CAIS Inventory Transition Initiative (CITI)

CITI is a one time federal government injection of $900 million into Canada’s Agriculture and Agri-food industry. The funds will be delivered to producers by recalculating how the Canadian Agricultural Income Stabilization (CAIS) program values inventory change for the 2003, 2004, and 2005 CAIS program years.

Producers do not need to apply for a payment. CAIS information that producers have already submitted for 2003, 2004 and 2005 will be used to recalculate benefits using a new method of inventory valuation. If producers are entitled to more money after the recalculation, they will receive additional payments. Recalculations will be done beginning with the 2003 program, followed by 2004 and finally 2005.

Payments are expected to be delivered to eligible producers starting this fall.

NEW:

2006-12-05 - Fact Sheet ( PDF )
2006-07-06 - Industry Advisory

BACKGROUND

CAIS Inventory Transition Initiative (CITI) payment

Producer payments for CAIS will be recalculated for each of the 2003, 2004 and 2005 programs using a new method for valuing inventory change. If producers are entitled to more money after the recalculation, they will receive a CAIS Inventory Transition Initiative (CITI) payment. Payments will be issued as applications for each program year are recalculated.

Payments are expected to be delivered to producers beginning this fall and delivery of payments for all program years is expected to be complete in early 2007. Producers do not need to apply. Federal and provincial CAIS administrations will deliver funds based on information which producers have already submitted for the program.

To ensure that payments do not exceed the $900 million spending cap, payments will be recalculated and producers will receive a percentage of the total payment. Further details on payment percentages will be available in the coming weeks.

How the new inventory valuation method works

As a transitional measure to more responsive programs in 2007, the method for calculating inventory changes is being amended so that losses in inventory values caused by declining commodity prices are reflected in a producer's payment.

Currently, changes in inventory quantities (e.g. for livestock, grain, horticulture crops and other commodities) are valued using a year end price.

With the new inventory valuation method, an opening price (P1) and an end of year price (P2) will be used to value inventory. The decline or increase in value of inventory will be included in the calculation of a producer's production margin (i.e. farm income) for the year. This method will be applied to market commodities but will not be applied to productive assets such as breeding livestock.

If producers are entitled to more money after the recalculation, they will receive additional payments. Recalculations will be done beginning with the 2003 program, followed by 2004 and finally 2005.

Payments

Payments will be delivered to producers beginning this fall. 2003 and 2004 CAIS program years will be recalculated and funds delivered to producers by the end of the year. CAIS applications for the 2005 program year will be recalculated and funds delivered in early 2007, as the majority of 2005 final applications will not be received until the late fall of 2006.

Government contributions under CITI are limited to an individual payment of $500,000 for each program year. A participant’s total payment cannot exceed the overall CAIS payment cap of $3,000,000 or 70% of a program year margin decline, from CITI and CAIS for each program year.

Appeals

If producers have a current CAIS appeal related to inventory valuation, the Administration will be contacting them and asking if they wish to continue with their appeal.

Adjustments

Your CITI payment will be calculated based on the information previously provided to the CAIS Administration to calculate your CAIS benefits. The CITI recalculation cannot be used as an opportunity to make adjustments to information on prior years. You may request an adjustment to the information reported on the CAIS program forms by submitting a written request to the CAIS administration within 90 days of the date indicated on your original Calculation of Program Benefits. Adjustments requested after this time will not result in any changes to CAIS and CITI payments for that program year.

Overpayments

The collection of CAIS overpayments and interest on overpayments has been deferred until January 2007. This is to ensure that producers do not repay a CAIS overpayment and then receive a CITI payment shortly after. However, if you are in an overpayment situation, your CITI payment will be used to reduce or eliminate that overpayment.

The deadlines to participate in CAIS 2003 and 2004 have passed. September 30th is the deadline to file your 2005 CAIS Harmonized form

There is no intent to re-open the CAIS program (for 2003,2004,2005) to new applicants as participation in each of the last three program years has been high. Producers are encourage to apply for CAIS in 2006.

For more information, please call 1-866-367-8506

The CAIS program is delivered in British Columbia, Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Newfoundland and Labrador and Yukon by the federal government. The information on this website refers to deadlines and other delivery details for these provinces only.

If you are in Alberta, Ontario, Quebec, or Prince Edward Island, the CAIS program is delivered provincially. Please click on your respective province to be linked to the provincial administration.

Date Modified: 2006-12-06		Important Notices
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