OBBBA Strengthens ARC and Adds One-Year “Higher-Of” ARC/PLC Protection

Lamson Dugan & Murray LLP is tracking significant changes for producers following the passage of OBBBA. For the 2025 crop year, USDA will pay the higher of ARC-CO or PLC for each covered commodity. This one-year provision reduces the risk of locking into the “wrong” program during volatile markets.

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In addition, ARC is strengthened: the revenue guarantee increases to 90% and the payment band widens to 12%. Updates to statutory reference prices also adjust the underlying price floors that inform PLC triggers and ARC benchmarks over time.

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What producers should consider

• Model ARC vs. PLC side-by-side—even with “higher-of,” your 2026 election still matters.
• Coordinate ARC/PLC choices with crop insurance to avoid coverage gaps or overlaps.
• Keep strong yield and basis documentation to support decisions and potential payments.

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Questions about how these changes impact your operation? Talk to an attorney today.