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Abstract
A rapidly changing business environment has dictated a need for farmers to
improve their risk management skills. The 1996 Federal Agricultural
Improvement and Reform Act (FAIR) also created a new environment for
American farmers by eliminating planting restrictions and deficiency payments.
Congress recognized the changing environment by mandating the Secretary of
Agriculture to initiate a risk management education program. A memorandum of
understanding specified the responsibilities of the federal agencies involved in
risk management services and education. A work group representing all public
and private organizations concerned with risk management services and
strategies was convened. The work group established a set of objectives, the five
major areas of risk to address and an overall educational plan. Five regional
extension coordinating offices were established to coordinate activities with
federal agencies and the private sector and to distribute funding for extension
based educational programs. The initiative originally received funding of $5M in
1997. In 2000, the Agricultural Risk Protection Act, which primarily revised the
crop insurance program, provided an additional $5M for risk management
education for the 2001 fiscal year and the succeeding four years. The initiative
has provided an impetus to look a risk management in a broad and
comprehensive manner. This has resulted in the development of very creative and
innovative programs, in terms of materials and methods of delivery. The working
partnerships between public and private sector organizations have been a key to
the success of the programs.