USDA’s Coronavirus Food Assistance Program
June 16, 2020
(CFAP) Direct Payments
Randy : November 19, 2020
Round One (CFAP-1)
Randy Schnepf
On April
On April
17, 2020, Secretary of Agriculture Sonny Perdue announced that the U.S. 17, 2020, Secretary of Agriculture Sonny Perdue announced that the U.S.
Department
Specialist in Agricultural
Specialist in Agricultural
Department of Agriculture (USDA) would initiateof Agriculture (USDA) would initiate
the what would be the first round of the
Policy
Coronavirus Food Assistance Program (CFAPCoronavirus Food Assistance Program (CFAP
-1) to ) to
Policy
provide immediate financial relief toprovide immediate financial relief to
farmers, ranchers, and consumers in response to the farmers, ranchers, and consumers in response to the
COVID-19 national emergency. COVID-19 national emergency.
CFAP
CFAP-1 consists of two distinct initiatives: a $16 consists of two distinct initiatives: a $16
billion bil ion direct direct
payment program for agricultural producers payment program for agricultural producers
that have been impacted by the decline in impacted by the decline in
commodity prices and the disruption in food supply chains commodity prices and the disruption in food supply chains
related to COVID-19, and a $3 related to COVID-19, and a $3
billion bil ion food purchase and distribution program. This report focuses on the larger of these two CFAPfood purchase and distribution program. This report focuses on the larger of these two CFAP
-1 initiatives—the $16 initiatives—the $16
billion bil ion direct payment program. The direct payment program. The
CFAP direct payment program derives its funding from two sources: $9.5 direct payment program derives its funding from two sources: $9.5
billionbil ion emergency emergency
program spending authorized by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act; P.L. 116-136) and an program spending authorized by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act; P.L. 116-136) and an
existing $6.5 billion balance fromadditional $6.5 bil ion made available by Secretary Sonny Perdue via his budgetary authority under the Commodity Credit Corporation (CCC) Charter Act of 1948 (P.L. 80-806; 15 U.S.C. the Commodity Credit Corporation (CCC) Charter Act of 1948 (P.L. 80-806; 15 U.S.C.
714 et seq.).
714 et seq.).
USDA’s Farm Service Agency (FSA) is the principal agency charged with implementing CFAP-1’s direct payment program. FSA was assisted by the Agricultural Marketing Service (AMS) with respect to matters dealing with producers of specialty crops. On May 19, 2020, USDA released the final rule that details CFAPOn May 19, 2020, USDA released the final rule that details CFAP
-1’s $16 ’s $16
billion bil ion direct payment program, including the list of direct payment program, including the list of
eligible eligible commodities, eligibilitycommodities, eligibility
requirements for producers, payment calculations, and application procedures. In its requirements for producers, payment calculations, and application procedures. In its
announcement, USDA stated that it would begin announcement, USDA stated that it would begin
accepting applications on May 26, through accepting applications on May 26, through
the Farm Service Agency (FSA), FSA, from agricultural producers who have suffered losses. To be eligible,from agricultural producers who have suffered losses. To be eligible,
an application an application
musthad to be submitted to any FSA county be submitted to any FSA county
office by the close of business on August 28, office by the close of business on August 28,
2020—the application period was later extended to September 11, 2020. Payments to eligible producers 2020. Payments to eligible producers
are expectedwere to be made soon after each to be made soon after each
application application
is processed. USDA’s FSA will be the principal agency charged with implementing CFAP’s direct payment program. FSA is to be assisted by the Agricultural Marketing Service (AMS) with respect to matters dealing with producers of specialty crops. was processed.
To be eligible
To be eligible
for a payment, a commodity must have suffered a price loss of at least 5% during the mid-January for a payment, a commodity must have suffered a price loss of at least 5% during the mid-January
to mid-Aprilto mid-April
period, or was subject to additional significant marketing costs for unexpected supply chain disruptions, including unsold period, or was subject to additional significant marketing costs for unexpected supply chain disruptions, including unsold
inventories. Specialty crops may also qualify for a payment if product was shipped off the farm, but spoiled prior to receipt of inventories. Specialty crops may also qualify for a payment if product was shipped off the farm, but spoiled prior to receipt of
payment due to COVID-19-caused disruption of the food supply chain. For an individualpayment due to COVID-19-caused disruption of the food supply chain. For an individual
or legal entity to be eligible,or legal entity to be eligible,
they they
must complete an application to determine the quantities affected and must complete an application to determine the quantities affected and
to meet certain other criteria, including conservation meet certain other criteria, including conservation
compliance, share in the risk of profit and loss compliance, share in the risk of profit and loss
from the farm’s operation, and an average Adjusted Gross Income (AGI) for from the farm’s operation, and an average Adjusted Gross Income (AGI) for
2016, 2017, and 2018 that is less than $900,000, unless at least 75% of AGI is from farming and ranching activities. 2016, 2017, and 2018 that is less than $900,000, unless at least 75% of AGI is from farming and ranching activities.
USDA is to track payments made from the CARES Act and the CCC Charter Act funds separately, to ensure that the USDA is to track payments made from the CARES Act and the CCC Charter Act funds separately, to ensure that the
payments are consistent with each respective authority. As a result, every eligiblepayments are consistent with each respective authority. As a result, every eligible
commodity may receive a payment based commodity may receive a payment based
on two different types of losses or costs: (1) income losses due to mid-January-to-mid-April price declines, which is to be on two different types of losses or costs: (1) income losses due to mid-January-to-mid-April price declines, which is to be
partially
partial y offset by payments from CARES Act funds; and (2) unexpected marketing costs due to food supply chain offset by payments from CARES Act funds; and (2) unexpected marketing costs due to food supply chain
disruptions, which is to be disruptions, which is to be
partiallypartial y offset by payments from CCC funds. offset by payments from CCC funds.
USDA is to pay an initial tranche equal to 80% of the aggregate payment to each qualifying producer. If funds remain available after the initial payment to all eligible applicants, and depending on whether USDA adds other commodities to the list, USDA is to disburse the remaining funds such that the initial and final payments do not exceed a total of $9.5 billion of CARES Act funds and $6.5 billion of CCC funds. Funds may be prorated if necessary to stay within these limits. There is a There is a
payment limitation of $250,000 per person or entity for payment limitation of $250,000 per person or entity for
all al commodities combined. Applicants who are corporations, limited commodities combined. Applicants who are corporations, limited
liability companies, or limited partnerships may qualify for payments of up to $750,000 if at least three members each liability companies, or limited partnerships may qualify for payments of up to $750,000 if at least three members each
actively provide at least 400 hours of personal labor or personal management to the farming operation. actively provide at least 400 hours of personal labor or personal management to the farming operation.
Congress may be interested in evaluating
Congress may be interested in evaluating
whether CFAPwhether CFAP
-1 payments mitigate the damage caused by the COVID- payments mitigate the damage caused by the COVID-
19 pandemic 19 pandemic
for individualfor individual
farming operations. Will additional assistance be necessary later this year? Is additional assistance needed to support farming operations and incentivize participation for al eligible producers, as wel as whether additional assistance might be necessary to assist certain affected industries that are not eligible certain affected industries that are not eligible
under under
USDA’s final expanded eligibility list.USDA’s initial rollout? Another immediate concern may be Another immediate concern may be
oversight of the large sums of taxpayer money that oversight of the large sums of taxpayer money that
are to flow out through the USDA and the CCC. Producer self-flow out through the USDA and the CCC. Producer self-
certification of losses may create an incentive to over-report losses. certification of losses may create an incentive to over-report losses.
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USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments: Round One (CFAP-1)
Contents
Introduction ..................................................................................................................................... 2 1
CFAP-1 Includes Two Programs .................................................................................................. 2
Report Overview ............. 1
Report Overview .......................................................................................................... 2 1
CFAP-1 Direct Payment Program Overview ...................................................................................... 3 2
USDA Authorized to Design and Implement CFAP-1 ................................................................. 3
Funding for CFAP Direct Payments ............ 2 Funding for CFAP Direct Payments .............................................................................. 4
Eligibility Criteria for CFAP Direct Payments .......................................................................... 5 4
Eligible Commodities ......................................................................................................... 5 4
Request for Additional Commodities ...... ............................................................................ 6
Ineligible Commodities ......................................................................................... 7 Eligible Producers .............. 7
Eligible Producers .................................................................................. 7
CFAP-1 Direct Payment Calculations ............................. 7
CFAP Direct Payment Calculations .................................................... 8
Projected CFAP-1 Direct Payment Outlays ............................................. 8
Projected CFAP Direct Payment Outlays ..................... 10 CFAP-1 Application Process ........................................................... 10
CFAP Application Process .............................. 12
Producer Data Subject to Verification ......................................................................... 11
Producer Data Subject to Verification ...13 Initial Payment Tranche of 80% ................................................................................... 11
Initial Payment Tranche of 80% 13 Payment Limits ....................................................................................................... 12
Payment Limits13
Issues for Congress ....................................................................................................................... 12
Issues for Congress 14
Figures Figure 1. CFAP-1 Payments by Commodity ........................................................................ 11 Figure 2. CFAP-1 Payments by State............................................................... 13
Figures
Figure 1. Projected CFAP Net Payments by Commodity After Payment Limitations ................... 11
................. 12
Tables
Table 1. CFAP-1: Eligibility Criteria and Eligible Commodities by Category .............................................. 5
Table 2. CFAP-1 Payment Formula by Commodity Category ............................................................ 8 9
Table A-1. CFAP-1 Payment Rates (PRs): Non-Specialty Crops, Dairy, & Livestock.. ................... 14 17
Table A-2. CFAP-1 Payment Rates (PRs): for Specialty Crops .............................................. 19 Table A-3. CFAP-1 Payment Rates for Liquid and Frozen Eggs and Aquaculture .................... 25............... 16
Table A-3. Additional USDA Forms for CFAP Eligibility ................4. Chronology of CFAP-1 Regulatory Amendments and Corrections ......................... 26 Table A-5. Additional USDA Forms for CFAP Eligibility ............................................ 19
........ 28
Appendixes
Appendix. Supplementary Tables .................................................................................................. 14 17
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Contacts Author Information
Contacts
Author Information ........................................................................................................................ 19 28
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165 USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments: Round One (CFAP-1)
Introduction
On AprilOn April
17, 2020, Secretary of Agriculture Sonny Perdue announced that the U.S. Department of 17, 2020, Secretary of Agriculture Sonny Perdue announced that the U.S. Department of
Agriculture (USDA) would initiate Agriculture (USDA) would initiate
what would be the first round of the Coronavirus Food Assistance Program (CFAPthe Coronavirus Food Assistance Program (CFAP
-1), valued at ), valued at
$19 billion, $19 bil ion, to provide immediate financial relief to to provide immediate financial relief to
farmers, ranchers, and consumers in response farmers, ranchers, and consumers in response
to the COVID-19 national emergency.1to the COVID-19 national emergency.1
CFAP-1 Includes Two Programs
According to Secretary Perdue, CFAPAccording to Secretary Perdue, CFAP
-1 consists of two distinct initiatives: a $16 consists of two distinct initiatives: a $16
billion bil ion direct direct
payment program for agricultural producers that have been impacted by the decline in commodity payment program for agricultural producers that have been impacted by the decline in commodity
prices and the disruption in food supply chains related to COVID-19, and a $3 prices and the disruption in food supply chains related to COVID-19, and a $3
billion bil ion food food
purchase and distribution program for affected consumers referred to as the Farmers to Families purchase and distribution program for affected consumers referred to as the Farmers to Families
Food Box Program.Food Box Program.
