Agriculture's Statistics Agency:

--Computation of Average Market Price of Rice Questioned--Independent Evaluation and Unimpeded GAO Access to Records Needed

CED-79-85: Published: Jun 25, 1979. Publicly Released: Jun 25, 1979.

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The Department of Agriculture's (USDA) Economics, Statistics, and Cooperatives Service needs to develop better price data for determining the national average market price farmers will receive for rice as the data are used to calculate federal deficiency payments. Neither the program's authorizing legislation nor its legislative history indicates how the average price should be determined.

The Service has not provided its state statistics offices with adequate written procedures for compiling data and maintaining records. The cost of drying green rice, an important factor, was omitted in determining the price farmers receive for their rice and caused deficiency payments to be about $10.6 million more than otherwise would have been for the 1976 crop and $5 million more for the 1978 crop. GAO asked the Service to provide workpapers and reports so that it could evaluate how the reports were used to determine the average price farmers received for the 1976 crop. The Service and USDA denied GAO access to the reports for about a year. After GAO questioned the Service's computations, the Service revised the figures and an $11 million savings were realized.

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