Small Biz Admin Stimulus Updates - PPP & EIDL

June 20, 2020

The Small Business Administration recently announced updates to their programs to assist small businesses with the COVID-19 pandemic.

Paycheck Protection Program (PPP)

The deadline to apply for the PPP is June 30th.

When this program was originally announced earlier this spring, the condition for the loan to be forgiven (the loan essentially becomes a grant) was that a business would have to keep everyone on their payroll or re-hire laid off staff within 8 weeks. That deadline has now been extended to 24 weeks from the date of the loan being approved, or by December 31, 2020, whichever comes first. You can read more about the PPP on our website here or click here to get information from the SBA.

Economic Injury Disaster Loan (EIDL)

High demand had slowed down the process of getting applications to the EIDL program approved, and at one point, only agricultural business applications could submit new applications. As of June 15, the SBA is accepting new EIDL applications from all eligible small businesses and U.S. agricultural businesses. EIDL applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis. To learn more about eligibility and apply, click here and read the description on our website.


USDA misses Origin of Livestock Deadline: OFA sends letter to Congress

Organic Farmers Association

June 18, 2020

Dear Senator/Representative,

In the FY 2020 appropriations bill, Congress gave the U.S. Department of Agriculture’s National Organic Program (NOP) 180 days to finalize a long-delayed rule that will level the playing field for organic dairy farmers. The NOP has now missed this deadline. We urge you to ensure that the agency complies with the law and finalizes the Origin of Livestock rule as soon as possible.

The rule is critical for creating a level playing field for all organic dairy producers and will safeguard the integrity of the organic label. Because the current standard is inhibiting the NOP’s ability to provide consistent and fair enforcement, the organic community has worked for many years to close loopholes for how livestock are transitioned to organic production. The Origin of Livestock rule will close the loopholes by specifying that organic dairy animals must be raised organically from the last third of gestation or be raised organically for one year if transitioning a conventional herd to organic, which is allowed only once. Cycling dairy animals in and out of organic production must be prohibited, and once a distinct herd is transitioned to organic, all animals must be raised organically from the last third of gestation.

The organic label is one of the most highly trusted labels for consumers. This is due to the strong standards and enforcement behind the label. But failing to close loopholes in the standards that allow practices that do not meet consumers’ expectations puts consumer trust in the label at risk. The delay in issuing a final rule has resulted in economic harm for organic dairy farmers from low pay prices caused by an oversupply of organic milk that is enabled by loopholes in the current rule. Because the need to strengthen the standards for organic livestock is so clearly causing harm, when the NOP accepted public comments on this rule in 2015, the vast majority of the original comments supported making these changes.

Congress recognized the need to strengthen the standards and included language in the FY 2020 Agriculture, Rural Development, Food and Drug Administration and Related Agency Appropriations bill requiring the NOP to issue a final Origin of Livestock rule within 180 days from the date of enactment. But that deadline has now passed, and the NOP has not yet finalized the rule.

Organic dairy farmers are suffering and continued delays in implementing this rule will prolong the dire economics facing organic dairy farmers, as well as jeopardize consumers’ trust in the organic label. It is past time for the NOP to finalize the rule and provide much-needed clarity requested by the organic community. We urge you to make sure that the NOP complies with Congress’ mandate and finalizes the origin of organic livestock rule as soon as possible.

Sincerely,

Organic Farmers Association
National Organic Coalition
Beretta Dairy
California Certified Organic Farmers
Carolina Farm Stewardship Association
Center for Environmental Health
Community Alliance with Family Farmers
Cuatro Puertas
FairShare CSA Coalition
Farm Aid
Food & Water Action
Food Animal Concerns Trust (FACT)
Food Democracy Now!
FoodChain ID
Friends of the Earth
Global Organic Alliance, Inc.
Hanover Co-op Food Stores of NH & VT
Hoosier Organic Marketing Education
iEat Green, LLC
Illinois Stewardship Alliance
International Organic Inspectors Association
Iowa Organic Association
Kanalani Ohana Farm
Lady Moon Farms
Land Stewardship Project
Maine Farmland Trust
Maine Organic Farmers and Gardeners Association
Mensonides LLC. Providence farms.
Midwest Organic and Sustainable Education Services (MOSES)
Montana Organic Association
MOSA Certified Organic
National Family Farm Coalition
National Farmers Organization
National Farmers Union
Natural Grocers
Natural Resources Defense Council
Northeast Organic Dairy Producers Alliance
Northeast Organic Farming Association -- New York (NOFA-NY)
Northeast Organic Farming Association of New Hampshire (NOFA-NH)
Northeast Organic Farming Association of Vermont
Northeast Organic Farming Association- Interstate Council
Northeast Organic Farming Association – Massachusetts
Northern Plains Sustainable Agriculture Society
Northwest Center for Alternatives to Pesticides
Ohio Ecological Food and Farm Association
OneCert, Inc.
Oregon Tilth
Organic Advocacy
Organic Consumers Association
Organic Farmers Agency for Relationship Marketing (OFARM)
Organic Seed Alliance
Organic Seed Growers and Trade Association
Organic Trade Association
OrganicEye
Pasa Sustainable Agriculture
PCC Community Markets
Pennsylvania Certified Organic (PCO)
Provender Alliance
Raw Milk Institute
Rural Vermont
Sammons Custom Farming
Slow Food Western Slope
Socially Responsible Agricultural Project
Sonoma County Farm Bureau
Straus Family Creamery
The Cornucopia Institute
Valley Organic Growers Association
Virginia Association for Biological Farming
Western Organic Dairy Producers Alliance
Wild Farm Alliance