These two programs
These two programs
—the direct payments and food box programs—derive their specific funding from different sources, and are being derive their specific funding from different sources, and are being
implemented by different agencies within USDA. The $16 implemented by different agencies within USDA. The $16
billion bil ion designated for the direct designated for the direct
payments program is funded from $9.5 payments program is funded from $9.5
billionbil ion of emergency spending authorized by the of emergency spending authorized by the
Coronavirus Aid, Relief, and Economic Security Act (CARES Act; P.L. 116-136) and an Coronavirus Aid, Relief, and Economic Security Act (CARES Act; P.L. 116-136) and an
existing $6.5 billion balance fromadditional $6.5 bil ion made available by the Secretary of Agriculture via his
budgetary authority under the Commodity Credit Corporation (CCC) Charter Act of 1948 (P.L. the Commodity Credit Corporation (CCC) Charter Act of 1948 (P.L.
80-806; 15 U.S.C. 714 80-806; 15 U.S.C. 714
et seq.).2 The $3 ).2 The $3
billionbil ion for the commodity purchase portion of CFAP is for the commodity purchase portion of CFAP is
funded from the Families First Coronavirus Response Act (FFCRA; P.L. 116-127, §1101(g)) that funded from the Families First Coronavirus Response Act (FFCRA; P.L. 116-127, §1101(g)) that
authorizes USDA to purchase commodities for emergency distribution in the United States.3 authorizes USDA to purchase commodities for emergency distribution in the United States.3
USDA, through its Agricultural Marketing Service (AMS), began food purchase and distribution
USDA, through its Agricultural Marketing Service (AMS), began food purchase and distribution
activities within a week of announcing the CFAP. In contrast, the direct payment component of activities within a week of announcing the CFAP. In contrast, the direct payment component of
CFAPCFAP
-1 is being implemented by USDA’s Farm Service Agency (FSA) is being implemented by USDA’s Farm Service Agency (FSA)
., with assistance from
AMS for specialty crop producer enrollments.4 FSA went through a longer FSA went through a longer
(albeit expedited) (albeit expedited)
rulemaking process to determine how payments would be made.rulemaking process to determine how payments would be made.
Report Overview
This report describes the details of the This report describes the details of the
larger of these two CFAP initiatives—the direct payment programdirect payment component of the CFAP-1 initiative. It describes how this program is funded and administered, including specific details on . It describes how this program is funded and administered, including specific details on
the the
calculation and implementation of payments. It includes the program changes made by USDA through a series eight subsequent amendments and corrections to CFAP-1 that expanded program
1 USDA, “USDA Announces Coronavirus Food Assistance Program,” Press Release no. 0222.20, April 17, 2020. On September 18, 2020, USDA announced a second round of CFAP payments (CFAP -2) valued at up to an additional $14 billion—USDA, “ USDA to Provide Additional Direct Assistance to Farmers and Ranchers Impacted by the Coronavirus,” Press Release No. 0378.20, September 18, 2020. 2 USDA, FSA, “Coronavirus Food Assistance Program,” 85 Federal Register 30825, May 21, 2020. 3 Agricultural Marketing Service (AMS), “Notice of Funds Availability (NOFA); Purchase of Fruit, Vegetable, Dairy, and Meat Products Due to COVID-19 National Emergency-USDA Food Box Distribution Program,” 85 Federal Register 23325, April 27, 2020. T he President announced on August 24, 2020, that up to an additional $1 billion was being made available for deliveries under this program through October 31, 2020 —for details, see USDA, AMS, “USDA Farmers to Families Food Box,” at https://www.ams.usda.gov/selling-food-to-usda/farmers-to-families-food-box.
4 See footnote 2.
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eligibility to additional commodities, updated payment rates, and added clarity to program
definitions.5
The report begins with a brief overview of the CFAP-1 direct payment program, including its
policy objectives, funding sources, and implementing agencies. The next section describes the details of the CFAP-1 direct payment program, including eligibility requirements for both producers and commodities, application procedures, payment calculations, and the program’s timeline. The report ends with a brief discussion on issues of potential interest to Congress. An Appendix at the end of the report includes supplementary tables that provide details on USDA’s
derivation of the payment rates for affected commodities under both CARES Act and CCC Charter Act criteria, as wel as additional USDA forms that must be completed by producers for
payment eligibility.calculation and implementation of payments.
The report begins with a brief overview of the CFAP direct payment program, including its policy objectives, funding sources, and implementing agencies. The next section describes the details of the CFAP direct payment program, including eligibility requirements for both producers and commodities, application procedures, payment calculations, and the program’s timeline. The report ends with a brief discussion on issues of potential interest to Congress. An Appendix at the end of the report includes supplementary tables that provide details on USDA’s derivation of the payment rates for affected commodities under both CARES Act and CCC Charter Act criteria, as well as additional USDA forms that must be completed by producers for payment eligibility.
1 USDA, “USDA Announces Coronavirus Food Assistance Program,” Release No. 0222.20, April 17, 2020. 2 USDA, FSA, “Coronavirus Food Assistance Program,” 85 Federal Register 30825, May 21, 2020. 3 Agricultural Marketing Service, “Notice of Funds Availability (NOFA); Purchase of Fruit, Vegetable, Dairy, and Meat Products Due to COVID-19 National Emergency-USDA Food Box Distribution Program,” 85 Federal Register 23325, April 27, 2020.
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USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments
An earlier report by CRS provides information on how the COVID-19 pandemic affected the U.S.
An earlier report by CRS provides information on how the COVID-19 pandemic affected the U.S.
food supply chain—including its deleterious impact on agricultural producers—and precipitated food supply chain—including its deleterious impact on agricultural producers—and precipitated
the congressional and USDA actions described here.the congressional and USDA actions described here.
46 This earlier report also provides details on This earlier report also provides details on
the CFAPthe CFAP
-1 food purchase and distribution initiative and its Farmers to Families Food Box food purchase and distribution initiative and its Farmers to Families Food Box
program. program.
Those events and programs are not reviewed here.
CFAPFor details on the Farmers to Families Food Box Program and other nutrition-related
relief programs that responded to the COVID-19 pandemic, see CRS Report R46432, Food Banks
and Other Emergency Feeding Organizations: Federal Aid and the Response to COVID-19.
CFAP-1 Direct Payment Program Overview
USDA Authorized to Design and Implement CFAP-1
Under the CARES Act, Congress delegated broad authority to USDA to develop and administer a Under the CARES Act, Congress delegated broad authority to USDA to develop and administer a
support program in response to COVID-19.support program in response to COVID-19.
57 In particular, the CARES Act In particular, the CARES Act
provides $9.5 billionprovided $9.5 bil ion for USDA to “prevent, prepare for, and respond to coronavirus by providing support to for USDA to “prevent, prepare for, and respond to coronavirus by providing support to
agricultural producers impacted by coronavirus, including producers of specialty crops, producers agricultural producers impacted by coronavirus, including producers of specialty crops, producers
that supply local food systems, including farmers’ markets, restaurants, and schools, and livestock that supply local food systems, including farmers’ markets, restaurants, and schools, and livestock
producers, including dairy producers.”producers, including dairy producers.”
68 This approach provides funding to the Secretary of This approach provides funding to the Secretary of
Agriculture with general authority to respond to a crisis, and therefore is similar to emergency Agriculture with general authority to respond to a crisis, and therefore is similar to emergency
appropriations for wildfires and hurricanes in 2018 and 2019 in which USDA was tasked to appropriations for wildfires and hurricanes in 2018 and 2019 in which USDA was tasked to
develop a payment program from a general appropriation.develop a payment program from a general appropriation.
79
Similarly, USDA interprets the CCC Charter Act as providing broad authority to use CCC funds
Similarly, USDA interprets the CCC Charter Act as providing broad authority to use CCC funds
in support of U.S. agriculture.8 Based on these broad authorities, USDA developed the CFAP direct payment program.
On May 19, 2020, USDA released a final rule to implement CFAP’s $16 billion direct payment program including eligibility requirements for commodities and producers, application procedures, and payment calculations.9 In its announcement, USDA stated that it would begin accepting applications on May 26, through the Farm Service Agency (FSA), from agricultural producers who have suffered losses.10 All applications must be received by August 28, 2020.
FSA is to be the principal agency charged with implementing CFAP’s direct payment program. AMS is to assist FSA with respect to specialty crops issues, such as determinations of sales prices and marketing costs.
CFAP direct payments are to provide financial assistance to producers and ranchers of agricultural commodities that suffered from price declines of at least 5% between mid-January and mid-April, or who face additional significant marketing costs associated with unexpected carrying-costs of unsold commodities or spoilage due to market supply chain disruptions. The 4 CRS to support the orderly production and marketing of agricultural commodities via normal marketing channels that have been disrupted by the COVID-19 pandemic.10 Based on these broad
authorities, USDA developed the CFAP direct payment program.
5 See Table A-4 for a chronological list of regulatory amendments and corrections as posted in the Federal Register. 6 CRS Report R46347, Report R46347,
COVID-19, U.S. Agriculture, and USDA’s Coronavirus Food Assistance Program (CFAP) . 7 T he. 5 The CARES CARES
Act (P.L. 116-136), Division B—Emergency Appropriations For Coronavirus Health Response And Act (P.L. 116-136), Division B—Emergency Appropriations For Coronavirus Health Response And
Agency Operations, Agency Operations,
TitleT itle I, Agricultural Programs, Office of the Secretary. I, Agricultural Programs, Office of the Secretary.
6 8 USDA, USDA,
“USDA“USDA
Announces Coronavirus Food Assistance Program,” Release No. 0222.20, April 17, 2020. Published Announces Coronavirus Food Assistance Program,” Release No. 0222.20, April 17, 2020. Published
in the Federal Register on May 21, 2020 (85 in the Federal Register on May 21, 2020 (85
Federal Register 30825). 30825).
