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in category two and category three, using an assumed market price
of $950 in 1987 and $1,050 in 1988 and 1989, and an assumed
expansion of 1,500 head. Petitioner planned to enlarge its herd
but was forced to postpone its plans because the dike failed in
October 1988.
The SCS designed the environmental system to accommodate the
largest permissible herd on petitioner's land. The maximum
number of cows that petitioner could have on its existing land
was 5,500. Thus, the limit on herd size in response to
petitioner's animal waste problems does not show that petitioner
did not want to increase its herd. Petitioner's accumulation for
herd expansion in 1989 was reasonable because petitioner did not
know at the end of fiscal year 1989 that it would have to limit
the size of its herd.
Petitioner had definite and specific plans to expand its
herd in 1987, 1988, and 1989, and reasonably accumulated
$1,425,000 in 1987 and $1,575,000 in 1988 and 1989 for this
purpose.
b. Pollution Control
Petitioner contends that it reasonably accumulated $50,000
in fiscal year 1987, $550,000 in fiscal year 1988, and $1,000,000
in fiscal year 1989 for pollution control and improvements to its
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