-Trainer training was conducted in August 2019. 

Field office staff were trained on the importance of producer 

certification supporting documentation, and it being on file before the 

automated system is updated. 

August 2019

A notice will be issued identifying these errors and reiterating the 

applicable policy.

November 2019
SECTION II | OTHER INFORMATION

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PROGRAM: FSA NAP 

Root Cause (See Root Cause Table)  Insufficient Documentation to Determine

USDA’s Sub Root Cause 

Documentation was not sufficient to 

justify the participant's eligibility to receive 

payment.

Amount Associated with the Root 

Cause (See Root Cause Table)  $22.45

Corrective Actions Completion Date

National NAP Train-the-Trainer training was conducted in August 2019. 

Field office staff were trained on the importance of producer 

certification supporting documentation, and it being on file before the 

automated system is updated. 

August 2019

A notice will be issued identifying these errors and reiterating the 

applicable policy.

November 2019

Internal reviews will be conducted by FSA’s Office of Management and 

Strategy. The new internal review process will enable us to identify 

earlier the types of errors that are occurring, the underlying reasons, 

and communicate how policies and procedures should be applied.

January 2020
USDA ANNUAL FINANCIAL REPORT | 2018 

18

Improper Payments Root Causes Table ($ in Millions)

OverpaymentsUnderpaymentsOverpaymentsUnderpaymentsOverpaymentsUnderpaymentsOverpaymentsUnderpayments

Inability to Access Data

Data Needed Does Not Exist 16.92 1.62 0.11

Death Data

Income Data 2.49 0.18 7.56

Excluded Party Data

Prisoner Data

Other Eligibility [Note #1] 0.20 0.55

Federal Agency 13.79 1.48 17.98 0.05 249.6 0.66 1.53

State and Local Agency

Other Party

52.86 22.45 354.18 0.79

86.06 1.48 42.43 0.05 611.34 0.66 2.98

Note #1: Failure to verify other eligibility includes program eligibility not being verified.

FSA Harvey-ECP

Note #2: USDA uses the OMB Circular A-123, Appendix C root cause matrix in the AFR, which considers insufficient documentation to determine an overpayment. In OMB 

Circular A-136, insufficient documentation to determine is considered “unknown”, rather than an overpayment. Please go to the Monetary Loss Breakdown Table to see the 

amount of USDA’s improper payments attributed to the “unknown” category.

Failure to Verify

Administrative 

or Process Error 

Made By

Medical Necessity

Insufficient Documentation to Determine [Note #2]

Other Reason

TOTAL

Reason for Improper Payment

FSA LFP FSA NAP FSA ARC/PLC

Program design or Structural Issue

Inability to 

Authenticate 

Eligibility