California Fruit and Vegetable

Category: Ag Legislation

  • COVID-19 Impacts on Food Supply Chain (May 12 Zoom Call)

    Why is milk being dumped and produce left to rot in fields while grocery store shelves go empty during the COVID-19 pandemic? Why are grocery stores running out of meat, and eggs becoming so expensive?

    The head of California’s Department of Food and Agriculture, researchers from the University of California, Davis, and food purveyors will tackle these and other questions in an online panel discussion at 5 p.m. Tuesday, May 12.

    UC Davis invites the public to attend “Food Shortages in a Pandemic” over the web through Zoom conferencing. To do so, register online at least 48 hours in advance.

    The 90-minute event, which will include a question-and-answer period with the Zoom audience, will feature:

    • Karen Ross, secretary of the California Department of Food and Agriculture since 2011
    • Dan Sumner, director of the UC Agricultural Issues Center, professor of agricultural and resource economics at UC Davis, and former assistant secretary for economics at the U.S. Department of Agriculture
    • Bu Nygrens, co-owner and director of purchasing at Veritable Vegetable of San Francisco, which distributes organic produce from more than 200 small and mid-size growers to restaurants, markets and co-ops across five states
    • Chelsea Minor, corporate director of public affairs for Raley’s Supermarkets of West Sacramento, a regional grocery chain in Northern California and Nevada

    Moderating the event will be Catherine Brinkley, who, as an assistant professor in the Department of Human Ecology at UC Davis, studies the architecture of food supply networks. 

    The panel will discuss how the food supply chain works, why the COVID-19 pandemic has been so disruptive, how distributors and supply chains are adapting to serve restaurants and grocery stores, and whether changes can or should be made to make food systems more resilient.

    The lecture is the third in the Savor series, which explores some of the biggest food and beverage topics being studied today at UC Davis — a world leader in the study of agriculture. The series is presented by the Robert Mondavi Institute for Wine and Food Science and the UC Davis Library.

    – By Jessica Nusbaum and Julia Ann Easley, UC Davis

  • Tree & Vine Growers Eligible for Ongoing Disaster Assistance for Drought, Wildfire, Etc.

    The U.S. Department of Agriculture (USDA) has started making payments through the Wildfire and Hurricane Indemnity Program – Plus (WHIP+) to agricultural producers who suffered eligible losses because of drought or excess moisture in 2018 and 2019. Signup for these causes of loss opened March 23, and producers who suffered losses from drought (in counties designated D3 or above), excess moisture, hurricanes, floods, tornadoes, typhoons, volcanic activity, snowstorms or wildfires can still apply for assistance through WHIP+. 

    “To date, FSA has received more than 33,000 WHIP+ applications,” said Richard Fordyce, Administrator of USDA’s Farm Service Agency (FSA). “We want to remind producers that we are still accepting applications for WHIP+, and we encourage producers to call our offices for next steps on how to apply.”

    To be eligible for WHIP+, producers must have suffered losses of certain crops, trees, bushes or vines in counties with a Presidential Emergency Disaster Declaration or a Secretarial Disaster Designation (primary counties only) for qualifying natural disaster events that occurred in calendar years 2018 or 2019. Also, losses located in a county not designated by the Secretary as a primary county may be eligible if a producer provides documentation showing that the loss was due to a qualifying natural disaster event.

    For losses due to drought, a producer is eligible if any area of the county in which the loss occurred was rated D3, or extreme drought, or higher on the U.S. Drought Monitor during calendar years 2018 or 2019. Producers who suffered losses should contact their FSA county office. 

    In addition to the recently added eligible losses of drought and excess moisture, FSA will implement a WHIP+ provision for crop quality loss that resulted in price deductions or penalties when marketing crops damaged by eligible disaster events. To ensure an effective program for all impacted farmers, the Agency is currently gathering information on the extent of quality loss from producers and stakeholder organizations.

    USDA Service Centers, including FSA county offices, are open for business by phone only, and field work will continue with appropriate social distancing. While program delivery staff will continue to come into the office, they will be working with producers by phone and using online tools whenever possible. All Service Center visitors wishing to conduct business with the FSA, Natural Resources Conservation Service or any other Service Center agency are required to call their Service Center to schedule a phone appointment. More information on Service Centers can be found at farmers.gov/coronavirus, and more information on WHIP+ can be found at Remind.