National Organic Organizations Pressure FSA to Act on Cost Share

June 5, 2020

Richard Fordyce

Administrator
Farm Service Agency
U.S. Department of Agriculture
Washington, D.C.

Dear Administrator Fordyce:

Like other farmers and food businesses, organic farmers and businesses are also struggling economically as a result of the coronavirus pandemic. As you work to implement the Coronavirus Food Assistance Program, we know that Farm Service Agency (FSA) personnel are stretched very thin in their efforts to respond to the pandemic. However, we are very concerned about the delay in FSA’s publication of the notice of funds availability (NOFA) for the two organic certification cost share programs for fiscal year 2020, one of agency’s core assistance programs for organic operations.

Funding for OCCSP is provided through two authorizations: (1) National Organic Certification Cost Share Program (National OCCSP) funds and (2) Agricultural Management Assistance (AMA) funds. Section 10105 of the Agricultural Improvement Act of 2018 (2018 Farm Bill, Pub. L. 115–334) amended section 10606(d) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 6523(d)), to authorize $2 million from CCC to be used for National OCCSP funds for each of FYs 2019 and 2020, $4 million for FY 2021, and $8 million for each of FYs 2022 and 2023, to remain available until expended. In addition, carryover federal funding from previous fiscal years was set aside to be used to fund OCCSP activities in 2019 and later years, until fully expended.

Last year, the FSA NOFA for the two Organic Certification Cost Share Programs was published in the Federal Register on April 29, 2019 to announce the availability of the OCCSP funding for Fiscal Year 2019.

https://www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/organic-certification-cost-share-program/pdf/occsp_nofa_2019-08624.pdf

Even with that NOFA publication date, the OCCSP funding for fiscal year 2019 was delayed relative to previous years.  As a result, we are very concerned that the significant delay in the FY 2020 NOFA for OCCSP activities will result in further delays in certification cost share reimbursements for certified organic operations who are struggling due to pandemic-related disruptions in their operations.

Therefore, we are requesting that a Notice of Funds Availability for Organic Certification Cost Share Program operations be published immediately.

Thank you for your consideration of this request.

Sincerely,

National Organic Coalition
National Farmers Union
National Sustainable Agriculture Coalition
Organic Farmers Association
Organic Farming Research Foundation
Organic Trade Association


JUNE POLICY UPDATE

By: Patty Lovera, Policy Director

PANDEMIC RESPONSE

Congress passed the CARES Act in late March, which provides money that farms can access from two parts of the federal government, the USDA and the Small Business Administration (SBA).

Small Business Administration

You can see more details about the SBA programs, called the Paycheck Protection Program and the Economic Injury Disaster Loan here. Last week, Congress passed and the President signed a bill to extend the time frame for re-hiring employees to convert the PPP loan to a grant and change some other requirements for the program. When the SBA releases the details on the new changes to the program, we will update the website.

CARES Act

The USDA is now operating its two main programs created by the CARES Act – the Farmers to Families Food Box (contracts to ship boxes of food to food banks) and the Coronavirus Food Assistance Program (CFAP) (direct payments to farmers for eligible commodities).

The USDA has released the details for its new program to buy farm commodities for distribution to food banks. The deadline for the first round of contracts was May 8th, but you can check out the USDA’s website for the deadline for the next round of contracts.

You can get more information about the CFAP direct payments program here, including information on how to submit a comment to USDA to ask for additional commodities to be added to the list of those eligible for payments (due June 22). The USDA is holding a series of webinars in early June for farmers, which might be useful if you are considering whether to apply to this program.

