Second COVID-19 stimulus bill provides $13 billion for ag programs
After months of negotiations, Congress on Dec. 21 passed a $900 billion COVID-19 stimulus package with much-needed financial relief for agricultural producers, funding for food assistance programs, enhancements to the Paycheck Protection Program and funding for expanded broadband access, as well as additional financial resources for agricultural research and farmer stress assistance programs, among other things.
The package provides an estimated $13 billion directly to agricultural programs, with $300 million allocated to the Commerce Department for assistance to fisheries. An article from American Farm Bureau Federation economists highlights many of the direct agricultural provisions in the bill. Here are some key provisions in the bill.
The bill provides $11.2 billion to the USDA to support agricultural producers, processors, and contract growers impacted by coronavirus, including:
• Supporting producers of non-specialty crops (corn, wheat, etc.) by providing a payment in the amount of $20 per planted acre of such commodities. This payment is a supplement to the Coronavirus Food Assistance Program (CFAP 2) which only covered 80% of the price loss due to coronavirus impacts on a portion of the crop marketing for each commodity (40% for corn);
• Specialty crop producers can include crop insurance indemnities and disaster payments in their 2019 sales, which was the basis for determining the amount of support under CFAP 2, or by substituting 2018 sales;
• Indemnifies losses for producers who had to depopulate their animals due to insufficient processing capacity at a rate of 80% of the fair market value of the animal plus the cost to depopulate, after accounting for other support producers received under EQIP or from the states;
• Provides an inventory top-up payment to cattle producers to address a portion of the gap in support provided by both CFAP 1 and CFAP 2 to producers who sold cattle before April 15 and those who sold after;
• Supports up to 80% of lost revenue for contract growers who were affected by canceled or delayed contracts;
• Supports textile mills which are the primary domestic users of cotton and have seen retail clothing sales significantly impacted by coronavirus stay at home orders;
• Provides support for animal disease prevention and response capacity;
• Allows the Agriculture Secretary to extend the term of marketing loans by three months, providing producers additional time to repay;
• Provides resources for additional commodity and food purchases and grants/loans for additional assistance for producers, processors, and other agricultural entities to respond to coronavirus, including measures to protect workers;
• Gives discretion to the Agriculture Secretary to support timber harvesting and hauling businesses;
• Allows the Agriculture Secretary to account for price differentiation (i.e. higher prices for organics) when calculating assistance;
• Gives discretion to the Agriculture Secretary to support domestic biofuels producers;
• Directs the Agriculture Secretary to provide additional assistance to producers of specialty crops, livestock and dairy that had payments under CFAP 1 and 2 reduced by arbitrary payment caps, leaving significant losses uncovered by the original programs.
Additional provisions delivered by the Department of Agriculture:
• Support for the Specialty Crop Block Grants Program, the Local Agriculture Market Program, the Farming Opportunities Training and Outreach Program, and the Gus Schumacher Nutrition Incentives Program;
• Support for the Agricultural Research Service to address gaps in nutrition research.
• Supplemental coverage under the Dairy Margin Coverage program for dairies under 5 million pounds that have production left uncovered by the current safety net;
• Establishes a Dairy Donation Program for dairy organizations that establish a partnership with a non-profit distributor and provides $400 million for reimbursement of donated dairy products to the partner non-profit distributor;
•Establishes a livestock statutory dealer trust to give unpaid sellers of livestock priority in collecting receivables in the event of a dealer default.
• Establishes a grant program for small meat and poultry processors to upgrade operations in order to move to federal inspection or a state inspection program that allows for the sale of products across state lines.
• Establishes a grant program to allow state departments of agriculture to supplement ongoing farm stress initiatives.
• Includes funding to offset the loss resulting from the coronavirus pandemic of quarantine and inspection fees collected to ensure agriculture quarantine inspection activities continue.
For more details on the stimulus bill and other funding measures passed by Congress, visit https://gfb.ag/AFBFC19stimsum.