  • Honey Bee & Pollinator Facility Officially Opened

    Washington State University celebrated the opening of its new Honey Bee & Pollinator Research, Extension, and Education Facility today with a formal ribbon cutting and self-guided tours of the building.

    “This new facility will be a tremendous benefit to our WSU bee and pollinator researchers as well as the beekeeping and agricultural industries in Washington and around the world,” said André-Denis Wright, dean of the College of Agricultural, Human, and Natural Resource Sciences. “The support we’ve had from donors like the Hiatt family, Ken and Sue Christianson, and Eric and Sue Olson, and groups like the Washington State Beekeepers Association has made this possible. We look forward to developing these important relationships as our scientists work to help save the bees.”

    The nearly 50-acre property, which WSU bought this winter, will house most of WSU’s Honey Bee and Pollinator program, which is part of the Department of Entomology. Over $3 million has been raised and fundraising is continuing to expand the impact of the Honey Bee and Pollinator program.

    “Our industry needs to support the science WSU researchers are doing,” said Tim Hiatt, co-owner of Hiatt Honey Co. “We’re happy to have helped secure this new home for them and are looking forward to the valuable research that will come out of it.”

    It’s not just beekeepers that will benefit, but the agriculture industry as a whole.

    “The seed crops we grew are so dependent on healthy pollinators,” said Ken Christianson, a retired seed grower and WSU alum. “The WSU bee program and the work they do is so essential to the future of agriculture and feeding the planet.”

    Research Work

    The 2020 season for WSU bee scientists will mostly be focused on getting moved in and set up as well as increasing their stock of honey bees. One of the biggest benefits of the new location is being able to have a commercial-sized number of colonies.

    “Having more colonies allows us to do larger field studies on a wide variety of topics,” said Steve Sheppard, P. F. Thurber Endowed Professor of Pollinator Ecology in WSU’s Department of Entomology. “We’re working on scaling up our fungi research to a commercially relevant scale, plus we hope to collaborate more with the seed production industry.”

    The program has indoor cold storage chambers already located in Othello that will be used to ramp up previous work researchers have done on a smaller scale. Now they can test the impact of in-season bee hibernation to fight varroa mites, one of the major causes of colony collapse, on a commercial scale.

    New Projects Possible With More Support

    The new property has two other structures that the bee program plans to make the most of: a greenhouse and a large building with netting inside.

    While they both will require updates to be functional, they will allow the program to expand its research into working with other pollinators like bumblebees and other native pollinators.

    The program is now fundraising to allow for new projects, and the scientists feel their research track record will instill confidence in future donors.

    This summer, WSU will host its annual beekeeping short course at the new facility, allowing both classes and bees to be located in the same place.

  • NMSU Determining Combination of Native Flowers to Attract Different Pollinators

    Pollinator insects play a critical role in the agricultural world. Without their natural transference of pollen from plant to plant while obtaining nutrients, many types of vegetables and fruit for human consumption would not exist.
     
    More than 80 percent of plants are pollinated by animals, mainly insects. In recent years, there has been a decline in pollinator insects for many reasons, one being the decline or loss of habitat.

    This is one area people can help support pollinator populations, by growing native flowering plants from which the pollinators obtain protein and lipids from the pollen, and carbohydrates and amino acids from the nectar.

    Researchers at New Mexico State University’s College of Agricultural, Consumer and Environmental Sciences are studying the activity of insects, both pollinator and beneficial, around native plants to determine what mix of flowering cultivars will attract the different insect types.

    “We have evaluated 22 different perennial native plants in seven different mixes, or combinations,” said Miranda Kersten, senior program specialist at NMSU’s Agricultural Science Center at Los Lunas, of the study that began in 2017. “For the last two summers, we have done visual observations where we record the number of different insect groups visiting the flower, and taken vacuum samples from each of the plots to see which species are attracted to the plants.”

    From the current study, which is supported by a U.S. Department of Agriculture National Institute of Food and Agriculture Extension Implementation Program grant, the researchers can suggest plants to attract bumble bees, large and small native bees, and natural enemies of pests such as the ladybeetles, syrphid flies, and large and small wasps.

    “The flowers range in color from various shades of purple and pink, to orange, yellow and white,” Kersten said. “We did not use red flowers because insects don’t see that color well and are less attracted to the blossoms.”