79 For example, see CRS For example, see CRS
In FocusIn Focus
IF11245, IF11245,
FY2019 Supplemental Appropriations for Agriculture. .
810 For a discussion For a discussion
of USDA’sof USDA’s
authority under the CCC Charter Act, see CRSauthority under the CCC Charter Act, see CRS
Report R44606, Report R44606,
The Commodity Credit
Corporation: In Brief. .
9 USDA, “USDA Announces Details of Direct Assistance to Farmers through the Coronavirus Food Assistance Program,” News Release, May 19, 2020.
10 For up-to-date program information, including application forms and payment processing information, visit the USDA FSA web portal for CFAP at https://www.farmers.gov/cfap.
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USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments
CFAP direct payment program stands in contrast to congressionally authorized farm bill support programs, Congressional Research Service
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link to page 30 USDA’s Coronavirus Food Assistance Program: Round One (CFAP-1)
FSA is the principal agency charged with implementing CFAP-1’s direct payment program. AMS assists FSA with respect to specialty crops issues, such as determinations of sales prices and marketing costs. On May 19, 2020, USDA released a final rule to implement CFAP-1’s $16 bil ion direct payment program including eligibility requirements for commodities and producers, application procedures, and payment calculations.11 In its announcement, USDA stated that it would begin accepting applications on May 26, through the Farm Service Agency (FSA), from
agricultural producers who had suffered losses.12 Initial y, the deadline for CFAP-1 applications
was August 28, 2020; however, the application deadline was extended to September 11, 2020.13
CFAP-1 direct payments provide financial assistance to producers and ranchers of agricultural commodities that suffered from price declines of at least 5% between mid-January and mid-April, or who face additional significant marketing costs associated with unexpected carrying-costs of unsold commodities or spoilage due to market supply-chain disruptions. The CFAP-1 direct payment program stands in contrast to congressional y authorized farm bil support programs, supplemental assistance, and other USDA-initiated payment programs for both its supplemental assistance, and other USDA-initiated payment programs for both its
scale ($16 scale ($16
billion)
bil ion) and its complicated payment formulation.and its complicated payment formulation.
11 The CFAP14 CFAP-1 separates COVID- separates COVID-
related injury into two components (income losses due to price declines, and unexpected related injury into two components (income losses due to price declines, and unexpected
marketing costs due to food supply chain disruptions), each with its own distinct funding marketing costs due to food supply chain disruptions), each with its own distinct funding
source—the CARES Act and the CCC, respectively. The payments calculated for each of these source—the CARES Act and the CCC, respectively. The payments calculated for each of these
two funding sources for each two funding sources for each
eligible eligible commodity are combined into a single payment per commodity are combined into a single payment per
producer, producer,
with an initial tranche which is distributed in two
tranches. The first tranche is equal to 80% of the combined payment for which each equal to 80% of the combined payment for which each
qualifying qualifying
producer is potential y eligible. The second tranche is conditional on funds available after distribution of the first tranche and may be prorated as needed to avoid exceeding the program’s
$16 bil ion spending limit. This unusual payment formulation is explained in this report.
On September 18, 2020, USDA announced a second round of CFAP payments (CFAP-2) valued at up to an additional $14 bil ion from the CCC. 15 USDA’s ability to provide $14 bil ion in CFAP-2 funding in September may have been contingent on a CARES Act early replenishment payment of $14 bil ion for the CCC that did not become available until later in the summer.16
Congress is also considering providing additional support, including support for additional agricultural commodities and sectors that were not initial y eligible under CFAP-1.17 These
potential additional efforts are not discussed in this report.
11 USDA, “ USDA Announces Details of Direct Assistance to Farmers through the Coronavirus Food Assistance Program,” News Release, May 19, 2020. T he May 19 rule was subsequently amended and/or corrected by a series of eight additional entries in the Federal Register as listed in Table A-4. 12 For up-to-date program information, including application forms and payment processing information, visit the USDA FSA web portal for CFAP at https://www.farmers.gov/cfap.
13 T he deadline was extended by USDA, 85 Federal Register 49593, August 14, 2020. 14 T he proposed CFAP direct payments program would exceed previous USDA ad hoc direct payment programs of large scale, including the market loss assistance payments of 1999 ($3 billion), 2000 ($11 billion), and 2001 ($5.5 billion); source: USDA, Economic Research Service (ERS), Farm Income and Wealth Statistics, at producer is potentially eligible. This unusual payment formulation is explained in this report.
USDA could provide additional financial assistance for the U.S. agricultural sector beyond CFAP later in the summer when a replenishment payment of $14 billion for the CCC becomes available. Congress is also considering providing additional support, including support for additional agricultural commodities and sectors that were not initially eligible under CFAP.12 These potential additional efforts are not discussed in this report.
Funding for CFAP Direct Payments
Funding for CFAP’s direct payment program is from two sources: $9.5 billion from the CARES Act, and $6.5 billion obtained with existing USDA authorities under the CCC Charter Act.13 USDA states that each of these funding sources has its own specific authority and, as a result, USDA is to use the funds from each source in a manner that USDA interprets as being consistent with that authority.14
USDA is to use the $9.5 billion of CARES Act funding to compensate producers
for commodity and livestock losses due to price declines of at least 5% that occurred between mid-January 2020 and mid-April 2020. In the case of specialty crops, the funding is to compensate for losses associated with products that were shipped from the farm by April 15, but spoiled due to market disruptions, resulting in no payment.
USDA is to use $6.5 billion of CCC funding to compensate producers for
unexpected costs due to on-going market disruptions and to assist with the transition to a more orderly marketing system as the pandemic wanes.
Thus, each of these funding sources are to be used for different types of losses or costs—CARES Act payments for price declines, and CCC payments for unexpected marketing costs. Such 11 The proposed CFAP direct payments program would exceed previous USDA ad hoc direct payment programs of large scale, including the market loss assistance payments of 1999 ($3 billion), 2000 ($11 billion), and 2001 ($5.5 billion), source: USDA, Economic Research Service (ERS), Farm Income and Wealth Statistics, https://www.ers.usda.gov/data-products/farm-income-and-wealth-statistics/; and the market facilitation payment (MFP) https://www.ers.usda.gov/data-products/farm-income-and-wealth-statistics/; and the market facilitation payment (MFP)
programs of 2018 ($8.6 billion) and 2019 ($14.5 billion), source: USDA,programs of 2018 ($8.6 billion) and 2019 ($14.5 billion), source: USDA,
FSA,FSA,
Market Facilitation Program, Market Facilitation Program,
at https://www.farmers.gov/manage/mfp. https://www.farmers.gov/manage/mfp.
12 On May 15, 2020, the House passed the HEROES Act (H.R. 6800), which would 15 USDA, “USDA to Provide Additional Direct Assistance to Farmers and Ranchers Impacted by the Coronavirus,” Press Release No. 0378.20, September 18, 2020.
16 CARES Act (P.L. 116-136), Division B—Emergency Appropriations For Coronavirus Health Response And Agency Operations, T itle I—Agricultural Programs, §11002, CCC, Reimbursement of Present Net Realized Losses. 17 On May 15, 2020, the House passed the HEROES Act (H.R. 6800), which would authorize $16.5 billion in authorize $16.5 billion in
additional direct payments by the Secretary of additional direct payments by the Secretary of
Agriculture. Agricult ure. Among its provisions, the bill wouldAmong its provisions, the bill would
compensate producers who have had to dispose of livestock and poultry that could not be sold due to processing disruptions, and would provide special assistance targeted to dairy producers. It further includes aid targeted to biofuels plants, fruit and vegetable growers, and local agriculture.
13 For a discussion of USDA’s authority under the CCC Charter Act, see CRS Report R44606, The Commodity Credit
Corporation: In Brief.
14 USDA, FSA, “Coronavirus Food Assistance Program,” 85 Federal Register 30825, May 21, 2020.
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compensate producers
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Funding for CFAP Direct Payments Funding for CFAP-1’s direct payment program is from two sources: $9.5 bil ion from the CARES
Act, and $6.5 bil ion obtained with existing USDA authorities under the CCC Charter Act.18 USDA states that each of these funding sources has its own specific authority and, as a result, USDA is to use the funds from each source to implement CFAP-1 in a manner that USDA
interprets as being consistent with that authority.19
USDA is to use the $9.5 bil ion of CARES Act funding to compensate producers for commodity and livestock losses due to price declines of at least 5% that occurred between mid-January 2020 and mid-April 2020. In the case of specialty crops, the funding also is to compensate for losses associated with products that were shipped from the farm by April 15, but spoiled due to market
disruptions, resulting in no payment.
USDA is to use $6.5 bil ion of CCC funding to compensate producers for unexpected costs due to on-going market disruptions and to assist with the transition to a more orderly marketing system
as the pandemic wanes.
Thus, each of these funding sources are to be used for different types of losses or costs—CARES
Act payments for price declines and subsequent sales losses and CCC payments for unexpected marketing costs. Such marketing costs may include the removal or disposition of surplus agricultural commodities, the marketing costs may include the removal or disposition of surplus agricultural commodities, the
purchase of materials and facilities required to produce and market agricultural commodities, and purchase of materials and facilities required to produce and market agricultural commodities, and
aid in the development of new markets, marketing facilities, and uses for such commodities.aid in the development of new markets, marketing facilities, and uses for such commodities.
USDA has stated that it USDA has stated that it
will wil track payments made from the CARES Act and the CCC Charter Act track payments made from the CARES Act and the CCC Charter Act
funds separately, to ensure that the payments are consistent with funds separately, to ensure that the payments are consistent with
each respective authority. each respective authority.
Nonetheless, USDA is to combine payments made under both CARES Act and CCC funds into a Nonetheless, USDA is to combine payments made under both CARES Act and CCC funds into a
single payment for eligiblesingle payment for eligible
producers. Thus, a producer producers. Thus, a producer
will wil need to need to
complete only one CFAPcomplete only one CFAP
-1 payment application. payment application.
Eligibility Criteria for CFAP Direct Payments
USDA has developed criteria to determine which commodities and which producers are eligible USDA has developed criteria to determine which commodities and which producers are eligible
for CFAPfor CFAP
support.15-1 support (Table 1). Eligibility Eligibility
criteria for producers builds off of general USDA criteria for producers builds off of general USDA
program eligibility
program eligibility criteria, whereas criteria identifying eligiblecriteria, whereas criteria identifying eligible
commodities commodities
isare largely unique to largely unique to
the CFAPthe CFAP
-1 program and program and
variesvary by commodity groups. by commodity groups.
