UPDATED: USDA Rolls Out Supplemental Disaster Relief Program Stage 2
New phase targets uninsured, unindemnified, and quality losses for 2023–24 disasters
USDA’s Farm Service Agency (FSA) has released detailed guidance for Stage 2 of its Supplemental Disaster Relief Program (SDRP) — a major assistance effort created under the American Relief Act of 2025. The program is designed to deliver more than $16 billion in support to producers hit by severe weather-related losses during calendar years 2023 and 2024. Link to questions/answers.
Note: As of Nov. 2, USDA has paid out $5.7 billion for Stage 1. If that $5.7 billion is current, that would leave $10.37 billion for Stage 2.
Of note: While Stage 1 delivered payments based on losses already indemnified by federal crop insurance or the Noninsured Crop Disaster Assistance Program (NAP), Stage 2 expands assistance to include uninsured, shallow, and non-indemnified losses, along with quality degradation and tree, bush, and vine losses.
A Two-Stage Structure for Broad Producer Relief
Stage 1: Indemnified Losses
Stage 1 relied on data from existing crop insurance or NAP claims to calculate payments, providing a streamlined approach for producers whose losses were already documented.
Stage 2: Uncovered & Non-Indemnified Losses
The newly announced Stage 2 targets producers who suffered losses not covered by existing programs. This includes:
- Crops, trees, bushes, and vines without indemnity coverage
- Shallow or uncovered losses
- Quality loss adjustments
- Lost acreage or production not captured in Stage 1
Stage 2 also offers premium and fee refunds for insured or NAP-covered producers when a calculated payment is greater than zero.
According to the fact sheet, Stage 2 is built to maintain consistency with Stage 1 calculations by using available insurance or NAP data, while relying on FSA acreage and production records for uninsured crops.
Eligible Disaster Events and Geographic Scope
To qualify, losses must have resulted from USDA-recognized disaster events occurring in 2023 or 2024, including:
- Wildfires
- Hurricanes, tropical storms, and storm surges
- Floods and silt/debris damage
- Derechos
- Tornadoes
- Winter storms, blizzards, freeze events, and polar vortex conditions
- Excessive heat and moisture
- Smoke exposure
- USDA-defined drought (D2 for 8 consecutive weeks, or D3+)
A full list of drought-eligible counties is available via USDA’s SDRP portal.
Notably, Connecticut, Hawaii, Maine, and Massachusetts will not participate in SDRP payments, as each is receiving separate state block grants for producer compensation.
Who Is Eligible
Eligible applicants include:
- U.S. citizens or resident legal aliens
- Legal entities organized under state law
- Tribes and tribal organizations
- Producers who share in ownership and production risk
Standard FSA eligibility documents — such as AD-2047, CCC-902, CCC-901, acreage reports, HELC/WC certification, and direct-deposit forms — must be on file.
Accounting for Quality Losses
For the first time in the SDRP framework, Stage 2 explicitly compensates for quality degradation, using two methods:
1. For Non-Forage Crops
Quality loss is determined by discounts at the point of sale due to grade reductions, physical deterioration, or other quality factors.
2. For Forage Crops
Quality adjustments are based on feed-value metrics such as:
- Relative Feed Value (RFV)
- Total Digestible Nutrients (TDN)
FSA will use established NAP quality measurement ranges. Producers must provide verifiable documentation supporting quality loss percentages.
How to Apply
Producers must complete and submit Form FSA-504 for Stage 2 through:
- In-person delivery
- Fax
- Electronic submission (Box/One-Span)
FSA leverages insurance, NAP, or acreage reporting data already on file. Missing data must be supplied at enrollment.
How Payments Are Calculated
SDRP Stage 2 payments are tied to the coverage level purchased under crop insurance or NAP. Uninsured producers receive a default adjusted SDRP coverage level of 70%.
Examples of adjusted SDRP coverage levels include:
- Catastrophic crop insurance → 75%
- 70–75% insurance → 90%
- 80%+ insurance → 95%
- NAP 65% coverage → 95%
- Uninsured → 70%
For insured or NAP-covered crops, net indemnities (after fees/premiums) are subtracted from the final SDRP-calculated payment. A 35% SDRP payment factor applies to all payments.
Payments across Stage 1 and Stage 2 for indemnified producers cannot exceed 90% of total loss.
Payment Limits and AGI Rules
SDRP uses a three-tier structure based on farm income:
Standard Limit
- $125,000 per year for 2023, 2024, and/or 2025
Producers qualify if less than 75% of their AGI comes from farming, ranching, or forestry.
Increased Limit for Farm-Derived Income
If ≥75% of AGI is farm-derived, producers may qualify for higher limits:
- $900,000/year for specialty and high-value crops
- $250,000/year for all other crops
Eligible producers must file FSA-510 with CPA or attorney certification.
Future Insurance Requirement
All producers receiving SDRP payments must purchase federal crop insurance or NAP coverage at 60%+ for the next two available crop years. Failure to do so results in repayment of SDRP assistance with interest.
Looking Ahead
USDA is maintaining a centralized Supplemental Disaster Assistance landing page, allowing producers to track:
- National rollout timelines
- State disaster block grants
- SDRP application windows
- Farm program tools such as Disaster-at-a-Glance and the Disaster Assistance Discovery Tool
As extreme weather events continue to reshape production risk across U.S. agriculture, SDRP Stage 2 offers a more comprehensive compensation model — capturing uninsured losses, quality deterioration, and specialty-crop impacts that often escape traditional programs.