    When planning a pollinator garden, it is important to include plants that flower at different times of the season. 

    “All during the season, bees are busy collecting nectar and pollen, depending if they are honey bees or native bees, to feed their babies during the winter,” said Amanda Skidmore, NMSU Cooperative Extension Service small farm integrated pest management specialist. 

    “Spring blooms help the early emerging pollinators,” she said. “Blooms throughout the summer that are different colors and shapes help attract the insects while they are building their nest. Fall blooms help them store up an energy source for their babies’ development.”

    Bees are considered to be the most efficient pollinator. They are the only pollinator that feeds on pollen/nectar as larvae and adults.

    “Some of our native bees are generalists, visiting many types of flowers, while others are specialists, visiting a specific species,” Skidmore said. “Bumblebees are generalists that are active from early spring to late fall, while different species of native bees are active in different times of the year.”

    A little-known fact is that New Mexico has more than 1,000 unique native bee species – the third-highest number in the nation behind California and Arizona.

    During the project, the researchers learned that Riddell’s ragwort was the latest-blooming flower of the plants included in the study and it was highly visited by bees and wasps in the fall. Plants with extra-floral nectaries, such as Rocky Mountain penstemon, can provide additional resources through the growing season and benefit a variety of insects.

    To learn more about identifying these beneficial insect groups, visit https://aces.nmsu.edu/pubs/_h/H172/welcome.html for the Extension publication “Backyard Beneficial Insects of New Mexico.” — By Jane Moorman, New Mexico State University

  • USDA COVID-19 Food Assistance Program to Support Farmers

    Summary

    By Schramm, Williams & Associates, Inc. — The U.S. Department of Agriculture (USDA) announced the $19 billion Coronavirus Food Assistance Program (CFAP) to support farmers and ranchers during the COVID-19 pandemic. This program is comprised of two major elements: direct payments to farmers and ranchers and commodity purchase and distribution.

    • Direct Payments Program – Provides $16 billion in direct support based on actual losses for agricultural producers where prices and market supply chains have been impacted and will assist producers with additional adjustment and marketing costs resulting from lost demand and short-term oversupply for the 2020 marketing year caused by COVID-19.
    • Purchase and Distribution Program – $3 billion of agricultural products, including meat, dairy, and produce will be purchased to support producers and provided food to those in need. USDA will work with local food and regional distributors to deliver food to food banks, as well as community and faith-based organization to provide food to those in need.

    CFAP uses funding authorities provided in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the Families First Coronavirus Response Act (FFCRA), USDA’s existing CCC funding, and Section 32 authority.

    Direct Assistance Program

    Source of Funds

    This program is funded using the $9.5 billion emergency program secured in the CARES Act and $6.5 billion in Credit Commodity Corporation (CCC) funding.

    Payment Allocations

    USDA will provide $16 billion in direct payments to farmers and ranchers including:

    • $2.1 billion for specialty crops producers
    • $500 million for others crops

    Payment Calculations

    Producers will receive a single payment determined using two calculations:

    1. Price losses that occurred January 1 – April 15, 2020.
    2. Producers will be compensated for 85% of price loss during that period.
    3. The expected losses from April 15 through the next two quarters.
    4. Will cover 30% of expected losses.

    Limitations

    • The payment limit is $125,000 per commodity with an overall limit of $250,000 per individual or entity.
    • Qualified commodities must have experienced a 5% price decrease between January and April.

    Expected Timeframe

    Program Sign-up: Beginning in Early May

    Payment Distribution: End of May or early June

    Food Purchase and Distribution Program

    Commodity Procurement

    It will begin with the procurement of an estimated:

    • $100 million per month in fresh fruits and vegetables;
    • $100 million per month in a variety of dairy products;
    • $100 million per month in meat products.

    Distribution

    The distributors and wholesalers will provide a pre-approved box of fresh produce, dairy, and meat products to food banks, community and faith-based organizations, and other non-profits serving Americans in need.

    Additional Food Purchasing

    In addition to the two targeted programs, USDA will utilize other available funding sources to purchase and distribute food to those in need.