Eligible Commodities
According to USDA, only commodities produced in the United States are eligible
According to USDA, only commodities produced in the United States are eligible
for CFAPfor CFAP
-1 direct payments. In addition, USDA has specified certain eligibilitydirect payments. In addition, USDA has specified certain eligibility
criteria for each of the major criteria for each of the major
agricultural commodity groups that includes a agricultural commodity groups that includes a
nationwide price decline of at least 5% from January 15, 2020, price decline of at least 5% from January 15, 2020,
to April 15, 2020, and/or unexpected marketing costs (including spoilage) as listed ito April 15, 2020, and/or unexpected marketing costs (including spoilage) as listed i
n Table 1. Based on an analysis of these criteria, USDA has determined that the commodities listed iBased on an analysis of these criteria, USDA has determined that the commodities listed i
n Table
1 are eligibleare eligible
for either a price-decline or marketing-cost paymentfor either a price-decline or marketing-cost payment
.
Table 1. Eligibility Criteria and Eligible Commodities by Category
Category
Eligibility Criteria and Eligible Commodities
Non-Specialty Eligibility Criteria: Non-specialty crop producers who have suffered at least a 5% price Cropsa
decline , or
possibly both.
who have had to dispose of livestock and poultry that could not be sold due to processing disruptions, and would provide special assistance targeted to dairy producers. It further includes aid targeted to biofuels plants, fruit and vegetable growers, and local agriculture.
18 For a discussion of USDA’s authority under the CCC Charter Act, see CRS Report R44606, The Commodity Credit Corporation: In Brief. 19 USDA, FSA, “Coronavirus Food Assistance Program,” 85 Federal Register 30825, May 21, 2020.
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Table 1. CFAP-1: Eligibility Criteria and Eligible Commodities by Category
Category
Eligibility Criteria and Eligible Commodities
Non-Specialty
Eligibility Criteria: Non-specialty crop producers who suffered at least a 5% price decline
Cropsa
between mid-January and mid-April (seebetween mid-January and mid-April (see Table A-1), and who face increased , and who face increased
marketing costs for unpriced inventories as of January 15, 2020 (marketing costs for unpriced inventories as of January 15, 2020 (
seesee Table 2).
Eligible Non-Specialty Crops:: Malting barley, canola, corn, upland cotton, mil et, Malting barley, canola, corn, upland cotton, mil et,
oats, oats,
soybeans, sorghum, sunflowers,soybeans, sorghum, sunflowers,
durum wheat, and hard red spring wheat.durum wheat, and hard red spring wheat.
Also eligible under these criteria are liquid and frozen eggs.
Livestock
Eligibility Criteria: Livestock Livestock
producers who producers who
have suffered at least a 5% price decline suffered at least a 5% price decline
between
Commodities
between mid-January and mid-Aprilmid-January and mid-April
(see Table A-1), and who face increased, and who face increased
marketing costs marketing costs
for unpriced inventoriesfor unpriced inventories
as of January 15, 2020as of January 15, 2020
(see Table 2).
Eligible Livestock Commodities:b CattleCommodities:b Cattle, hogs and pigs, and sheep (, hogs and pigs, and sheep (
lambs and yearlingsincluding lambs, yearlings, and al other sheep). ).
Wool
Eligibility Criteria: Wool Wool
producers who producers who
have suffered at least a 5% price declinesuffered at least a 5% price decline
between between
mid-January and mid-Aprilmid-January and mid-April
(see Table A-1), and who face increased marketing, and who face increased marketing
costs for unpriced inventories costs for unpriced inventories as of January 15, 2020as of January 15, 2020
(see Table 2).
Eligible Wool: Graded (clean basis) and ungraded (paid on a greasy basis). Graded (clean basis) and ungraded (paid on a greasy basis).
Dairy
Eligibility Criteria: Al Al
dairy operations with milkdairy operations with milk
production in January, February, and/or production in January, February, and/or
March 2020; as March 2020; as
well wel as any dumped milkas any dumped milk
production during the months of January, February, production during the months of January, February,
and March 2020. and March 2020.
Eligible Dairy: AlAl
milk milk produced during the first quarter of 2020. produced during the first quarter of 2020.
15 Ibid.
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Category
Eligibility Criteria and Eligible Commodities
Specialty
Eligibility Criteria: Producers of specialty crops are eligible for CFAP payments in any of the
Cropsc
Nursery Crops, Eligibility Criteria: Nursery crop and cut flower inventory that was shipped but Cut Flowers
subsequently spoiled or is unpaid due to loss of marketing channels between January 15, 2020, and April 15, 2020; and nursery crop and cut flower inventory that did not leave the farm between January 15, 2020, and April 15, 2020, due to a complete loss of marketing channel and that wil not be sold after April 15, 2020, due to lack of markets. Eligible Nursery Crops and Cut Flowers: ‘ Nursery crops’ means decorative or non-decorative plants grown in a container or control ed environment for commercial sale. ‘ Cut flowers’ include cut flowers and cut greenery from annual and perennial flowering plants grown in a container or control ed environment for commercial sale.
Aquaculture
Eligibility Criteria: Aquaculture species sold between January 15, 2020, through April 15,
(excluding
2020; and inventory of aquaculture species that was not sold but was market size and
crawfish)
available to be marketed between January 15, 2020, and April 15, 2020. Eligible Aquaculture: Catfish, largemouth bass and carp sold live as food, hybrid striped bass, red drum, salmon, sturgeon, tilapia, trout, ornamental or tropical fish, and recreational sportfish.
Crawfish
Eligibility Criteria: crawfish. Eligible Crawfish: Crawfish sold between January 15, 2020, through April 15, 2020; and inventory of crawfish that was not sold as of April 15, 2020, due to lack of a market and that wil not be sold in calendar year 2020.
Specialty
Eligibility Criteria: Producers of specialty crops are eligible for CFAP payments in any of
Cropsc
the fol owing three categories: fol owing three categories:
(1) Had crops that suffered at least a 5% price decline between January 15, 2020, and April(1) Had crops that suffered at least a 5% price decline between January 15, 2020, and April
15, 15,
202202
0;d
(2) Had produce that shipped by April 15, 2020, but subsequently spoiled due to loss(2) Had produce that shipped by April 15, 2020, but subsequently spoiled due to loss
of of
marketing channelmarketing channel
before payment was received;e and ;e and
(3) Had shipments that did not leave the farm by April(3) Had shipments that did not leave the farm by April
15, 2020 (for example,15, 2020 (for example,
were harvested were harvested
but are sitting in crates on the farm), or mature crops that remainedbut are sitting in crates on the farm), or mature crops that remained
unharvested by that unharvested by that
date (for example,date (for example,
were plowed under) due to lack of buyers, and which have not been and were plowed under) due to lack of buyers, and which have not been and
wil wil
not be sold.f
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link to page 21 USDA’s Coronavirus Food Assistance Program: Round One (CFAP-1)
Category
Eligibility Criteria and Eligible Commodities
Eligible Specialty Crops:
Fruit: apples, avocados, bananas, blackberries, blueberries, cantaloupe, carambola (star fruit), cherimoya, citron, coconuts, dates, dragon fruit (red pitaya), grapefruit, guava, kiwifruit, lemons, mamey sapote, nectarinesnot be soldf.
Eligible Specialty Crops:
Fruit: apples, avocados, blueberries, cantaloupe, grapefruit, kiwifruit, lemons, oranges, papaya, , oranges, papaya,
passion fruit, peaches, pears, persimmons, pineapples, pomegranates, pummelos, peaches, pears, raspberries,raspberries,
strawberries,strawberries,
tangelos, tangerines, tomatoes,tangerines, tomatoes,
and watermelons. watermelons.
Vegetables::
artichokes, asparagus, broccoli, cabbage, carrots, cauliflower, celery, artichokes, asparagus, batatas, beans, beets, bok choy, broccoli, brussels sprouts, cabbage, carrots, cauliflower, celery, sweet corn, 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.
Other
Certain other commodities (including those with insufficient information) wil be evaluated through a Notice of Funds Availability (NOFA) process.
Source: USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020. Notes: Non-specialty crops, livestock, and wool that meet the 5% price decline criteria are assumed to have met the marketing cost criteria.
a. According to USDA’s CFAPcucumbers, daikon, donqua (winter melon), eggplant, endive, escarole, frisee garlic, kale greens, col ard greens, dandelion greens, greens (others not listed separately), kohlrabi, kumquats, leeks, iceberg lettuce, boston lettuce, green leaf lettuce, lol a rossa lettuce, oak leaf green lettuce, oak leaf red lettuce, red leaf lettuce, romaine lettuce, mustard, okra, dry onions, green onions, parsnips, peas green, peppers, plantains, potatoes, pumpkins, radicchio, rhubarb, rutabagas, shal ots, sorrel, spinach, squash, sweet potatoes, swiss chard, taro, turnip tops green, turnips (celeriac), turmeric, upland and winter cress, watercress, yautia (malanga), and yuca (cassava). Nuts: almonds, filberts, pecans, pistachios, and walnuts. Other: alfalfa sprouts, aloe leaves, anise, arugula, basil, bean sprouts, celeriac (celery root), chervil (french parsley), chives, cilantro, curry leaves, dil , horseradish, maple sap (for maple syrup), marjoram, mesculin mix, microgreens, mint, mushrooms, oregano, parsley, rosemary, sage, savory, sugarcane (table), and thyme.
Source: USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020. Notes: Non-specialty crops, livestock, and wool that meet the 5% price decline criteria are assumed to have met the marketing cost criteria.
a. According to USDA’s CFAP-1 rule (85 rule (85
Federal Register 30825, May 21, 2020), non-specialty crops are those 30825, May 21, 2020), non-specialty crops are those
crops listed in this table, and any crops announced in a
crops listed in this table, and any crops announced in a
NOFANotice of Funds Availability (NOFA). The term excludes crops intended for . The term excludes crops intended for
grazing. grazing.
b. See the notes
b. See the notes
toto Table A-1 for a details on eligiblefor a details on eligible
animal species.animal species.
c. According to USDA’sc. According to USDA’s
CFAP CFAP-1 rule (85 rule (85
Federal Register 30825, May 21, 2020), specialty 30825, May 21, 2020), specialty
cropcrops are those are those
crops
crops listed in this tablelisted in this table
, and any crops for which funds are made available and announced in a NOFA. and any crops for which funds are made available and announced in a NOFA.
The term The term
excludes crops intended for grazing.excludes crops intended for grazing.
