The Rowe Report: Second Round of CFAP Aid Comes at Critical Time for Farmers

Ben Rowe, National Affairs Coordinator

There is a strong chance you are reading this article from the same place that I am writing it: the kitchen table. For farmers, doing paperwork and running their business from the home office or kitchen table isn’t anything new, but for millions of Americans now working from home for the first time, it is quite the transition. The kitchen table is an appropriate place to do some reflecting because, for many Americans, access to the food we serve on those tables hasn’t changed that much. There were some temporary supply-chain disruptions in the late-spring, pick up and home delivery have grown, and income-related hunger issues have been exasperated by the economic crisis, but on the supply side, things look very normal.

Farms are continuing to raise livestock and harvest crops, the supply chain remains resilient, new food assistance programs are helping get food to the needy, and consumer prices are relatively stable despite enormous headwinds. This has not happened by accident. Five months ago, the Coronavirus Food Assistance Program (CFAP) was announced to provide aid to America’s food producers, and this week the federal government announced CFAP2 to ensure farmers remain viable and the abundance and affordability of food persists.

The Trump Administration and USDA Secretary Perdue have announced a second round of aid through CFAP. Up to $14 billion will be used to help farmers devastated by the economic disaster caused by the COVID-19 pandemic. This CFAP2 builds on the almost $10 billion the first CFAP provided to livestock, dairy, non-specialty, and specialty crop producers throughout the country.

(I’m about to get into the weeds here. I know not everyone will read this whole thing, so if you want details on how to apply, and a link to a helpful webinar… jump to the bottom.)

However, in that first round, many farmers were left out of CFAP, and although the program was expanded to include more commodities, aid was only made available for losses suffered before April 15, 2020; that’s a tough deadline for Virginia and states where most crops are not harvested that early.

USDA will use funds from the Commodity Credit Corporation (CCC) Charter Act and CARES Act to support row crops, livestock, specialty crops, dairy, aquaculture, and many additional commodities. USDA has incorporated improvements in CFAP 2 based from Farm Bureau input, stakeholder engagement, and public feedback to better meet the needs of impacted farmers. Producers can apply for CFAP 2 at USDA’s FSA county offices from September 21 through December 11, 2020.

CFAP 2 payments will be made for three categories of commodities – Price Trigger Commodities, Flat-rate Crops and Sales Commodities.

Price Trigger Commodities

Price trigger commodities are major commodities that meet a minimum 5-percent price decline over a specified period of time. Eligible price trigger crops include barley, corn, sorghum, soybeans, sunflowers, upland cotton, and all classes of wheat. Payments will be based on 2020 planted acres of the crop, excluding prevented planting and experimental acres. Payments for price trigger crops will be the greater of: 1) the eligible acres multiplied by a payment rate of $15 per acre; or 2) the eligible acres multiplied by a nationwide crop marketing percentage, multiplied by a crop-specific payment rate, and then by the producer’s weighted 2020 Actual Production History (APH) approved yield. If the APH is not available, 85 percent of the 2019 Agriculture Risk Coverage-County Option (ARC-CO) benchmark yield for that crop will be used.

For broilers and eggs, payments will be based on 75 percent of the producers’ 2019 production.

Dairy (cow’s milk) payments will be based on actual milk production from April 1 to August 31, 2020. The milk production for September 1, 2020, to December 31, 2020, will be estimated by FSA.

Eligible beef cattle, hogs and pigs, and lambs and sheep payments will be based on the maximum owned inventory of eligible livestock, excluding breeding stock, on a date selected by the producer, between April 16, 2020, and August 31, 2020.

Flat-rate Crops

Crops that either do not meet the 5-percent price decline trigger or do not have data available to calculate a price change will have payments calculated based on eligible 2020 acres multiplied by $15 per acre. These crops include alfalfa, extra-long staple (ELS) cotton, oats, peanuts, rice, hemp, millet, mustard, safflower, sesame, triticale, rapeseed, and several others.

Sales Commodities

Sales commodities include specialty crops; aquaculture; nursery crops and floriculture; other commodities not included in the price trigger and flat-rate categories, including tobacco; goat milk; mink (including pelts); mohair; wool; and other livestock (excluding breeding stock) not included under the price trigger category that were grown for food, fiber, fur, or feathers. Payment calculations will use a sales-based approach, where producers are paid based on five payment gradations associated with their 2019 sales.

Additional commodities are eligible in CFAP 2 that weren’t eligible in the first iteration of the program. If your agricultural operation has been impacted by the pandemic since April 2020, we encourage you to apply for CFAP 2. A complete list of eligible commodities, payment rates and calculations can be found on farmers.gov/cfap.

Eligibility

There is a payment limitation of $250,000 per person or entity for all commodities combined. Applicants who are corporations, limited liability companies, limited partnerships may qualify for additional payment limits when members actively provide personal labor or personal management for the farming operation. In addition, this special payment limitation provision has been expanded to include trusts and estates for both CFAP 1 and 2.

Producers will also have to certify they meet the Adjusted Gross Income limitation of $900,000 unless at least 75 percent or more of their income is derived from farming, ranching or forestry-related activities. Producers must also be in compliance with Highly Erodible Land and Wetland Conservation provisions.

Applying for Assistance

Producers can apply for assistance beginning September 21, 2020. Applications will be accepted through December 11, 2020.

Additional information and application forms can be found at farmers.gov/cfap. Documentation to support the producer’s application and certification may be requested. All other eligibility forms, such as those related to adjusted gross income and payment information, can be downloaded from farmers.gov/cfap/apply. For existing FSA customers, including those who participated in CFAP 1, many documents are likely already on file. Producers should check with FSA county office to see if any of the forms need to be updated.

Customers seeking one-on-one support with the CFAP 2 application process can call 877-508-8364 to speak directly with a USDA employee ready to help. This is a recommended first step before a producer engages with the team at the FSA county office.

All USDA Service Centers are open for business, including some that are open to visitors to conduct business in person by appointment only. All Service Center visitors wishing to conduct business with FSA, Natural Resources Conservation Service or any other Service Center agency should call ahead and schedule an appointment. Service Centers that are open for appointments will pre-screen visitors based on health concerns or recent travel, and visitors must adhere to social distancing guidelines. Visitors are also required to wear a face covering during their appointment. Our program delivery staff will be in the office, and they will be working with our producers in the office, by phone and using online tools. More information can be found at farmers.gov/coronavirus.

In Closing

In the early weeks and months of the pandemic, farmers saw demand for their markets disappear and shift in ways that were extraordinarily difficult to respond to, especially for producers of perishable commodities. Even though concerns over food supplies have now subsided, the economic hardships are still taking their toll on farm families across the Commonwealth and country. We don’t know when this pandemic will end, and stacked on top of it we are still feeling the effects of trade imbalances and severe weather. This CFAP2 lifeline will keep farmers afloat as they continue to keep America’s pantries stocked, and our tables bountiful.

For more information on the program, how to apply, and eligibility, go to farmers.gov/CFAP

New Coronavirus Food Assistance Program 2.0 Producer Webinar

Click Here to Register
Thursday, September 24, 2020 at 3:00pm

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