    • USDA has up to an additional $873.3 million available in Section 32 funding to purchase a variety of agricultural products for distribution to food banks. The use of these funds will be determined by industry requests, USDA agricultural market analysis, and food bank needs.
    • The FFCRA and CARES Act provided an at least $850 million for food bank administrative costs and USDA food purchases, of which a minimum of $600 million will be designated for food purchases. The use of these funds will be determined by food bank need and product availability.

     

    Further details regarding eligibility, rates, and other implementation will be released at a later date.

  • USDA COVID-19 Food Assistance Program to Support Farmers

    Summary

    By Schramm, Williams & Associates, Inc. — The U.S. Department of Agriculture (USDA) announced the $19 billion Coronavirus Food Assistance Program (CFAP) to support farmers and ranchers during the COVID-19 pandemic. This program is comprised of two major elements: direct payments to farmers and ranchers and commodity purchase and distribution.

    • Direct Payments Program – Provides $16 billion in direct support based on actual losses for agricultural producers where prices and market supply chains have been impacted and will assist producers with additional adjustment and marketing costs resulting from lost demand and short-term oversupply for the 2020 marketing year caused by COVID-19.
    • Purchase and Distribution Program – $3 billion of agricultural products, including meat, dairy, and produce will be purchased to support producers and provided food to those in need. USDA will work with local food and regional distributors to deliver food to food banks, as well as community and faith-based organization to provide food to those in need.

    CFAP uses funding authorities provided in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the Families First Coronavirus Response Act (FFCRA), USDA’s existing CCC funding, and Section 32 authority.

    Direct Assistance Program

    Source of Funds

    This program is funded using the $9.5 billion emergency program secured in the CARES Act and $6.5 billion in Credit Commodity Corporation (CCC) funding.

    Payment Allocations

    USDA will provide $16 billion in direct payments to farmers and ranchers including:

    • $2.1 billion for specialty crops producers
    • $500 million for others crops

    Payment Calculations

    Producers will receive a single payment determined using two calculations:

    1. Price losses that occurred January 1 – April 15, 2020.
    2. Producers will be compensated for 85% of price loss during that period.
    3. The expected losses from April 15 through the next two quarters.
    4. Will cover 30% of expected losses.

    Limitations

    • The payment limit is $125,000 per commodity with an overall limit of $250,000 per individual or entity.
    • Qualified commodities must have experienced a 5% price decrease between January and April.

    Expected Timeframe

    Program Sign-up: Beginning in Early May

    Payment Distribution: End of May or early June

    Food Purchase and Distribution Program

    Commodity Procurement

    It will begin with the procurement of an estimated:

    • $100 million per month in fresh fruits and vegetables;
    • $100 million per month in a variety of dairy products;
    • $100 million per month in meat products.

    Distribution

    The distributors and wholesalers will provide a pre-approved box of fresh produce, dairy, and meat products to food banks, community and faith-based organizations, and other non-profits serving Americans in need.

    Additional Food Purchasing

    In addition to the two targeted programs, USDA will utilize other available funding sources to purchase and distribute food to those in need.

    • USDA has up to an additional $873.3 million available in Section 32 funding to purchase a variety of agricultural products for distribution to food banks. The use of these funds will be determined by industry requests, USDA agricultural market analysis, and food bank needs.
    • The FFCRA and CARES Act provided an at least $850 million for food bank administrative costs and USDA food purchases, of which a minimum of $600 million will be designated for food purchases. The use of these funds will be determined by food bank need and product availability.

     

    Further details regarding eligibility, rates, and other implementation will be released at a later date.

  • FSA Adjusts Farm Loan, Disaster, Conservation and Safety Net Programs

    FSA Services Available by Phone Appointment Only: USDA’s Farm Service Agency (FSA) county offices are open by phone appointment only until further notice, and FSA staff are available to continue helping agricultural producers with program signups, loan servicing and other important actions. Additionally, FSA is relaxing the loan-making process and adding flexibilities for servicing direct and guaranteed loans to provide credit to producers in need. FSA Service Centers are open for business by phone appointment only. While our program delivery staff will continue to come into to the office, they will be working with our agricultural producers by phone and using email and online tools whenever possible.

     

    “FSA programs and loans are critical to America’s farmers and ranchers, and we want to continue our work with customers while taking precautionary measures to help prevent the spread of coronavirus,” FSA Administrator Richard Fordyce said. “We recognize that farm loans are critical for annual operating and family living expenses, emergency needs and cash flow through times like this. FSA is working to find and use every option and flexibility to provide producers with credit options and other program benefits.”