New Stimulus Bill

In addition to USDA putting the programs from the CARES Act into effect, Congress is expected to eventually pass some new legislation to deal with the ongoing economic impacts of the pandemic. The House passed a bill in mid-May called the HEROES Act, which would continue the approach from the CARES Act of providing funding for USDA to make payments to producers, as well as some additional funding for things like protective equipment. It is not clear yet when the Senate will start its process on developing a new bill, but it is clear that they will write their own proposal and not build off of the HEROES Act passed by the House.
OFA has been sharing specific ideas on the needs of organic farmers with members of Congress to make the case for programs that will work better for diversified organic farms, especially focusing on the Senate.

Share Your Stimulus Stories With Us (So we can make improvements)

One thing that helps us communicate with members of Congress as we try to influence the next pandemic response bill is stories about how the existing programs are working (or if they aren’t working.) Let us know if you have participated in either the USDA programs (food purchases or direct payments) or the Small Business Administration programs (Paycheck Protection Program or the Economic Injury Disaster Loan.) Good or bad, tell us how your experience with the programs has been so we can relay this information to the people designing the next round of response.

TAKE ACTION FOR ORGANIC INTEGRITY

Even though there are lots of other things dominating the news, and the attention of lawmakers, we still need to remind our elected officials and the USDA that there is immediate work to do to ensure the integrity of the organic label. The USDA is past its deadline for a new proposed rule to prevent fraud in organic supply chains (the “Strengthening Organic Enforcement” rule required by the 2018 Farm Bill), but we are hopeful that proposal will be moving through the approval process soon and will be letting you know when the public comment period on this important issue opens up.

We need to remind Congress that USDA is perilously close to missing a deadline that Congress set, for finishing a long overdue rule to increase the standards for how livestock are transitioned into organic (the “Origin of Livestock” rule.)

Email Congress

Right now, the best way to reach your members of Congress is likely to be email, since many congressional offices have shifted their staffs to working remotely. You can find contact information for your Representative at www.house.gov (use the “Find Your Representative” box at the top right and then go to your member’s website and look for a Contact tab) and your two Senators at www.senate.gov (go to the “Senators” tab and then “Contact” to find the Senators from your state.)

What to Say

Tell you members of Congress that they need to make sure USDA finishes the final rule on Origin of Livestock (OOL.) This rule is desperately needed to close loopholes in the organic standards related to the transitioning of conventional dairy cows into organic dairy operations. Through the Fiscal Year 2020 appropriations process, Congress mandated that USDA complete the OOL final rule by June 17, 2020. This deadline is fast approaching and we need Congress to make sure that USDA finishes this rule as soon as possible. Will your member call the NOP and ask them to meet the June 17 deadline?

Report Back

Email Patty@organicfarmerassociation.org if you received a positive response.


ACTION ALERT

Take Action for Organic Integrity!

Even though there are lots of other things dominating the news, and the attention of lawmakers, we still need to remind our elected officials and the USDA that there is immediate work to do to ensure the integrity of the organic label. The USDA is past its deadline for a new proposed rule to prevent fraud in organic supply chains (the “Strengthening Organic Enforcement” rule required by the 2018 Farm Bill), but we are hopeful that proposal will be moving through the approval process soon and will be letting you know when the public comment period on this important issue opens up.

But we also need to remind Congress that USDA is perilously close to missing a deadline set by Congress for finishing a long-overdue rule to increase the standards for how livestock are transitioned into organic (the “origin of livestock” rule.)

Email Congress

Right now, the best way to reach your members of Congress is likely to be email, since many congressional offices have shifted their staffs to working remotely. You can find contact information for your Representative at www.house.gov (use the “Find Your Representative” box at the top right and then go to your member’s website and look for a Contact tab) and your two Senators at www.senate.gov (go to the “Senators” tab and then “Contact” to find the Senators from your state.)

Here’s what you can tell them in your email.  Add details about your farm (especially if you are a dairy farmer) if you would like.

Example Email

Dear Senator/Representative:

I am your constituent and I urge you to act now to ensure that the USDA closes loopholes in the organic standards that are hurting organic dairy farmers. The USDA’s National Organic Program is about to miss a deadline set by Congress in the FY 2020 appropriations bill to finalize a rule on how animals are transitioned into organic production.

We desperately need this rule to close loopholes in the organic regulations that are being exploited by large-scale dairy operations that continuously cycle animals in and out of organic production. This rule is long overdue and it is necessary for consistent enforcement to create a level playing field for all organic dairy producers. USDA’s failure to tighten these standards has allowed some large operations to unfairly flood the market with organic milk, hurting smaller farmers and endangering consumers’ trust in the organic label.

Congress required USDA to complete the OOL final rule by June 17, 2020.  This deadline is fast approaching and we need you to make sure that USDA finishes this rule as soon as possible.

