September Policy Update

September 2021

By Patty Lovera, Policy Director

Organic Certification Cost Share

On August 17th, USDA’s Farm Services Agency announced that funds were available for organic producers to apply for reimbursement of their 2021 organic certification costs. Unfortunately, this round of reimbursement is once again at the reduced level the agency implemented last year (50% up to $500 per certification scope). Producers can be reimbursed for expenses made between October 1, 2020 and September 30, 2021, including application fees, inspection costs, fees related to equivalency agreement requirements, travel expenses for inspectors, user fees, sales assessments and postage. 

OFA and our allies are still pushing USDA to restore the cost share reimbursement levels to the 75% up to $750 level that the program is authorized for by the last Farm Bill. Earlier this summer, in an announcement about special programs being rolled out to respond to the pandemic, USDA pledged to spend $20 million on organic certification cost share and assistance for organic transition. We are still waiting for details on this additional spending program. 

In the meantime, organic farmers should go to state department of agriculture or county FSA office to apply for the cost share assistance that is available right now. Your certifier should be able to help you find out who administers cost share in your state.

Changes to Whole Farm Revenue Insurance

On September 1, USDA announced changes to the Whole Farm Revenue Protection program for the 2022 season. Two of the changes could be make the program work better for organic producers:

  • Increasing expansion limits for organic producers to the higher of $500,000 or 35 percent. Previously, small and medium size organic operations were held to the same 35 percent limit to expansion as conventional practice producers.
  • Allowing a producer to report acreage as certified organic, or as acreage in transition to organic, when the producer has requested an organic certification by the acreage reporting date. This change fulfills one of the policy positions OFA adopted earlier this year.

You can read more about the changes to the Whole Farm Revenue program here

Pandemic Assistance for Farmers and Food Businesses

The USDA continues to roll out programs to address the impacts of the Covid-19 pandemic on the food system. A new program called the Pandemic Response and Safety Grant Program will give grants to food processors, distributors, farmers markets, and producers to respond to coronavirus, including for measures to protect workers. Funding requests may range from $1,500 to $20,000, and small businesses and non-profit organizations will be the focus of the first round of funding, with medium sized businesses becoming eligible in the second round. Approximately $650 million is available for grants for costs incurred between January 27, 2020 and December 31, 2021. Grants will cover the activities associated with workplace safety (including PPE), developing online platforms, retrofitting facilities, increasing worker transportation services, providing worker housing or medical service to deal with Covid-19. You can get more details on these grants here. The application for grants opens on September 23 and closes on November 8th.

Coronavirus Food Assistance Program Deadline Extended

In late August, USDA announced an extension to the Coronavirus Food Assistance Program 2, which provides direct payments to agricultural producers whose operations were directly impacted by the coronavirus pandemic. The original application period for CFAP 2 closed in December 2020 but USDA has reopened the signup period until October 12, 2021. The program uses three different methods for calculating payment rates based on the type of crops or livestock. Even if you were not eligible for the first round of CFAP (which was the case for many organic farms), it may be worth checking again because the USDA has changed some of the eligibility requirements and the methods for calculating payments, which may work better for organic farms. You can get details about who is eligible and how to apply here. 

Organic and Budget Reconciliation

Over the August recess and into September, Congress continued to move closer towards a plan to invest in the nation’s roads, bridges, public transit systems, broadband internet, energy grid and water systems through a bipartisan infrastructure package. The infrastructure package is more limited than some early proposals, which means that funding for things like agriculture and addressing climate change will be handled through a “reconciliation” bill that is passed only with Democratic votes. (This process can only be used a limited number of times and is supposed to be limited to funding existing government programs. It was used earlier this year to pass the American Rescue Plan to address economic impacts of the pandemic.) 

Yesterday, the House Agriculture Committee passed (with only Democratic votes) parts of the agriculture portions of the reconciliation package. We are still waiting for details on a reported $28 billion (to be spent over 10 years) for conservation programs, with a focus on climate change. But we do know that the agriculture bill as it is currently drafted contains a big increase for organic research. There are still several steps to go for this reconciliation package, and negotiations will continue to be fairly tense because of the very tight margins in both the House and the Senate. 

Horizon Organic Drops 89 Organic Dairy Farmers in the Northeast

Horizon Organic, which is owned by Danone, recently notified 89 organic dairy farmers in Maine, Vermont, New Hampshire and the northern part of New York that they would not be renewing their contract to buy their milk after next September. Danone is blaming logistics and trucking issues for their decision to drop these farmers from their routes. But there are  other issues in the organic marketplace are part of this story – especially USDA’s failure to update and enforce key organic standards for dairy cows such as enforcement of the pasture standards and long overdue updates to the Origin of Livestock rule to stop the continuous cycling of animals in and out of organic on large operations. 

In the absence of USDA upholding high standards for organic dairy operations, larger operations in the Midwest and West have gotten into the organic market, undercutting producers in the Northeast especially. It is extremely frustrating for producers in the Northeast to see USDA’s current focus on restoring resilience in the food supply chain and encouraging more farmers to transition to organic, while at the same time USDA’s failure to strengthen the standards for organic dairy is leading to producers potentially being pushed out of the industry. OFA is working with allies like the Northeast Organic Dairy Producers Alliance and others in the region to identify other options for the impacted dairy operations, call on Horizon to offer these farms more time and more financial support and to pressure USDA to strengthen the organic standards so that all organic dairy farms are following the same rules, no matter where they are.