    FSA is delivering programs and services, including:

    • Farm loans;
    • Commodity loans;
    • Farm Storage Facility Loan program;
    • Disaster assistance programs, including signup for the Wildfire and Hurricane Indemnity Program Plus (this includes producers now eligible because of losses due to drought and excess moisture in 2018 and 2019);
    • Safety net programs, including 2020 signup for the Agriculture Risk Coverage and Price Loss Coverage programs;
    • Conservation programs; and
    • Acreage reports.

    Relaxing the Farm Loan-Making Process

    FSA is relaxing the loan-making process, including:

    • Extending the deadline for applicants to complete farm loan applications;
    • Preparing Direct Loans documents even if FSA is unable to complete lien and record searches because of closed government buildings. Once those searches are complete, FSA would close the loan; and
    • Closing loans if the required lien position on the primary security is perfected, even for loans that require additional security and those lien searches, filings and recordings cannot be obtained because of closed government buildings.

    Servicing Direct Loans

    FSA is extending deadlines for producers to respond to loan servicing actions, including loan deferral consideration for financially distressed and delinquent borrowers.

    FSA will temporarily suspend loan accelerations, non-judicial foreclosures, and referring foreclosures to the Department of Justice. The U.S. Attorney’s Office will make the determination whether to stop foreclosures and evictions on accounts under its jurisdiction.

    Servicing Guaranteed Loans

    Guarantee lenders can self-certify, providing their borrowers with:

    • Subsequent-year operating loan advances on lines of credit;
    • Emergency advances on lines of credit.

    FSA will consider guaranteed lender requests for:

    • Temporary payment deferral consideration when borrowers do not have a feasible plan reflecting that family living expenses, operating expenses and debt can be repaid; and
    • Temporary forbearance consideration for borrowers on loan liquidation and foreclosure actions.

    Contacting FSA

    FSA will be accepting additional forms and applications by facsimile or electronic signature. Some services are also available online to customers with an eAuth account, which provides access to the farmers.gov portal where producers can view USDA farm loan information and payments and view and track certain USDA program applications and payments. Customers can track payments, report completed practices, request conservation assistance and electronically sign documents. Customers who do not already have an eAuth account can enroll at farmers.gov/sign-in.

    FSA encourages producers to contact their county office to discuss these programs and temporary changes to farm loan deadlines and the loan servicing options available. For Service Center contact information, visit farmers.gov/coronavirus.

  • FSA Adjusts Farm Loan, Disaster, Conservation and Safety Net Programs

    FSA Services Available by Phone Appointment Only: USDA’s Farm Service Agency (FSA) county offices are open by phone appointment only until further notice, and FSA staff are available to continue helping agricultural producers with program signups, loan servicing and other important actions. Additionally, FSA is relaxing the loan-making process and adding flexibilities for servicing direct and guaranteed loans to provide credit to producers in need. FSA Service Centers are open for business by phone appointment only. While our program delivery staff will continue to come into to the office, they will be working with our agricultural producers by phone and using email and online tools whenever possible.

     

    “FSA programs and loans are critical to America’s farmers and ranchers, and we want to continue our work with customers while taking precautionary measures to help prevent the spread of coronavirus,” FSA Administrator Richard Fordyce said. “We recognize that farm loans are critical for annual operating and family living expenses, emergency needs and cash flow through times like this. FSA is working to find and use every option and flexibility to provide producers with credit options and other program benefits.”

    FSA is delivering programs and services, including:

    • Farm loans;
    • Commodity loans;
    • Farm Storage Facility Loan program;
    • Disaster assistance programs, including signup for the Wildfire and Hurricane Indemnity Program Plus (this includes producers now eligible because of losses due to drought and excess moisture in 2018 and 2019);
    • Safety net programs, including 2020 signup for the Agriculture Risk Coverage and Price Loss Coverage programs;
    • Conservation programs; and
    • Acreage reports.

    Relaxing the Farm Loan-Making Process

    FSA is relaxing the loan-making process, including:

    • Extending the deadline for applicants to complete farm loan applications;
    • Preparing Direct Loans documents even if FSA is unable to complete lien and record searches because of closed government buildings. Once those searches are complete, FSA would close the loan; and
    • Closing loans if the required lien position on the primary security is perfected, even for loans that require additional security and those lien searches, filings and recordings cannot be obtained because of closed government buildings.