Sincerely,

<<Your name & contact information>>


USDA Announces Plan for Farm Payments for Coronavirus

This week, the USDA announced details on how it will distribute $16 billion in direct payments to farms impacted by the COVID-19 pandemic and public health response. The funding for these payments came from the CARES Act that Congress passed in late March, as well as the Commodity Credit Corporation, a USDA-run financial institution that funds many farm programs and commodity purchasing programs.  The details for the payments are available on USDA’s website for Coronavirus Food Assistance Program.

ELIGIBLE CROPS

USDA has determined that these crops suffered at least a 5% price decline or loss due to significant market disruptions from the pandemic from January through April 2020.

  • Non-specialty Crops malting barley, canola, corn, upland cotton, millet, oats, soybeans, sorghum, sunflowers, durum wheat, and hard red spring wheat
  • Wool
  • Livestock: cattle, hogs, and sheep (lambs and yearlings only)
  • Dairy
  • Specialty Crops
    • Fruits: apples, avocados, blueberries, cantaloupe, grapefruit, kiwifruit, lemons, oranges, papaya, peaches, pears, raspberries, strawberries, tangerines, tomatoes, watermelons
    • Vegetables: artichokes, asparagus, broccoli, cabbage, carrots, cauliflower, celery, sweet corn, cucumbers, eggplant, garlic, iceberg lettuce, romaine lettuce, dry onions, green onions, peppers, potatoes, rhubarb, spinach, squash, sweet potatoes, taro
    • Nuts: almonds, pecans, walnuts
    • Other: beans, mushrooms

PAYMENT RATES

USDA has set up different payment rates for each eligible crop. The rates are listed on the program website. (Note: the charts with the payment rates show two columns that split the payment by the source of funding, but the payment should be based on combining the two columns.) USDA is planning to pay 80% of the payment rate in this round of funding, and making the final 20% payment later in the year if funding is still available.

ELIGIBLE PRODUCERS

Producers must have an average adjusted gross income of less than $900,000 for tax years 2016, 2017, and 2018. If 75% of adjusted gross income comes from farming, ranching, or forestry, the limit of $900,000 does not apply.

Producers and legal entities also must:

  • Meet the conservation compliance provisions;
  • if a foreign person, provides land, capital, and a substantial amount of active personal labor to the farming operation; and
  • not have a controlled substance violation.

PAYMENT LIMIT

USDA has set a $250,000 maximum payment per individual/operation. Corporate entities with multiple shareholders may be able to collect up to three $250,000 payments.

CROPS NOT ELIGIBLE FOR PAYMENTS

The USDA listed some specific crops that are not eligible for payments, including sheep more than two years old, eggs/layers, soft red winter wheat, hard red winter wheat, white wheat, rice, flax, rye, peanuts, feed barley, Extra Long Staple (ELS) cotton, alfalfa, forage crops, hemp, and tobacco.

There is a comment period open until June 21st to request that USDA add more crops that will be eligible for payments. The request would need to demonstrate the price loss due to disruption from the pandemic. Details found here.

HOW TO APPLY

The Farm Service Agency is the USDA division that will handle applications for these direct payments. They will start accepting applications on Tuesday, May 26, 2020.

The USDA is advising people to schedule an appointment now to talk to FSA. You can find your local FSA office on the USDA’s website (bottom of the page).

If you are already in the FSA system, some of the information you will need to apply for these payments should already be on file (farm number, adjusted gross income information, etc.) If you have not worked with the FSA system before, take a look at the list of information they will need from you to get started on the website.

The USDA has also posted a short video on what the direct payment application will look like.


Take Action for Organic Integrity!

Coronavirus is going to continue to dominate Washington, D.C., but we also need to make sure the rules and enforcement needed to ensure integrity of the organic label aren’t forgotten.

The USDA is past its deadline for a new proposed rule to prevent fraud in organic supply chains (the Strengthening Organic Enforcement rule required by the 2018 Farm Bill) and the deadline for finishing up the Origin of Livestock rule (about transitioning livestock into organic) is coming up fast.

Help us remind Congress they must make sure USDA meets the Congressional deadlines to protect organic integrity.

Right now, the best way to reach your members of Congress is email, since many congressional offices are working remotely. You can find contact information for your Representative at www.house.gov (use the “Find Your Representative” box at the top right and then go to your member’s website and look for a Contact tab) and your two Senators at www.senate.gov (go to the “Senators” tab and then “Contact” to find the Senators from your state.)

