This is Rhizoctonia ( Rhizoctonia solani ). It is a soilborne fungus that causes decay in potato stems and seed pieces.
Management:
1. Use a crop rotation with corn, grasses, and cereal grains. If this disease has been severe, three to five years should elapse between potato crops.
2. Plant certified seed tubers that are free of Rhizoctonia on the skin.
3. Use planting practices that promote rapid emergence. Avoid planting in heavy, poorly drained soils. Plant seed potatoes when soil is warm (above 60 degrees F). Cover seed tubers with no more than 2 inches of soil.
4. Harvest tubers promptly after vines are dead to avoid the development of sclerotia (over-wintering fungal form) on the surfaces of tubers while still in the soil. Contact your local County Extension office for more information on potato diseases.
You can also refer to the following factsheet from Cornell: Rhizonctonia Disease of Potato.
