Two bills introduced in Congress would make farm and ranch partnerships eligible for loans provided by the Paycheck Protection Program (PPP).
Congress made improvements to PPP in the Consolidated Appropriations Act of 2021, stating farmers and ranchers who file a Schedule F with their tax return are eligible with gross income rather than wages. However, producers who operate as a partnership or sole-owner limited liability corporations were being denied by the Small Business Administration (SBA).
Introduced by Reps. Ron Kind (D-WI-3) and Jeff Fortenberry (R-NE-1), the Paycheck Protection Clarification for Producers Act would address that issue and increase the amount producers receive from PPP by allowing SBA to use gross income to calculate the loan award.
“Our family farmers are facing tough times through no fault of their own as the COVID-19 crisis continues,” said Kind in a statement. “That’s why I’ve continued to fight to expand access to the PPP and other relief programs for our hardworking agricultural producers. No farmer should be shut out of this crucial program and denied a financial lifeline because of an interpretation error, and I’m proud to introduce bipartisan legislation to right this wrong.”
A similar bill was introduced by Rep. Jim Hagedorn (R-MN-1) and cosponsored by 61 members of the House of Representatives. The PPP Flexibility for Farmers and Ranchers Act would enable farmers and ranchers to report either gross or net income to calculate their maximum PPP loan.
The bill was previously introduced as an amendment to a House Small Business Committee markup in February, but was voted down in an en bloc amendment 9-14, which contained the measure. Hagedorn’s amendment was supported by corn, soybean, pork, beef and poultry producers in Minnesota and the Minnesota Farm Bureau Federation (MFBF).
“The PPP provides valuable financial assistance to Minnesota farmers and ranchers,” said Kevin Paap, president of MFBF. “While many self-employed farmers were initially blocked from getting loans, Congress solved the problem for most by amending the program, so they qualified based on gross income. However, that fix didn’t include farmers in partnerships. MFBF commends Rep. Hagedorn for expanding PPP eligibility for farm partnerships.”
Both bills also garnered the support of the American Farm Bureau Federation (AFBF), with the agency stating they will clarify “Congress’ intent to allow all self-employed farmers and ranchers to access PPP loans.”
AFBF President Zippy Duvall sent a letter to sponsors of both bills stating, “The PPP is currently providing valuable assistance to many farmers and ranchers who are struggling to navigate financial challenges caused by the COVID-19 pandemic. But in a departure from congressional intent, not all self-employed farmers and ranchers can access this important program.”
Both bills were introduced in the House of Representatives in late February and sent to the House Committee on Small Business. — Charles Wallace, WLJ editor