Ask your members of Congress to make sure USDA finishes these two rules ASAP:

  • The Strengthening Organic Enforcement rule is critical for preventing fraud in the organic supply chain and ensuring that U.S. organic farms can compete on a level playing field. During the disruption caused by the pandemic, it is more important than ever to show that the U.S. is taking organic enforcement seriously. The 2018 Farm Bill required USDA to complete the rulemaking by December 19, 2019, but the proposed rule is still under review by the Office of Management and Budget.  Can you help us move this forward in the rulemaking process?
  • The final rule on Origin of Livestock (OOL) is desperately needed to close loopholes in the organic standards related to the transitioning of conventional dairy cows into organic dairy operations. Through the Fiscal Year 2020 appropriations process, Congress mandated that USDA complete the OOL final rule by June 17, 2020.  This deadline is fast approaching, and we need Congress to make sure that USDA finishes this rule as soon as possible.

Report back!

Email us to let us know what you find out!  Email us at: patty (at) organicfarmersassociation.org


May Policy Update: Coronavirus, NOSB & Action on Organic Integrity Rulemaking

By, Patty Lovera, Policy Director

The big news in DC, just like everywhere, continues to be the coronavirus pandemic, the impact on the food supply chain and how the government should respond. But there are other things happening in the world of organic policy, including the National Organic Standards Board spring meeting and continuing to push the USDA National Organic Program to finish rules we need to maintain the integrity of the organic label.

Pandemic Response

Congress passed the CARES Act in late March, which provides money that farms can access from two parts of the federal government, the USDA and the Small Business Administration. In late April, Congress passed another bill to provide more funding to the Small Business Administration programs because the original funding was spent very quickly due to high demand. You can see more details about the SBA programs here, but the most important update since last month is that farms can now apply to both the Paycheck Protection Program and the Economic Injury Disaster Loan program.

The USDA is still developing the rules for one of its programs, direct payments to producers for losses caused by the pandemic, and we don’t yet have any specific details for how farms can apply. Those rules are expected to be released very soon. A basic description of the payment program can be found here.

The USDA has released the details for its new program to buy farm commodities for distribution to food banks. The deadline for the first round of contracts was May 8th, but you can check out the USDA’s website for the deadline for the next round of contracts.

At some point, Congress will consider other spending bills in response to the pandemic. It still isn’t clear if the next package will be more specific on how departments like the USDA spend money or will just be a repeat of the broad strokes provided in the CARES Act. OFA has been sharing specific requests for organic funding with members of Congress to make the case for programs that will work better for organic farms.

National Organic Standards Board Meeting

At the end of April, the USDA’s organic advisory committee, the National Organic Standards Board (NOSB), held its spring meeting online. The previous week, more than 20 organic farmers and representatives from farm organizations gave public comments to the board through a webinar.  You can read testimony for OFA’s Director and Policy Director on our website.

You can keep an eye on the USDA’s website for the NOSB to see the transcript and records from the meeting when they are posted.

One of the hot topics at the meeting was the ongoing discussion about paper pots. The board considered a discussion document about whether paper pots can be used by organic farms. They did not vote on the issue, and the Crops subcommittee will continue working on their recommendation about which types of paper pots (based on paper source and adhesives) will be allowed. The director of the National Organic Program made a point to say during the meeting that the NOP has instructed organic certifiers that paper pots will continue to be allowed while the board continues is work on this issue.

Take Action for Organic Integrity!

Even though the coronavirus is going to continue to dominate lawmaker’s attention for a while, we also need to make sure that the rules and enforcement we need to ensure the integrity of the organic label aren’t forgotten. The USDA is past its deadline for a new proposed rule to prevent fraud in organic supply chains (the “Strengthening Organic Enforcement rule required by the 2018 Farm Bill) and the deadline for finishing up the Origin of Livestock rule (about transitioning livestock into organic) is coming up fast.

Click here to TAKE ACTION!

 


OFA & NOC ask USDA for more support for organic farmers during COVID-19

May 7, 2020

The Honorable Nancy Pelosi                                     The Honorable Kevin McCarthy
Speaker                                                                     Minority Leader
U.S. House of Representatives                                  U.S. House of Representatives
Washington, DC 20515                                             Washington, DC 20515

The Honorable Mitch McConnell                              The Honorable Charles E. Schumer
Majority Leader                                                         Minority Leader
United States Senate                                                 United States Senate
Washington, DC 20510                                              Washington, DC 20510

Dear House and Senate Leaders:

As you begin crafting the next coronavirus pandemic response package, we are writing with recommendations about actions needed to address the impact on the organic food and agriculture sector. We offer our recommendations with full understanding that all sectors of agriculture are now in crisis and that we must all work together to address these challenges.