    Servicing Direct Loans

    FSA is extending deadlines for producers to respond to loan servicing actions, including loan deferral consideration for financially distressed and delinquent borrowers.

    FSA will temporarily suspend loan accelerations, non-judicial foreclosures, and referring foreclosures to the Department of Justice. The U.S. Attorney’s Office will make the determination whether to stop foreclosures and evictions on accounts under its jurisdiction.

    Servicing Guaranteed Loans

    Guarantee lenders can self-certify, providing their borrowers with:

    • Subsequent-year operating loan advances on lines of credit;
    • Emergency advances on lines of credit.

    FSA will consider guaranteed lender requests for:

    • Temporary payment deferral consideration when borrowers do not have a feasible plan reflecting that family living expenses, operating expenses and debt can be repaid; and
    • Temporary forbearance consideration for borrowers on loan liquidation and foreclosure actions.

    Contacting FSA

    FSA will be accepting additional forms and applications by facsimile or electronic signature. Some services are also available online to customers with an eAuth account, which provides access to the farmers.gov portal where producers can view USDA farm loan information and payments and view and track certain USDA program applications and payments. Customers can track payments, report completed practices, request conservation assistance and electronically sign documents. Customers who do not already have an eAuth account can enroll at farmers.gov/sign-in.

    FSA encourages producers to contact their county office to discuss these programs and temporary changes to farm loan deadlines and the loan servicing options available. For Service Center contact information, visit farmers.gov/coronavirus.

  • CA Leafy Greens Marketing Agreement New Membership Sign Up Due April 1

    The California Leafy Greens Marketing Agreement (LGMA) is currently accepting sign-up forms from new signatories for the2020/21 fiscal year. Since 2007, handlers of California lettuce, spinach and other leafy greens have protected public health by establishing a culture of food safety on the farm through the California Leafy Greens Marketing Agreement. Buyers of leafy green products look for LGMA certification to see if their suppliers are certified LGMA members; additionally, both Canada and Mexico have regulations in place allowing imports of leafy greens only from LGMA-certified companies.

     

    To participate in the LGMA program from April 1, 2020 – March 31, 2021, handlers must submit a sign-up form to the LGMA office by end of day on April 1, 2020. The form can be downloaded by clicking here.

     

    The LGMA has two sign-up periods: at the beginning of its fiscal year (deadline of April 1st) and halfway through its fiscal year (deadline of October 1st). The April 1st deadline is timely for companies in the Salinas region, while the October 1st deadline accommodates handlers in other regions of the state like the Imperial and San Joaquin Valleys. Current members do not need to sign up again.

     

    Handlers who would like to join the LGMA should verify that they meet the LGMA’s definition of a handler and that they handle at least one of the leafy green products covered under the LGMA program. The LGMA defines a handler as: Any person or entity that handles, processes, ships, or distributes leafy green product for market, whether as owner, agent, employee, broker, or otherwise. This definition does not include retailers or companies that grow, but do not market product.

     

    The leafy green products covered by the LGMA are:

    arugula, chard, iceberg lettuce, spinach, baby leaf lettuce, endive, kale, spring mix, butter lettuce, escarole, red leaf lettuce, cabbage, green leaf lettuce, and romaine lettuce

     

    Prospective members should contact Amarachi Okemiri, Member Services + LGMA Tech Director to receive the Membership Information sheet before filling out and returning the sign-up form. Once enrolled in the program, members are subject to compliance audits conducted by California Department of Food and Agriculture inspectors. The goal of these audits is to verify that handlers and their growers comply with the accepted Food Safety Practices of the LGMA. New LGMA Members will be subject to assessment payments on all California grown leafy greens handled by the company during the period of April 1, 2020 – March 31, 2021.

     

    Contact Amarachi Okemiri, Member Services + LGMA Tech Director, or Brooke Palmer, Executive Assistant, with any questions. Email: amarachi@lgma.ca.gov or brooke@lgma.ca.gov. Call the office at 916-441-1240.

