The Evolution and Expansion of Risk Management Education Programs in the United States

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.