We are deeply concerned about the impact of COVID-19 on organic farmers, farmworkers, businesses, retailers, certifiers, organic inspectors, and consumers. We are mindful of the need to protect the health and safety of all who are involved in organic agriculture, certification, and compliance. We also seek to advocate for responsible actions that will protect the integrity of the USDA organic seal during this difficult time.

Because of the annual organic certification process and the need to protect the integrity of the USDA organic seal during this time of extreme market disruption, some of our concerns and recommendations may be unique from those raised by other sectors of agriculture.

Many of our recommendations were also suggested to Secretary Perdue as he developed his pandemic response package to implement the CARES Act but were not adequately addressed by that action.

Critical Rulemaking to Protect Organic Integrity Should Not Be Delayed by Pandemic

Two rulemakings that are critical to the economic health of the organic sector are in the final stages of clearance. Congress should reiterate the importance of publishing these two rules without delay:

  • The rulemaking to improve organic enforcement, both domestically and internationally, (aka the “strengthening organic enforcement” rule) is critical for the economic viability of the U.S. organic sector. This rule is more important now than ever to demonstrate that the U.S. is taking organic enforcement very seriously, so that fraudulent importers do not see the pandemic as opportunity to resume or expand fraudulent shipments. The 2018 Farm Bill required USDA to complete the rulemaking by December 19, 2019, but the proposed rule is still under review by OMB. This rulemaking must move forward.
  • The final rule on Origin of Livestock (OOL), to close loopholes in the organic standards related to the transitioning of conventional dairy cows into organic dairy operations, is another critical regulation for the organic sector. Through the Fiscal Year 2020 appropriations process, Congress mandated that USDA complete the OOL final rule by June 17, 2020.

Direct Support for Organic Farms, Diversified Farms, and Farms Servicing Local Markets

On April 17th, Secretary Perdue announced a plan to distribute $16 billion in direct payments to farmers, with specific amounts designated for certain commodities and livestock categories, as one of USDA’s actions to implement the CARES Act.

We are concerned that the payment formulas used by USDA to distribute the payments and the rigid delineation of funding for specific commodity and livestock categories will shortchange organic farmers, particularly small-and-medium-scale diversified operations that have been economically impacted by the pandemic. We urge Congress, in the next coronavirus response package, to be more explicit about providing direct assistance to organic and diversified farming operations and to establish oversight procedures to ensure USDA compliance with the requirement. The CARES Act was very specific that one of the priorities for direct payment assistance should be “producers that supply local food systems, including farmers markets, restaurants, and schools.” In spite of that, the USDA action plan to implement the CARES Act did very little to address the needs of that sector of agriculture. Using conventional commodity and livestock product price losses is not a good proxy for the type of losses experienced by organic farmers and farmers serving local markets.

Related to this concern is the fact that price data is not as widely available for organic agricultural products as it is for conventional products, which could make it more challenging for organic farmers to prove their losses relative to baseline prices. In the short term, this points to the need for Congress to provide alternate ways of proving loss for organic farmers. In the long term, this demonstrates the need for Congress to increase annual USDA Agricultural Marketing Service funding for segregated organic price data.

For some farmers serving local and direct-to-consumer markets, sales have actually gone up as a result of the pandemic as consumers seek out local sources of food. However, in many cases, costs have also skyrocketed for these operations because of the additional investments in equipment, technology, sanitation, staffing, and transportation that must be made in order to meet social distancing and infection prevention protocols. Their incomes may be going up, but their margins may actually be declining.

Therefore, we recommend that payments for smaller organic, diversified, and direct-market operations be based on total farm revenue relative to previous years, which allows for local and organic price premiums to be taken into account. This would also be a way to address operations whose sales have gone up, but whose margins have declined.

Lastly, the USDA payment formula provides the majority of assistance for losses from January through April 15th, with a much lower level of assistance for losses from April 16th through the following two quarters. For most farmers, losses did not begin until states started to close schools, farmers markets, and restaurants and issued stay-at-home orders. The timeframe for calculating the losses should be better coordinated with the timeframe of actual losses.

Streamlined and Expanded Organic Certification Cost-Share Assistance

Annual inspection is a requirement for all certified organic operations, and a core component to maintaining the integrity of the organic label. While some aspects of those inspections are taking place remotely during the pandemic, some on-site inspections are still happening using social distancing protocols.

Because of the economic disruption related to the pandemic, many organic farmers and handlers cannot currently afford to pay their certification fees. The federal government already reimburses up to 75 percent of organic certification fees, with a maximum reimbursement of $750 per certification scope per operation. As an emergency measure, we recommend that instead of reimbursing the organic operation for certification fees paid to certification agencies, USDA should reimburse the certification agency directly for those costs. In addition, the 75 percent reimbursement should be increased to a 100 percent reimbursement during the pandemic.