  • House Approves, Trump Signs Coronavirus Stimulus into Law

    President Donald J. Trump today signed the “Coronavirus Aid, Relief and Economic Security Act” (CARES Act) into law with provisions to provide financially distressed consumers and small businesses greater access to business loans and bankruptcy relief. The legislative package, which quickly passed the House of Representatives on a voice vote earlier today and 96-0 in the Senate on Wednesday, provides a $2 trillion economic stimulus for U.S. industries and citizens faced with the challenges of the COVID-19 coronavirus.

    Upon passage of the stimulus package, Agricultural Retailers Association (ARA) President and CEO Daren Coppock shared, “We recognize that the health and safety of all people is a priority at this time. ARA is grateful that Congress is taking swift action to remedy the current situation in our country through passage of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).  Ag retailers and their farmer customers, as always, are committed to continuing their businesses so that they can deliver the safe, healthy, and abundant food supply that is in demand now and required for the future.  We are pleased with the support that Congress has included for the agriculture industry in this bill, and encourage the president to sign it so that we can have certainty moving forward.”

    National Milk Producers Federation (NMPF) President and CEO Jim Mulhern offered the following statement:

    “We thank President Trump for quickly signing this measure into law. It will provide much-needed help to dairy producers, who are experiencing steep drops in milk and dairy-product prices due to the COVID-19 pandemic.  With the CARES Act now law, we look forward to working with Agriculture Secretary Sonny Perdue on several important initiatives, including the need for a significant purchase of multiple dairy products. These efforts will be important to address sales lost because of COVID-19, lift farm milk prices and send a critical signal to disrupted dairy markets. Government dairy-product purchases will provide our food banks with an important, nutritious and popular staple item that will help feed families in need.”

    Michael Dykes, President and CEO of the International Dairy Foods Association (IDFA) shared, “The International Dairy Foods Association commends Congress for acting swiftly and decisively to bring financial relief to American businesses, households and workers as a result of the COVID-19 outbreak, which has delivered an historic blow to our nation’s economy and workforce. On behalf of America’s dairy industry, IDFA is grateful that this bipartisan bill has put a special emphasis on businesses large and small, farmers, and our rural communities who grow, process and distribute many of the foods and beverages that are so vital to Americans during this crisis. We urge Congress to continue to be mindful of the critical part the food industry plays in our national security, economic security and food security. The United States is the world’s most productive food and agricultural economy in the world, and our legislators and federal officials must do everything in their power to ensure continuity of operations throughout the food supply chain. Our food security is absolutely essential.”

    Dykes continued, “Now we are seeing record jobless claims for Americans, which presents hardships to families just trying to put nutritious, wholesome food on their tables. Our federal government must now turn its attention to those Americans most in need by ensuring our food banks, pantries and distributors have an abundant supply of food for families trying to make ends meet. The CARES Act includes billions of dollars to support federal nutrition and feeding programs, as well as $450 million for USDA to provide food banks with additional resources for food and distribution. With resources in place through replenishment of the Commodity Credit Corporation, billions for nutrition and feeding programs, and millions to support our food banks, it is incumbent on USDA to act without delay. We urge USDA to act today to make record purchases of fluid and powdered milk, cheese, and other dairy products, as well as other foods and commodities, to equip our food banks for a surge of food-insecure Americans and to bring certainty and balance to the marketplace due to whole sectors of the economy shutting down due to COVID-19. The closure of restaurants, cafes, bars and other food service operators as a result of COVID-19 has created a major market gap for our dairy producers and processors. While retail sales have climbed steadily, the loss of foodservice, which accounted for roughly 50% of all food sales, has presented a significant challenge to our industry. USDA should act now to direct those products to food banks to help people in need. This will prioritize those most in need, provide certainty to producers and agribusinesses, and restore needed balance in the marketplace.”

    The CARES Act provides:

    Relief for Farmers and Ranchers

    • $9.5 billion dedicated disaster fund to help farmers who are experiencing financial losses from the coronavirus crisis, including targeted support for fruit and vegetable growers, dairy and livestock farmers, and local food producers, who have been shorted from receiving emergency assistance in the past.
    • $14 billion to fund the Farm Bill’s farm safety net through the Commodity Credit Corporation.
    • Eligibility for farmers and agricultural and rural businesses to receive up to $10 million in small business interruption loans from eligible lenders, including Farm Credit institutions, through the Small Business Administration. Repayment forgiveness will be provided for funds used for payroll, rent or mortgage, and utility bills.
    • $3 million to increase capacity at the USDA Farm Service Agency to meet increased demand from farmers affected by the coronavirus crisis.

