Update as of Friday April 24: The House of Representatives passed the new coronavirus stimulus bill and President Donald Trump signed it.
After funds ran out for small business aid within two weeks of being announced, an additional round of funds will replenish small business aid programs, as well as fund hospitals and expand testing.
A total of $484 billion in relief was included in a new coronavirus stimulus bill that passed the Senate on April 21 and was expected to pass the House of Representatives April 23, after WLJ press time. President Donald Trump expressed his support for the bill and was expected to sign it shortly after.
Of the funding, $370 billion was allocated toward loan programs for small businesses. The Paycheck Protection Program (PPP) will receive $310 billion and the remaining $60 billion will be destined for the Economic Injury Disaster Loan program (EIDL).
The additional funding was commended by the National Cattlemen’s Beef Association (NCBA).
“We applaud the Senate for advancing this critical replenishment of funding to programs like PPP, and we are pleased to see the reaffirmation of Congress’s intent that cattle producers be granted access to the EIDL program administered by the Small Business Administration (SBA),” said NCBA Vice President of government Affairs Ethan Lane.
Authorizing language was added to allow agricultural businesses with less than 500 employees to also be eligible for EIGL grants and loans.
The PPP was created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the initial $350 billion allocated to the program ran out within days of the application process opening.
Farmers are eligible for PPP and will need to be quick to apply for funds in the latest round of aid, in the event that money rapidly runs out again. Applicants will need to apply through an eligible financial institution, who will then submit the application to the SBA.
To find out if you are eligible for a loan and to find a list of eligible lenders, visit www.sba.gov.
USDA additional aid
USDA has also announced it will provide $16 billion in direct aid to farmers and ranchers and $3 billion in agriculture purchases.
“We worked hard to provide USDA with additional resources to help our farmers and ranchers through this tough stretch, including $9.5 billion in emergency funding specifically for our ranchers and other specialty producers,” said Sen. John Hoeven (R-ND), chairman of the Senate Agriculture Appropriations Committee.
The $19 billion Coronavirus Food Assistance Program (CFAP) will fund $16 billion in direct payments using the $9.5 billion included in the CARES Act and $6.5 billion in Credit Commodity Corporation (CCC) funding. CFAP will also include $3 billion in purchases of agriculture products, including meat, dairy and produce. The products will be distributed to food banks and other organizations that provide food to those in need.
A total of $9.6 billion in direct payments was allocated to the livestock industry, with $5.1 billion to cattle producers, $2.9 billion to dairy producers, and $1.6 billion to hog producers. The remaining funds will be allocated to crop producers.
Commodities must have experienced a 5 percent price decline between January and April.
Producers will receive a single payment determined by two calculations. Price losses must have occurred between January and April 15 and producers will be compensated for 85 percent of losses during that period. The second part of the payment will be derived from expected losses from April 15 through the next two quarters, and will cover 30 percent of expected losses. Payment limits are capped at $125,000 per commodity, with a limit of $250,000 per individual or entity.
[inline_image file=”9c721e8069a448482cc070a753c6ca58.jpg” caption=”Training cattle to eat noxious weed; a Madison County pest management project.”]
Regarding the payment limitations, Lane said, “The low payment cap of $125,000 per commodity will prevent many operations, large and small, from receiving enough assistance to soften this blow. The proposed anticipated loss payment formula for cattle will also leave many producers, including a large percentage of the cow-calf sector, out in the cold. We do not believe this was USDA’s intent, but recognize we are in uncharted territory for the cattle industry with this type of assistance. As such, we feel it is critical to continue providing feedback from our producers across the country to USDA.”
Specifics for how farmers and ranchers may qualify for CFAP have yet to be determined.
“The assistance for farmers and ranchers must be distributed quickly and fairly, with enough safeguards to assure it reaches the appropriate people,” said California Farm Bureau President Jamie Johansson. “We understand that can be a difficult balance, and we will continue to offer USDA our best advice on how to make this aid package as effective as possible for farmers, ranchers and all the people who depend on them.”
USDA expects signups to begin for the new program in early May and to have payments out to producers by the end of May.
“While this program is an important down payment in making agriculture whole from the unprecedented and unexpected economic fallout related to COVID-19, more help will be needed as the full extent of the crisis becomes known,” read a statement by the American Farm Bureau Federation. — Anna Miller, WLJ editor
“The proposed anticipated loss payment formula for cattle will also leave many producers, including a large percentage of the cow-calf sector, out in the cold.”
“The assistance for farmers and ranchers must be distributed quickly and fairly, with enough safeguards to assure it reaches the appropriate people.”