Additional specialty crops were added under two subsequent NOFAs: (85 Federal Register 41321, July 10, 2020) and (85 Federal Register 49589, August 14, 2020).
d. To verify a qualifying price decline for a specialty crop, producers must maintain records,
d. To verify a qualifying price decline for a specialty crop, producers must maintain records,
such as a bil of such as a bil of
sale,
sale,
documenting the price receiveddocumenting the price received
for the crop. for the crop.
e. To verify market
e. To verify market
spoilage, producers must obtain documentation such as a letter fromspoilage, producers must obtain documentation such as a letter from
the buyer explaining the buyer explaining
non-payment or other record
non-payment or other record
validating non-payment (this applies to producers who have met contractual validating non-payment (this applies to producers who have met contractual
obligations in deliveringobligations in delivering
the crop to the buyer, but have not been paid). the crop to the buyer, but have not been paid).
f.
f.
To verify unsold inventories,
To verify unsold inventories,
if requested, producers must provide supporting documentation, which AMS if requested, producers must provide supporting documentation, which AMS
wilwil
use to substantiate claims on a case-by-case basis. use to substantiate claims on a case-by-case basis.
Request for Additional Commodities
USDA
USDA
is to consider considered additional crops for eligibility for CFAP additional crops for eligibility for CFAP
-1 payments by collecting information payments by collecting information
on on
potentiallypotential y eligible eligible
crops.crops.
1620 Producers of commodities not included on the original CFAP Producers of commodities not included on the original CFAP
list -1 list, but who assert who assert
that they are eligiblethey are eligible
may, could submit information to USDA submit information to USDA
for consideration in for consideration in
decisions decisions
about including additional commodities. Approximately $637 about including additional commodities. Approximately $637
million mil ion or about 4% of the CFAPor about 4% of the CFAP
-1’s ’s
$16 billion $16 bil ion in funding is availablein funding is available
to provide assistance to producers of other commodities that to provide assistance to producers of other commodities that
are identified through the Notice of Funds Availabilityare identified through the Notice of Funds Availability
(NOFA) process.(NOFA) process.
17 USDA has21 USDA had stated that it was particularly interested in obtaining information about nursery 20 stated that it
16 For more details, see the information posted at USDA’s CFAP web For more details, see the information posted at USDA’s CFAP web
portal at https://www.farmers.gov/cfap, including portal at https://www.farmers.gov/cfap, including
a USDAa USDA
Fact Sheet, “Consideration of Additional Commodities,” availableFact Sheet, “Consideration of Additional Commodities,” available
under “Resources.”under “Resources.”
17 21 USDA, USDA,
“Coronavirus Food Assistance Program: Cost Benefit Analysis,” May 14, 2020.“Coronavirus Food Assistance Program: Cost Benefit Analysis,” May 14, 2020.
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USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments
is particularly interested in obtaining information about nursery products, aquaculture products, and cut flowers.: Round One (CFAP-1)
products, aquaculture products, and cut flowers. In particular, USDA reconsidered commodities that were excluded under the initial CFAP-1 announcement if credible evidence was presented that supported a 5% price decline or COVID-related marketing costs. Ultimately, 92 additional specialty crops, 3 non-specialty commodities, and 11 aquaculture species were added to CFAP-1
payment eligibility.22
Ineligible Commodities
Non-specialty crops and livestock that did not suffer a price decline of at least 5% from mid-
Non-specialty crops and livestock that did not suffer a price decline of at least 5% from mid-
January 2020 to mid-April 2020 are not eligibleJanuary 2020 to mid-April 2020 are not eligible
for CFAP. Specifically, this includes sheep more than two years old, eggs/ for CFAP-1. Specifical y, this includes certain eggs and layers, soft red winter wheat, hard red winter wheat, white wheat, rice, 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 flax, rye, peanuts, feed barley, Extra Long Staple (ELS) cotton, alfalfa, forage crops, hemp, and
tobacco.18 USDA may reconsider the excluded commodities if credible evidence supports a 5% price decline or COVID-related marketing costs. Any croptobacco.23 Any livestock breeding animals or crops that were intended for grazing intended for grazing
iswere excluded from excluded from
eligibility
eligibility for CFAP.for CFAP.
Eligible Producers
According to USDA rules, to qualify for a CFAP
According to USDA rules, to qualify for a CFAP
-1 payment, an eligible payment, an eligible
individual individual or legal entity or legal entity
must meet the following criteria: must meet the following criteria:
Each producer or legal entity of qualifying commodities must complete a CFAP
Each producer or legal entity of qualifying commodities must complete a CFAP
-
1 application form and provide any required documentation (as specified below).application form and provide any required documentation (as specified below).
1924
A producer must share in the risk of producing a qualifying crop or livestock
A producer must share in the risk of producing a qualifying crop or livestock
, and and
isbe entitled to share in the crop or livestock available for marketing between entitled to share in the crop or livestock available for marketing between
January 15, 2020, and April 15, 2020, or April 16, 2020, through May 14, 2020. January 15, 2020, and April 15, 2020, or April 16, 2020, through May 14, 2020.
A contract grower who does not own the livestock is to be considered a producer A contract grower who does not own the livestock is to be considered a producer
if the contract if the contract
allowsal ows the grower to have risk in the livestock. the grower to have risk in the livestock.
The producer must be in compliance with conservation provisions—including
The producer must be in compliance with conservation provisions—including
highly erodible land conservation (Sodbuster) and wetland conservation
highly erodible land conservation (Sodbuster) and wetland conservation
(Swampbuster) provisions.(Swampbuster) provisions.
2025
A producer must be either a U.S. citizen or a resident alien; however, a foreign
A producer must be either a U.S. citizen or a resident alien; however, a foreign
person may qualify if they provide sufficient land, capital, and active personal
person may qualify if they provide sufficient land, capital, and active personal
labor to the farming operation. USDA has established that 400 hours of active labor to the farming operation. USDA has established that 400 hours of active
personal labor or active personal management meets this standard. personal labor or active personal management meets this standard.
There is no requirement to have crop insurance coverage or coverage under the
There is no requirement to have crop insurance coverage or coverage under the
Noninsured Crop Disaster Assistance Program.
Noninsured Crop Disaster Assistance Program.
A person or legal entity, other than a joint venture or general partnership,
A person or legal entity, other than a joint venture or general partnership,
2126 is is
ineligible
ineligible
for payments if the person’s or legal entity’s average adjusted gross for payments if the person’s or legal entity’s average adjusted gross
income (AGI), using the average of the AGIs for the 2016, 2017, and 2018 tax income (AGI), using the average of the AGIs for the 2016, 2017, and 2018 tax
years, is more than $900,000, unless at least 75% of that person’s or legal entity’s average AGI is derived from farming, ranching, or forestry-related activities.
A producer must not have a controlled substance violation.
18 For more information, see additional USDA CFAP program information at https://www.farmers.gov/cfap. 19 USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020. 20 See CRS Report R42459, Conservation Compliance and U.S. Farm Policy. 21 With respect to joint ventures and general partnerships, this AGI provision will be applied to each member of the joint venture and general partnership.
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CFAP Direct Payment Calculations
A producer’s total CFAP payment is determined by first, multiplying the relevant quantity of each affected commodity by its respective payment rate. The payments from the two rates are then combined into a single payment per eligible commodity for each eligible producer (Table 2). Second, the total CFAP payment is obtained by summing payments across all of a producer’s commodities. These calculations require both payment rates and applicable quantities as described in the box “Deriving the CFAP Payment Rates (PRs) and Payment Quantities.”
Table 2. CFAP Payment Formula by Commodity Category
Quantity Measure
Factor
Payment Rate (PR)0
Non-Specialty Crops—payment equals sum of:
1
Unpriced inventoryb as of 1/15/20
x
50%
x Cares Act PR (Table A-1)
2
Unpriced inventory as of 1/15/20
x
50%
x CCC PR (Table A-1)
Specialty Crops—payment equals sum of:
Cares Act PR-1 (Error! Not a
22 Additional commodities were added under two subsequent NOFAs: 85 Federal Register 41321, July 10, 2020; and 85 Federal Register 49589, August 14, 2020. 23 For more information, see additional USDA CFAP program information at https://www.farmers.gov/cfap. 24 USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020. 25 See CRS Report R42459, Conservation Compliance and U.S. Farm Policy. 26 With respect to joint ventures and general partnerships, this AGI provision will be applied to each member of the joint venture and general partnership.
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years, is more than $900,000, unless at least 75% of that person’s or legal entity’s average AGI is derived from farming, ranching, or forestry-related activities.
A producer must not have a controlled substance violation.
CFAP-1 Direct Payment Calculations A producer’s total CFAP-1 payment is determined by first, multiplying the relevant quantity of
each affected commodity by its respective payment rate. The payments from two rates—one from the CARES Act and the other from CCC—are then combined into a single payment per eligible commodity for each eligible producer (Table 2). Second, the total CFAP-1 payment is obtained by summing payments across al of a producer’s commodities.27 These calculations require both payment rates and applicable quantities as described in the box “Deriving the CFAP-1 Payment
Rates (PRs) and Payment Quantities.” Under this structure, CFAP payments are directly
proportional, or “coupled,” to actual production.28
Deriving the CFAP-1 Payment Rates (PRs) and Payment Quantities
The CFAP payment for each commodity is based on separate payment rates for each of the two funding sources—CARES Act and CCC. The different payment rates for each commodity and their underlying derivation are described in Table A-1 and Table A-2. CARES Act PR: Based on the Price Decline Between Mid-January to Mid-April The CARES Act PR reflects the income loss associated with the price decline for each commodity between mid -January and mid-April. USDA estimates the price-loss PR for each commodity as a portion of the price decline between the week of January 13-17, 2020, and the week of April 6-9, 2020, using futures contract prices or AMS-reported cash prices, depending on availability. CCC PR: Based on Unexpected Marketing Costs The market-cost PR (CCC PR) for each commodity is based on USDA’s projection of costs likely to be incurred for marketing the surplus inventory due to disrupted markets. Payment Quantities Are Approximated by Inventories or 1st Quarter Sales To approximate losses, the CARES Act and CCC PRs are multiplied by an applicable measure of the affected quantity of an eligible commodity (depending on the commodity as shown in Table 2). For non-specialty crops and wool: the payment quantity for both CARES Act PR and CCC PR is approximated by using the lower of either: (1) the unsold quantity of unpriced inventory29 as of January 15, 2020, for which the producer has vested ownership, or (2) 50% of the producer’s 2019 total production of the commodity. For livestock (including cattle, hogs and pigs, and lambs and yearlings): the payment quantity for the CARES Act PR is approximated by the number of animals sold during the period of January 15, 2020, to April 15, 2020; and the payment quantity for the CCC PR is approximated by the maximum unpriced inventory of animals during the period from April 16, 2020, to May 14, 2020. Specialty crops may be eligible for any of three types of PRs (Table A-2):30 CARES Act PR-1 reflects the mid-January to mid-April price decline and is applied to the producer-certified sales (in pounds) during the period of
27 Examples of how the payment formulas may be applied to certain commodities are available in Nick Paulson et al., “Coronavirus Food Assistance Program (CFAP) Rules Announced,” Dept. of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, farm doc daily, vol. 10, no. 95 (May 22, 2020); and Shelby Myers, “Reviewing the CFAP Payment Formula for Non-Specialty Crops,” Market Intel, American Farm Bureau Federation, May 28, 2020. 28 T he nature of the linkage—coupled versus non-coupled—between program payments and producer production choices is relevant to how such payments may count against U.S. domestic support co mmitments at the World T rade Organization (WT O); see CRS Report R45305, Agriculture in the WTO: Rules and Lim its on U.S. Dom estic Support.