    Assistance for Small Towns and Rural Communities

    • $1 billion available in guaranteed loans to help rural businesses weather the economic downturn.
    • $100 billion to hospitals, health care providers, and facilities, including those in rural areas.
    • $25 million for telemedicine tools to help rural patients access medical care no matter where they live.
    • $100 million for high-speed internet expansion in small towns and rural communities.
    • Over $70 million to help the U.S. Forest Service serve rural communities and reduce the spread of coronavirus through personal protective equipment for first responders and cleaning of facilities.

    Protections for Consumers and the Food Supply

    • $55 million for inspection and quarantine at our borders to protect against invasive pests and animal disease.
    • $33 million for overtime and temporary food safety inspectors to protect America’s food supply at meat processing plants.
    • $45 million to ensure quality produce and meat reaches grocery stores through increased support for the Agricultural Marketing Service.
    • $1.5 million to expedite EPA approvals of disinfectants needed to control the spread of coronavirus.

    Food Access for Families

    • $15.8 billion to fund food assistance changes made in the Families First Coronavirus Response Act. Republicans and the Trump Administration blocked additional funding to expand benefits for children, families, and seniors.
    • $9 billion to fund child nutrition improvements made in the Families First Coronavirus Response Act.
    • $450 million to provide food banks with additional resources for food and distribution.
    • $100 million for food distribution in Tribal communities to provide facility improvements, equipment upgrades, and food purchases

    The California Association of Winegrape Growers (CAWG) shared that two small business loan programs have been created as a result of the COVID-19 pandemic. These may help small business operations (growers) that are dealing with the economic challenges of the pandemic. Small business is defined as a company with less than 501 employees and California small businesses are eligible for both programs.

    • The first program includes $1 billion to immediately assist small businesses hit hard by the current economic shutdown. Unlike traditional Small Business Administration (SBA) funding mechanisms, this program is being administered directly by the SBA and is live and accepting applications NOW.
    • The second program includes the Paycheck Protection Program and the Economic Injury Disaster Loan (EIDL) program. These will be administered more like traditional SBA programs, i.e. through third-party 7(a) lenders.

    Key Bankruptcy Provisions within the CARES Act Include:

    • Amending the Small Business Reorganization Act of 2019 (SBRA) to increase the eligibility threshold for businesses filing under new subchapter V of chapter 11 of the U.S. Bankruptcy Code from $2,725,625 of debt to $7,500,000. The eligibility threshold will return to $2,725,625 after one year. The increased debt limit for struggling small businesses to access subchapter V reflects recommendations of ABI’s Commission to Study the Reform of Chapter 11.
    • Amending the definition of “income” in the Bankruptcy Code for chapters 7 and 13 to exclude coronavirus-related payments from the federal government from being treated as “income” for purposes of filing bankruptcy.
    • Clarifying that the calculation of disposable income for purposes of confirming a chapter 13 plan shall not include coronavirus-related payments.
    • Explicitly permitting individuals and families currently in chapter 13 to seek payment plan modifications if they are experiencing a material financial hardship due to the coronavirus pandemic, including extending their payments for up to seven years after their initial plan payment was due.

    The American Bankruptcy Institute (ABI) emphasized that the bankruptcy provisions of the CARES Act listed above sunset within a year. Additionally, the law provides temporary relief for federal student loan borrowers by requiring the Secretary of Education to defer student loan payments, principal, and interest for 6 months, through September 30, 2020, without penalty to the borrower for all federally owned loans. This provides relief for over 95 percent of student loan borrowers.

    “The American Bankruptcy Institute (ABI) commends Congress and the President for their prompt action on this stimulus package to provide needed financial relief due to the COVID-19 coronavirus pandemic,” said ABI Executive Director Amy Quackenboss. “Consumers and small businesses will have greater access to the financial fresh start of bankruptcy thanks to this important legislation. “Our members will be sure to utilize these tools to help consumers and small businesses struggling with overwhelming debts due to the economic fallout of the pandemic.”

    ABI will be holding a free abiLIVE webinar with experts examining the bankruptcy provisions of the CARES Act on April 3 at 1 p.m. EDT. To register, please click here.