One of the barriers of access to organic meat and poultry is access to slaughter and processing plant space. In addition to the normal regulatory hurdles impacting smaller meat and poultry processing plants, organic meat and poultry processing standards add additional hurdles that make it very costly for a processing plant to process organic products. Since these additional hurdles are costs necessary for organic certification, USDA should provide certification cost share assistance to help defray the cost of organic meat and poultry processing to remove hurdles in the supply chain for organic meat and poultry. In addition to assistance with the specific costs of certification, recordkeeping, and segregation of product necessary to produce certified organic products, these small-scale plants would also benefit from assistance that is needed for all small-scale plants, including USDA staffing levels that ensure adequate inspection coverage for small plants and technical assistance and small plant outreach from USDA’s Food Safety and Inspection Service.

Assistance to Dairy Farmers

Dairy is one of the leading sectors of organic. Congress should re-open the 2020 sign-up period for the Dairy Margin Coverage (DMC) Program to allow new participants in the program. In addition, reopening the sign-up period would allow existing DMC participants to reconsider their coverage decisions for 2020 given the extraordinary and unforeseen dairy market collapse related to the pandemic.

Procedures for Donating Organic Food to Local Food Banks and Community Organizations

The agricultural product procurement and distribution plan announced by Secretary Perdue on April 17th does not work well for procurement and distribution of organic products to food banks and community organizations. The USDA plan operates primarily through existing wholesaler distribution firms who have been idled by the loss of food service markets related to the stay-at-home orders. While the USDA plan has no explicit prohibition on organic food distribution, the bidding process makes it challenging for food hubs and distributors of organic foods to win a bid.

We recommend that Congress establish a process for organic farmers, handlers or food hubs to be paid to distribute food directly to food banks and qualified community organizations. Either USDA would pay for the food directly or food banks would be given funds to procure local organic foods to fulfill their customers’ needs. Organic farmers are equally as impacted as other farmers by this crisis and market outlets for their products are equally important.

Protection and Reward for Front Line Workers and Businesses

Farms and food-related businesses have been designated as essential by the Department of Homeland Security and by most states. We agree with that designation. However, it is critical that we protect and reward those farmers, workers, and businesses who are providing these essential services during the pandemic.

Emergency grants should be provided to reimburse for expenses related to personal protection equipment (PPE) and pandemic-related facility, infrastructure, technology, and staffing modifications. Grants should be provided to farmers, farmers markets, organic certification agencies, small-and medium-scale grocery stores, including cooperative grocery stores, distributors, and small-and-medium-scale food processing plants.

In addition, federally funded pay bonuses should be provided to front line food system and grocery workers, to compensate them for their essential work under hardship conditions.

Flexibility in USDA Nutrition Program Rules and Spending Needed to Allow Low Income Consumers Greater Access to Nutritious Food During the Pandemic

In addition to refining the procurement process to be inclusive of all types of producers, as described above, we also urge Congress to increase funding for the Supplemental Nutrition Assistance Program (SNAP), which is a critical tool for providing a safety net against hunger. We also urge you to make several specific refinements to SNAP and other nutrition programs to make sure that the benefits of these programs are spread equitably across everyone in the food supply chain.

  • Allow Supplemental Nutrition Assistance Program (SNAP) payments to be made online directly to farms, CSAs, and cooperative grocery stores.

USDA has granted pilot program status to some States to allow SNAP recipients to make purchases on-line for home delivery of groceries to reduce their exposure to the coronavirus. Unfortunately, in most cases, the only USDA-approved retailers that can process and deliver the purchases are very large retailers, such as Walmart or Amazon.

The SNAP Online Purchasing Pilot should be expanded to all states and additional food marketing outlets, including cooperative grocers, other small-and-medium scale grocery stores, and farms with direct-to-consumer sales capability. USDA should provide technical assistance to help small-and-medium-sized retailers, community supported agriculture (CSA) operations, and farmers set up online capability to accept SNAP.

  • Provide waivers and direction to States to broaden their WIC-approved food lists to allow WIC participants to purchase organic foods.

As the economic downturn deepens as a result of the pandemic, the percent of consumers eligible for low-income food assistance programs such as SNAP and WIC will continue to grow. As low-income consumers struggle to afford access to healthy, nutritious food during these hard times, Congress should increase funding for the WIC program to meet growing demand and to enable states to allow more organic foods on their state WIC-approved food lists.