29 Unpriced means any production or inventory that is not subject to an agreed-upon price in the future through a forward contract, agreement, or similar binding document. 30 If a specialty crop’s price did not decline by at least 5% during this period, it is not eligible for CARES Act PR-1 but
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January 15, 2020, to April 15, 2020; and CARES Act PR-2 is applied to producer-certified product that has been shipped from the farm by April 15, 2020, but that spoiled due to COVID-related market disruptions prior to receiving payment.31 CCC PR-3 reflects COVID-related marketing costs and is applied to unsold inventory—estimated by the producer-certified maximum unpriced inventory from April 16, 2020, to May 14, 2020. For dairy: the payment quantity for the CARES Act PR is approximated by using the quantity of milk sold during the 1st quarter of 2020; and the payment quantity for the CCC PR is theoretical y applied to the quantity of milk sold during the 2nd quarter—which is approximated by applying a growth rate of 1.4% to 1st quarter sales.
Table 2. CFAP-1 Payment Formula by Commodity Category
Quantity Measure
Factor
Payment Rate (PR)a
Non-Specialty Crops—payment equals sum of:
1
Unpriced inventoryb as of 1/15/20
x
50%
x Cares Act PR (Table A-1)
2
Unpriced inventory as of 1/15/20
x
50%
x CCC PR (Table A-1)
Specialty Crops—payment equals sum of:
1
Quantity sold during 1/15/20 to 4/15/20
x
100%
x Cares Act PR-1 (Table A-2) 1
Quantity sold during 1/15/20 to 4/15/20
x
100%
x valid result for table.)
Cares Act PR-2 (Error! Not a
2
2
Quantity shipped, but
Quantity shipped, but
spoiledspoiled:c 1/15/20 to 4/15/20 1/15/20 to 4/15/20
x
x
100%
100%
x
x
valid result for table.)
CCC PR-3 (Error! Not a vCares Act PR-2 (Table A-2)
3
3
Unpriced quantity on far
Unpriced quantity on far
m:d 11/15/20 to 4/15/20 /15/20 to 4/15/20
x
x
100%
100%
x
x
alid result for table.)
Cattle—payment CCC PR-3 (Table A-2)
Nursery and Cut Flowerse—payment equals sum of:
1
Wholesale value of quantity shipped, but spoiled or unpaid: 1/15/20 to 4/15/20
x
15.55%f
2
Wholesale value of inventory on farm due to loss of market: 1/15/20 to 4/15/20g x
13.45%
Cattle—payment equals sum of:
1
1
Unpriced head sold during 1/15/20 to 4/15/20
Unpriced head sold during 1/15/20 to 4/15/20
x
x
100%
100%
x Cares Act PR
x Cares Act PR
(Table A-1)
2
2
Unpriced inventory, max during 4/16/20 to 5/14/2
Unpriced inventory, max during 4/16/20 to 5/14/2
0e0h
x
x
100%
100%
x CCC PR
x CCC PR
(Table A-1)
Hogs and Pigs—payment equals equals sum of:
1
1
Unpriced head sold during 1/15/20 to 4/15/20
Unpriced head sold during 1/15/20 to 4/15/20
x
x
100%
100%
x Cares Act PR
x Cares Act PR
(Table A-1)
2
2
Unpriced inventory, max during 4/16/20 to 5/14/20
Unpriced inventory, max during 4/16/20 to 5/14/20
x
x
100%
100%
x CCC PR
x CCC PR
(Table A-1)
Dairy—payment equals sum of:
1st quarter milk production during 1/15/20 to
1
4/15/20Error! Reference source not found.1
1st quarter (January-March) milk production in 2020i
x 100.0%
x 100.0%
x Cares Act PR
x Cares Act PR
(Table A-1)
2
2
1st quarter
1st quarter
milk production during 1/15/20 to 4/15/20g(January-March) milk production in 2020j
x 101.4%
x 101.4%
x CCC PR
x CCC PR
(Table A-1)
Lambs and YearlingsSheep—payment equals equals sum of:
1
1
Unpriced head sold during 1/15/20 to 4/15/20
Unpriced head sold during 1/15/20 to 4/15/20
x
x
100%
100%
x Cares Act PR
x Cares Act PR
(Table A-1)
2
2
Unpriced inventory, max during 4/16/20 to 5/14/20
Unpriced inventory, max during 4/16/20 to 5/14/20
x
x
100%
100%
x CCC PR
x CCC PR
(Table A-1)
Wool—payment equals sum of:
1
1
Unpriced inventory as of 1/15/20
Unpriced inventory as of 1/15/20
x
x
50%
50%
x Cares Act PR
x Cares Act PR
(Table A-1)
2
2
Unpriced inventory as of 1/15/20
Unpriced inventory as of 1/15/20
x
x
50%
50%
x CCC PR
x CCC PR
(Table A-1)
Source: USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020. Notes: Farmers and ranchers wil self-certify their claims regarding inventories, sales, and shipments. Unpriced means any production or inventory that is not subject to an agreed-upon price in the future through a forward contract, agreement, or similar binding document.
Payment rates (PR) for each commodity are listed in Table A-1 and
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a. Table A-2 at the end of this report. b. The quantity harvested, but as-yet-unpriced inventory, for which the producer has vested ownership. The
inventory quantity may not exceed 50% of the producer’s 2019 total production of the commodity.
c. Quantity of the harvested crop that was shipped but was unpaid or spoiled prior to receiving a payment due
to a disruption of the marketing channel.
d. Quantity of the harvested crop that did not leave the farm (was unsold) or was donated and the quantity of
mature crops that remained unharvested.
e. The highest inventory number between April 16 and May 14, 2020. f.
Dairy operations that dissolved on or before March 31, 2020, are eligible for the CARES Act payment rate.
g. Second quarter milk production is approximated by applying an adjustment factor of 1.014 to the 1st quarter
production. Dairy operations that dissolved after March 31, 2020, are eligible for a prorated payment for the number of days that the operation commercial y marketed milk in the second quarter.
Deriving the CFAP Payment Rates (PRs) and Payment Quantities
The CFAP payment for each commodity is based on separate payment rates for each of the two funding sources—CARES Act and CCC. The different payment rates for each commodity and their underlying derivation are described in Table A-1 and Error! Not a valid result for table.. CARES Act PR: Based on the Price Decline Between Mid-January to Mid-April The CARES Act PR reflects the income loss associated with the price decline for each commodity between mid-January and mid-April. USDA estimates the price-loss payment rate for each commodity as a portion of the price decline between the week of January 13-17, 2020, and the week of April 6-9, 2020, using futures contract prices or AMS-reported cash prices depending on availability. CCC PR: Based on Unexpected Marketing Costs The market-cost PR (CCC PR) for each commodity is based on USDA’s projection of costs likely to be incurred for marketing the surplus inventory due to disrupted markets. Payment Quantities Are Approximated by Inventories or 1st Quarter Sales
To approximate losses, the CARES Act and CCC PRs are multiplied by an applicable measure of the affected quantity of an eligible commodity (depending on the commodity as shown in Table 2). For non-specialty crops and wool, the payment quantity for both CARES Act PR and CCC PR is approximated by using the lower of either: (1) the unsold quantity of unpriced inventory22 as of January 15, 2020, for which the producer has vested ownership, or (2) 50% of the producer’s 2019 total production of the commodity. For livestock (including cattle, hogs and pigs, and lambs and yearlings),
the payment quantity for the CARES Act PR is approximated by the number of animals sold during the period of January 15, 2020, to April 15, 2020; and
the payment quantity for the CCC PR is approximated by the maximum unpriced inventory of animals during the period from April 16, 2020, to May 14, 2020.
Specialty crops may be eligible for any of three types of PRs (Error! Not a valid result for table.):23
CARES Act PR-1 reflects the mid-January to mid-April price decline, and is applied to the producer-certified sales (in pounds) during the period of January 15, 2020, to April 15, 2020; and
22 Unpriced means any production or inventory that is not subject to an agreed-upon price in the future through a forward contract, agreement, or similar binding document.
23 If a specialty crop’s price did not decline by at least 5% during this period, it is not eligible for CARES Act PR-1, but may be eligible for CARES Act PR-2 or CCC PR-3. See
Table A-2 for examples of commodities that did not experience a sufficiently large price decline, but were still eligible for spoilage loss or marketing loss payments.
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CARES Act PR-2 is applied to producer-certified product that has been shipped from the farm by April 15, 2020, but that spoiled due to COVID-related market disruptions prior to receiving payment.24
CCC PR-3 reflects COVID-related marketing costs and is applied to unsold inventory—estimated by the producer-certified maximum unpriced inventory from April 16, 2020, to May 14, 2020.
For dairy:
the payment quantity for the CARES Act PR is approximated by using the quantity of milk sold during the 1st quarter of 2020; and
the payment quantity for the CCC PR is theoretically applied to the quantity of milk sold during the 2nd quarter—which is approximated by applying a growth rate of 1.014% to 1st quarter sales.
Examples of how this payment formula may be applied to certain commodities are available in the footnoted references.25 Under this structure, CFAP payments are directly proportional, or “coupled,” to actual production.26
Projected CFAP Direct Payment Outlays
USDA estimates that, once adjustments have been made to account for payment limits, the $16 billion in CFAP funding is to be allocatedLiquid and Frozen Eggs—payment equals sum of:
1
1st quarter (January-March) production in 2020
x
100%
x Cares Act PR (Table A-3)
2
1st quarter (January-March) production in 2020
x
100%
x CCC PR (Table A-3)
may be eligible for CARES Act PR-2 or CCC PR-3. See Table A-2 for examples of commodities that did not experience a sufficient ly large price decline but were still eligible for spoilage loss or marketing loss payments. 31 T he two different types of CARES Act payments are labeled “CARES Act PR-1” for price losses and “CARES Act PR-2” for spoilage losses in Table A-2.
