Page 37

allotment. Refer to IX. below for determining if the property meets the 6% income test. g. If an individual rents his tobacco allotment to someone else, consider the rental payment as annual rental income. Prorate for 12 months to determine monthly income. 8. The Tobacco Transition Payment Program (TTPP) On October 22, 2004, Congress enacted the “Fair and Equitable Tobacco Reform Act of 2004” which repealed the tobacco quota system for certain types of tobacco grown in the United States and provides for compensating tobacco quota owners and quota growers with the value of lost quota. USDA established the Tobacco Transition Payment Program (TTPP), also known as the Tobacco Buy-Out. TTPP allowed eligible quota owners and quota growers who apply for the program to receive annual installment payments over a 10 year period (2005-2014) as compensation. The TTPP does not provide a lump sum payment instead of the installment payments, however effective October 14, 2005, it allows the quota owner/grower to enter into an assignment or successor-in-interest contract with an approved financial institution and receive a discounted cash payment in exchange for the installment payments. The successor-in-interest option to sell to a family member was effective March 20, 2006. Note: An individual could have multiple contracts if he owned quota or grew eligible tobacco in different counties. Follow these procedures for the quota owners/growers participating in the TTPP: a. Determine if the balance of the tobacco allotment contract can be sold to an approved financial institution for a lump sum cash payment. Contact one of the approved financial institutions listed on the National Tobacco Processing Center Participant List website at: http://www.fsa.usda.gov/Internet/FSA_File/siimasterlist2007.pdf and document the following. (1) Quota Type, Grower or Owner (2) Name of TTPP Contract Holder (3) Financial Institution Contacted (4) Date of Contact (5) Name/Title of Individual Contacted (6) Telephone Number (7) Outcome- Whether Contract is Salable or Not Salable The caseworker must document this information in the record. 37