Farm Labor Accommodations Are Critical to Continuing Production of Organic Food During the Pandemic

With regard to farm workers, Congress should:

  • Establish a program to provide relief workers for sick farmers and farmworkers.
  • Provide farmworkers who are currently employed on a farm with the same payments as any other workers without questions about their status as citizens, and make farmworkers eligible for paid sick leave, SNAP, health coverage, childcare, and workmen's compensation.

Funding for Small Business Administration (SBA) Paycheck Protection Program and Economic Injury Disaster Loan (EIDL)

  • Funding for the Small Business Administration (SBA) Paycheck Protection Program and Economic Injury Disaster Loan (EIDL) programs should be replenished, and procedures to ensure farmers’ access to both programs should be expanded.
  • Congress should clarify that expenses paid with forgivable PPP loans are tax deductible.

We thank you for your efforts to respond quickly to the needs of organic farmers, businesses, retailers, workers and consumers in light of the COVID-19 pandemic.

Sincerely,

Abby Youngblood                                                                  Kate Mendenhall
Executive Director                                                                  Executive Director
National Organic Coalition                                                   Organic Farmers Association

 

 


Covid-19 Stimulus Package - Small Business Administration

Update June 20, 2020

This week, the Small Business Administration announced some updates to their programs to assist small businesses with the Covid-19 pandemic.

Paycheck Protection Program

** The deadline to apply for the PPP is June 30th. When this program was originally announced earlier this spring, the condition for the loan to be forgiven (the loan essentially becomes a grant) was that a business would have to keep everyone on their payroll or re-hire laid off staff within 8 weeks. That deadline has now been extended to 24 weeks from the date of the loan being approved, or by December 31, 2020, whichever comes first. You can read more about the PPP below or click here to get information from the SBA.

Economic Injury Disaster Loan

High demand had slowed down the process of getting applications to the EIDL program approved, and at one point, only agricultural business applications could submit new applications. As of June 15, the SBA is accepting new EIDL applications from all eligible small businesses and U.S. agricultural businesses. EIDL applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis. To learn more about eligibility and apply, click here and read the description below.

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UPDATE:  April 24, 2020

More Funding for Paycheck Protection Program:  OPEN April 27, 2020

Farms Now Eligible for Economic Injury Disaster Loan (EIDL)

This week, Congress passed a bill that provides more funding for the Paycheck Protection Program and makes farms eligible for the Economic Injury Disaster Loan (EIDL).
The new funding for the Paycheck Protection Program could be available as soon as Monday 4/27 and interest in this program is still extremely high, so contact your bank soon if you are interested (see article below for more details.)
If you are interested in the Small Business Administration's Economic Injury Disaster Loan process, start with this website: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options

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April 3, 2020

The CARES Act (the stimulus package passed in late March) sets up two main programs for small businesses, administered by the Small Business Administration.

Here is a flow chart from the House Small Business Committee that shows the difference between the two programs.

One program is Economic Injury Disaster Loans. This is a loan that has to be paid back, and as of April 2nd, it is not open to farms. Many groups, including OFA, are working to try to refine the requirements for this program so that farms can apply.

The other SBA program is the Paycheck Protection Program. This starts out as a loan, but if businesses keep people on the payroll for 8 weeks and the money is used for payroll, rent, mortgage interest, or utilities, the loan can be forgiven (or partially forgiven based on how long people stay on the payroll). Farms can apply to this program.

Food-related businesses should be able to apply to either program (if they meet all the criteria).

Banks approved by the Small Business Administration (including some in the farm credit system) are supposed to start processing Paycheck Protection Program applications on Friday, April 3rd and demand for the program is expected to be extremely high.

If you are considering applying for this program, contact your bank as soon as possible. (Or you can find a qualified lender on the SBA website).

The U.S. Department of Agriculture also received funding in the stimulus bill to direct aid to farms, including for specialty crop, livestock and producers who supply local markets. We do not yet know the details of how this money will be spent, but OFA is working to make sure that organic producers can qualify.

Useful Links:

Washington Post Article on How to Get Small Biz Loan: https://www.washingtonpost.com/business/2020/03/30/heres-how-get-small-business-loan-under-349-billion-coronavirus-aid-bill/

Small Business Owner's Gudie to the CARES Act:  https://delgado.house.gov/sites/delgado.house.gov/files/The%20Small%20Business%20Owner’s%20Guide%20to%20the%20CARES%20Act.pdf

Paycheck Protection Program Information from the Small Business Administration

Small Business Administration Covid-19 Relief Options

There are also other programs that the SBA uses for disaster lending (like micro loans and bridge loans), sometimes in cooperation with the states. Getting in touch with a SBA regional office or a Small Business Development Center is also a good idea to see if there are other programs that might work for you.