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Quantity Measure
Factor
Payment Rate (PR)a
Aquaculturek—payment equals sum of:
1
Quantity sold during 1/15/20 to 4/15/20
x
100%
x Cares Act PR (Table A-3)
3
Unsold, market-ready inventory: 1/15/20 to 4/15/20
x
100%
x CCC PR (Table A-3)
Source: USDA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020; and USDA, “NOFA CFAP, Additional Eligible Commodities,” 85 Federal Register 49589, August 14, 2020. Notes: Farmers and ranchers wil self-certify their claims regarding inventories, sales, and shipments. Unpriced means any production or inventory that is not subject to an agreed-upon price in the future through a forward contract, agreement, or similar binding document.
a. Payment rates (PR) for each commodity are listed in Table A-1, Table A-2, and Table A-3 at the end of
this report.
b. The quantity harvested, but as-yet-unpriced inventory (i.e., inventory not under a sales contract), for which
the producer has vested ownership. The inventory quantity may not exceed 50% of the producer’s 2019 total production of the commodity.
c. Quantity of the harvested crop that was shipped but was unpaid or spoiled prior to receiving a payment due
to a disruption of the marketing channel.
d. Quantity of the harvested crop that did not leave the farm (was unsold or was not under a sales contract)
or was donated and the quantity of mature crops that remained unharvested.
e. ‘ Nursery crops’ means decorative or non-decorative plants grown in a container or control ed
environment for commercial sale. ‘ Cut flowers’ includes cut flowers and cut greenery from annual and perennial flowering plants grown in a container or control ed environment for commercial sale.
f.
The payment rates for nursery crops and cut flowers were determined using coverage rates that represent half of input costs multiplied by the industry-reported 40.5% average revenue loss. This approach accounts for the higher percentage of input costs incurred prior to ‘ harvest’ of the inventory compared with traditional agricultural crops.
g. Inventory that may be sold after April 15, 2020, is not eligible for CFAP. h. The highest inventory number between April 16, 2020, and May 14, 2020. i.
Dairy operations that dissolved on or before March 31, 2020, are eligible for the CARES Act payment rate.
j.
Second quarter milk production is approximated by applying an adjustment factor of 1.014 to the 1 st quarter production. Dairy operations that dissolved after March 31, 2020, are eligible for a prorated payment for the number of days that the operation commercial y marketed milk in the second quarter.
k. Aquaculture payments are calculated separately for two categories: crawfish and al other aquaculture
excluding crawfish.
Projected CFAP-1 Direct Payment Outlays USDA estimated that, once adjustments have been made to account for payment limits, the $16 bil ion in CFAP-1 funding is to be al ocated across four different commodity groupings as
across four different commodity groupings as follows: follows:
livestock ($9.4 livestock ($9.4
billionbil ion or 58.9%); row crops ($3.5 or 58.9%); row crops ($3.5
billionbil ion, 21.9%); specialty crops ($2.4 , 21.9%); specialty crops ($2.4
billion, bil ion, 15.0%); and “other” commodities ($670 15.0%); and “other” commodities ($670
millionmil ion, 4.2%), 4.2%)
(Figure 1).27 Direct32 USDA’s estimates for direct payment spending payment spending
under the livestock category can be further delineated as $5.1 under the livestock category can be further delineated as $5.1
billion bil ion for cattle, $2.8 for cattle, $2.8
billionbil ion for for
dairy, and $1.6 billion for hogs.
24 The two different types of CARES Act payments are labeled “CARES Act PR-1” for price losses, and “CARES Act PR-2” for spoilage losses in
Table A-2. 25 Paulson, N., G. Schnitkey, J. Coppess, C. Zulauf, and K. Swanson, “Coronavirus Food Assistance Program (CFAP) Rules Announced,” farmdoc daily (10): 95, Dept. of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, May 22, 2020; see also Shelby Myers, “Reviewing the CFAP Payment Formula for Non-Specialty Crops,” Market Intel, American Farm Bureau Federation, May 28, 2020. 26 The nature of the linkage—coupled versus non-coupled—between program payments and producer production choices is relevant to how such payments may count against U.S. domestic support commitments at the World Trade Organization (WTO); for details, see CRS Report R45305, Agriculture in the WTO: Rules and Limits on U.S. Domestic
Support.
27 USDA, dairy, and $1.6 bil ion for hogs. However, as of November 1, 2020, USDA reports that actual outlays under CFAP-1 are at $10.345 bil ion—substantial y below the
expected $16 bil ion in available funding.33 Some possible reasons for this discrepancy are
32 USDA, “Coronavirus Food Assistance Program: Cost Benefit Analysis,” T able 11. Estimated Net CFAP Payments by Commodity Group, after payment limitations, May 14, 2020. 33 USDA, Coronavirus Food Assistance Program 1 Data, as of November 1, 2020, at https://www.farmers.gov/cfap1/data.
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addressed later in the “Issues for Congress” section of the report. CFAP-1 payments are
concentrated in the Corn Belt, Texas, and California (Figure 2).
Figure 1. CFAP-1 Payments by Commodity
Available Funds and Actual Outlays
Sources: USDA projected outlays based on available funding are from USDA, “Coronavirus Food Assistance Program:“Coronavirus Food Assistance Program:
Cost Benefit Analysis,”Cost Benefit Analysis,”
Table 11. Estimated Net CFAP Payments Table 11. Estimated Net CFAP Payments
by Commodityby Commodity
Group, after payment limitations,Group, after payment limitations,
May 14, 2020.
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Figure 1. Projected CFAP Net Payments by Commodity After Payment Limitations
Source: USDA, “Coronavirus Food Assistance Program: Cost Benefit Analysis,” Table 11. Estimated Net CFAP Payments by Commodity Group, after payment limitations, May 14, 2020, p. 20. Note: *Other includes commodities that may be identified through the NOFA process.
CFAP Application Process
USDA accepted CFAP applications starting on May 26, 2020. Producers should apply through their local FSA Service Center; however, an application may be submitted to any FSA county office.28 To be eligible, an application must be submitted by the close of business on August 28, 2020. Payments to an eligible producer are expected to be made soon after each application is processed, according to USDA.
In addition to the application form, several other standard USDA forms must be on file for all persons and entities requesting CFAP benefits (Table A-3 May 14, 2020, p. 20; actual outlays as of November 15, 2020, are from USDA, Coronavirus Food Assistance Program 1 Data, at https://www.farmers.gov/cfap1/data. Note: *Other includes al commodities not associated with the listed categories, including aquaculture, specialty livestock, and others.
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Figure 2. CFAP-1 Payments by State
State Abbreviation: $ mil ions
Source: USDA, Coronavirus Food Assistance Program, CFAP-1 payment data, as of November 15, 2020, at https://www.farmers.gov/cfap1. Note: Total CFAP-1 outlays were $10.421 mil ion as of November 15, 2020.
CFAP-1 Application Process USDA accepted CFAP-1 applications starting on May 26, 2020. Producers applied through their
local FSA Service Centers; however, an application could be submitted to any FSA county office.34 To be eligible, an application had to have been submitted by the close of business on September 11, 2020. Payments to eligible producers were expected to be made soon after each
application was processed, according to USDA.
In addition to the application form, several other standard USDA forms must be on file for al persons and entities requesting CFAP-1 benefits (Table A-5). However, for producers that are . However, for producers that are
existing FSA program participants, most of these supplementary forms are likely already on file existing FSA program participants, most of these supplementary forms are likely already on file
at their local FSA Service at their local FSA Service
CenterCenters. In addition to these forms, if requested by USDA, an applicant . In addition to these forms, if requested by USDA, an applicant
must provide documentation that verifies the quantities of production and/or inventory used in the must provide documentation that verifies the quantities of production and/or inventory used in the
application, and that establishes the applicant’s ownership share and value at risk for the application, and that establishes the applicant’s ownership share and value at risk for the
commodity.
Producer Data Subject to Verification
Producers are expected to self-certify their sales and inventories that are used to calculate CFAP payments.29 Producers who are approved for participation in CFAP are required to retain 28 CFAP
commodity.
34 CFAP-1 application forms, as well application forms, as well
as a “CFAP Payment Calculator” to assist producers with the application process, as a “CFAP Payment Calculator” to assist producers with the application process,
are available from USDAare available from USDA
at https://www.farmers.gov/cfap.
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Producer Data Subject to Verification Producers are expected to self-certify their sales and inventories that are used to calculate CFAP-1
payments.35 Producers who are approved for participation in CFAP-1 are required to retain documentation in support of their applicationsat https://www.farmers.gov/cfap.
29 USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020.
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documentation in support of their application for three years after the date of approval. This for three years after the date of approval. This
includes records and paperwork to demonstrate losses, includes records and paperwork to demonstrate losses,
especiallyespecial y producers who have destroyed producers who have destroyed
their product (e.g., dumping of milk or plowing under specialty crops). their product (e.g., dumping of milk or plowing under specialty crops).
Participants receiving CFAP
Participants receiving CFAP
-1 payments or any other person who furnishes such information to payments or any other person who furnishes such information to
USDA must permit authorized representatives of USDA or the Government Accountability Office USDA must permit authorized representatives of USDA or the Government Accountability Office
(GAO), during regular business hours, to enter the agricultural operation and to inspect, examine, (GAO), during regular business hours, to enter the agricultural operation and to inspect, examine,
and make copies of books, records, or other items for the purpose of confirming the accuracy of and make copies of books, records, or other items for the purpose of confirming the accuracy of
the information provided by the participant. the information provided by the participant.
Initial Payment Tranche of 80%
USDA is to pay out an initial tranche ofInitial y, USDA paid out 80% of an eligible 80% of an eligible
participant’s total potentialparticipant’s total potential
CFAP CFAP-1 payments. By issuing initialpayments. By issuing initial
payments, FSA’s goal payments, FSA’s goal
iswas to provide assistance to those eligible to provide assistance to those eligible
participants who immediately participants who immediately
applyapplied for assistance, while trying to ensure that CFAP for assistance, while trying to ensure that CFAP
-1 payments payments
do did not exceed the $16 not exceed the $16
billion funding limit. If funds remain available after the initial payment to all eligible applicants, USDA is to disburse the remainder of available bil ion funding limit. USDA would then disburse any remaining available funding such that the initialfunding such that the initial
and final payments and final payments
dowould not exceed a total of $9.5 not exceed a total of $9.5
billionbil ion for CARES Act funds for CARES Act funds
and $6.5 and $6.5
billion bil ion for for
CCC funds. Funds CCC funds. Funds
maycould be prorated if necessary to stay within these limits. be prorated if necessary to stay within these limits.
