If you filed a successful claim in connection with the genetic problems of StarLink seed corn several years ago, reimbursement is on the way. Extension agricultural law specialist Don Uchtmann reports the payment rate will be approximately $2.75 per acre. That was calculated from the nearly 29 million acres of corn accepted by the federal court from all of the claims filed by farmers who suffered price deterioration because of StarLink contamination.

The successful claimant will first receive a notification letter indicating that the claim has been accepted, and then directing the claimant to watch for a Prepaid Visa" Direct Card which will arrive in the mail. The card will be mailed by BankOne and may resemble a credit card application, so examine it thoroughly to ensure it is not discarded inadvertently.

Extension specialist Don Uchtmann says, "The value stored on a Prepaid Visa" Direct Card is the Farm Operator's share of the total settlement. For "Corn Loss" claims, it is based on the eligible corn acres included in the claim. The prepaid Direct Cards will be usable for the actual cash value stored on the card wherever Visa Debit cards are accepted. They also will be redeemable in cash at banking institutions, subject to the bank's normal fee for such transactions. When used at a Tractor Supply Co. store, the user will receive an additional 10% discount (subject to certain restrictions). Details will accompany your notice letter. Watch for any time limitations for using the cards, such as an expiration date within 365 days after the card was issued. Such a time limit was described in the Settlement Enhancement Program as proposed (see www.non-starlinkfarmerssettlement.com)."

If the operator receives the StarLink reimbursement, Uchtmann says he has the obligation to share the payment with the landowner, or any others who may have a legal interest in the land, as indicated by the following examples:

1) If Landlord A were entitled to 50% of the year 2000 corn as rent, he would be entitled to 50% of the Operator's settlement payment for Farm A. 2) If Landlord B were entitled to one-third of the crop as rent, she would be entitled to one-third of the settlement payment for Farm B. In both cases, Operator would make the appropriate payment to the landlord, including an explanation. 3) If Landlord C "cash rented" Farm C to Operator, and Landlord C had no interest in the crop grown, then Landlord C would not be entitled to any share of Operator's settlement payment for Farm C.

The StarLink payment is also taxable according to Uchtmann. If it is received in 2004, it would reported as 2004 income. If the funds are used to purchase farm supplies or equipment, they can be deducted as a business expense, but the income is still reported as income. If the operator has to provide 50% of the income to the landlord, then the payment to the landlord is a deductible expense.

For more details on StarLink:

http://www.farmdoc.uiuc.edu/legal/articles/ALTBs/ALTB_04-12/ALTB_04-12.pdf