However, based on actual outlays it does not appear that USDA approached any CFAP-1 funding
shortfal (Figure 1).
Payment Limits CFAP-1
Payment Limits
CFAP payments are, in general, subject to a per-person and per-legal-entity payment limitation of payments are, in general, subject to a per-person and per-legal-entity payment limitation of
$250,000,$250,000,
3036 which is expected to result in some eligible which is expected to result in some eligible
commodity producers not receiving the commodity producers not receiving the
entire calculated CFAPentire calculated CFAP
-1 payment. For example, USDA projects that, based on its CFAP payment. For example, USDA projects that, based on its CFAP
-1
payment payment
formula without payment limits, over $19 formula without payment limits, over $19
billion bil ion in CFAPin CFAP
-1 payments would be made. payments would be made.
31 37 However, However,
after applying the CFAP payment limitafter applying the CFAP payment limit
criteria, USDA projects that a net of $16 criteria, USDA projects that a net of $16
billion in CFAP payments will bil ion
in CFAP-1 payments wil be made. be made.
The CFAP
The CFAP
-1 payment limitation payment limitation
applies to the total amount of CFAPapplies to the total amount of CFAP
-1 payments made with respect to payments made with respect to
all eligibleall eligible
commodities of an individualcommodities of an individual
or entity. However, unlike payment limits for other FSA or entity. However, unlike payment limits for other FSA
programs where corporate entities are limited to a single payment limit,programs where corporate entities are limited to a single payment limit,
3238 USDA has elected to USDA has elected to
apply special payment limitationapply special payment limitation
rules to CFAPrules to CFAP
-1 participants that are corporations, limited liability participants that are corporations, limited liability
companies, and limited partnerships. Under the special payment limitation rules, companies, and limited partnerships. Under the special payment limitation rules,
these corporate these corporate
entities may receive CFAPentities may receive CFAP
-1 payments up to $750,000 if three or more different payments up to $750,000 if three or more different
individual individual owners owners
or shareholders of the legal entity each contributed at least 400 hours of active personal labor or or shareholders of the legal entity each contributed at least 400 hours of active personal labor or
active personal management (or combination thereof) with respect to the active personal management (or combination thereof) with respect to the
production of 2019 production of 2019
commodities.33
Under normal USDA rules governing recordkeeping requirements in regards to meeting the “actively engaged in farming” criteria, all persons that provide any management to the farming operation and seek to qualify as a farm manager—eligible for payments up to the individual payment limit—are required to maintain contemporaneous records or activity logs of their management activities.34
30 Thiscommodities.39
35 USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020. 36 T his compares with a payment limit of $125,000 per individual under traditional farm programs from compares with a payment limit of $125,000 per individual under traditional farm programs from
TitleT itle I of the I of the
2018 farm bill (P.L. 115-334). See CRS2018 farm bill (P.L. 115-334). See CRS
Report R46248, Report R46248,
U.S. Farm Programs Program s: Eligibility and Payment Limits.
31 USDA, Paym ent Lim its. 37 USDA, “Coronavirus Food Assistance Program: Cost Benefit Analysis,” May 14, 2020, p. 8.“Coronavirus Food Assistance Program: Cost Benefit Analysis,” May 14, 2020, p. 8.
32 CRS 38 CRS Report R46248, Report R46248,
U.S. Farm Programs: Eligibility and Payment Limits. .
3339 USDA, USDA,
FSA,FSA,
“Coronavirus Food Assistance Program,” Final Rule,“Coronavirus Food Assistance Program,” Final Rule,
85 85
Federal Register 30825, May 21, 2020.
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Under normal USDA rules governing recordkeeping requirements in regard to meeting the “actively engaged in farming” criteria, al persons that provide any management to the farming operation and seek to qualify as a farm manager—eligible for payments up to the individual payment limit—are required to maintain contemporaneous records or activity logs of their
management activities.40 30825, May 21, 2020. 34 See CRS Report R44656, USDA’s Actively Engaged in Farming (AEF) Requirement.
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For a corporate entity, For a corporate entity,
in general, the payment limit for the entity is $250,000;
in general, the payment limit for the entity is $250,000;
the payment limit for the entity is $500,000 if two different individual owners or the payment limit for the entity is $500,000 if two different individual owners or
shareholders of the legal entity each contributed at least 400 hours of active
shareholders of the legal entity each contributed at least 400 hours of active
personal labor or active personal management (or combination thereof) with personal labor or active personal management (or combination thereof) with
respect to the production of 2019 commodities; and respect to the production of 2019 commodities; and
the limit
the limit
is $750,000 if three or more different individual owners or shareholders is $750,000 if three or more different individual owners or shareholders
of the legal entity each contributed at least 400 hours of active personal labor or
of the legal entity each contributed at least 400 hours of active personal labor or
active personal management (or combination thereof) with respect to the active personal management (or combination thereof) with respect to the
production of 2019 commodities. production of 2019 commodities.
Neither the CARES Act nor the underlying CCC authority requires payment limits. Applying
Neither the CARES Act nor the underlying CCC authority requires payment limits. Applying
payment limits was done at USDA’s discretion, as it also chose to do when establishing the payment limits was done at USDA’s discretion, as it also chose to do when establishing the
Market Facilitation Payment Market Facilitation Payment
andProgram and the Wildfire and Hurricane Indemnity Program Wildfire and Hurricane Indemnity Program
programs that were that were
undertaken at the Secretary’s discretion.undertaken at the Secretary’s discretion.
3541 Benefits received under traditional farm support Benefits received under traditional farm support
programs such as the Acreage Risk Coverage and Price Loss Coverage programs are not to be programs such as the Acreage Risk Coverage and Price Loss Coverage programs are not to be
added to CFAPadded to CFAP
-1 payments when evaluating payment limits. payments when evaluating payment limits.
3642 In other words, payment limits for In other words, payment limits for
CFAP
CFAP-1 are independent of other farm program benefits received by a farm. are independent of other farm program benefits received by a farm.
Issues for Congress
Four issues may be of potential interest to Congress:
1. An immediate congressional concern could involve monitoring the
implementation of the CFAP to ensure that program funding is fairly allocated across all affected agricultural sectors and all Now that the program application period has closed (September 11, 2020) and a substantial portion of program outlays ($10.3 bil ion as of November 1, 2020) have been made, the CFAP-1 program’s perceived strengths and weaknesses are becoming more discernible. Many Members of
Congress, as wel as program stakeholders, have raised several concerns regarding the CFAP-1.
First, an immediate congressional concern some raised involved the implementation of the CFAP-1 to ensure that program funding was al ocated to incentivize participation by al affected agricultural sectors and al injured producers within those injured producers within those
sectors, to the maximum extent sectors, to the maximum extent
possible. Based on USDA payment data through November 1, 2020, a third of the CFAP-1 outlays projected for specialty crop producers have occurred (Figure 1). Preliminary assessments suggest that this is in large part due to the payment methodology and price data that USDA used to determine CFAP-1 eligibility and payment rates—in particular, USDA opting to use national price data to determine eligibility and as a basis for determining the payment for lost sales. Many
smal -scale specialty crop producers sel directly to restaurants or local food markets—a national average price often fails to reflect the price premiums that such direct marketing captures.43
40 See CRS Report R44656, USDA’s Actively Engaged in Farming (AEF) Requirement. 41 See CRS Report R45310, Farm Policy: USDA’s 2018 Trade Aid Package, CRS Report R45865, Farm Policy: USDA’s 2019 Trade Aid Package; and CRS In Focus IF11539, Wildfires and Hurricanes Indemnity Program (WHIP). 42 USDA, “Coronavirus Food Assistance Program: Cost Benefit Analysis,” May 14, 2020, p. 8. 43 T he predicament related to USDA’s decision to use national prices for specialty crops was highlighted by House Agriculture Committee Chairman Collin Peterson in two letters to USDA Secretary Sonny Perdue dated June 9, 2020,
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Similarly, the cost premiums of organic crops are not captured by a national average price. Another concern related to smal -scale producers is that—because of their dependence on local markets—they are often less able to pivot to new markets as easily as larger growers due to technology barriers or a lack of social capital or customer base.44 As a result, for many of these affected specialty crop producers, the CFAP methodology may have either excluded their commodities from eligibility or did not adequately value the resultant sales losses or marketing
costs.
Additional y, USDA elected to provide payments to non-specialty crops based on unsold
inventories held on January 15, 2020. Payments for specialty crops and livestock were based on commodities sales between January 15 and April 15, 2020. Congress may be interested in understanding how the decision to make payments for non-specialty crops based on unsold
inventories impacted the extent of compensation made available for other agricultural sectors.
Another concern some express relates to the types of losses that are not covered by CFAP-1 payments. This includes the costs of disposing of animal carcasses that resulted from farm-level depopulation efforts to deal with unsustainable stocking densities due to a backing up of market-ready cattle, hogs, and poultry in the food supply chain. In addition, CFAP-1 excluded
commodities that are routinely grown under contract, such as potatoes and malting barley. Also
excluded are processed food commodities (e.g., raisins) and aquaculture. 45
Similarly, to be eligible, a producer must stil control the affected commodity. If the producer has
already sold the commodity (perhaps out of financial necessity to meet cash flow requirements), then that portion of commodity is no longer eligible for any CFAP-1 assistance—no matter what type of sales loss might have resulted from the sale. Additional y, if contracted producers incurred losses because they were provided with fewer animals than they original y expected to raise under
contract, these losses would not be eligible for CFAP-1 assistance.
Concern has also been expressed about USDA’s rigid selection of dates—January 15 and April 15—for covering livestock sales. COVID-19 livestock market declines did not begin until February 2020, and some of the lowest market prices persisted beyond April 15. As a result, by
arbitrarily selecting the program dates, according to this critique, USDA was in effect picking winners and losers based solely on when livestock was sold without regard to actual market
conditions.46
Another concern involved congressionalpossible.
2. Congress may also be interested in evaluating whether CFAP payments help
mitigate the damage caused by the COVID-19 pandemic. Will additional assistance be necessary later this year? Is additional assistance needed to support certain affected industries that are not eligible under USDA’s initial CFAP rollout?
3. Another immediate concern may be monitoring and oversight of the large sums
monitoring and oversight of the large sums of taxpayer money that of taxpayer money that
will wil be flowing out through the USDA and the CCC. be flowing out through the USDA and the CCC.
ProducerThis concern stemmed from the idea that producer self-certification of the farm data needed to calculate losses self-certification of the farm data needed to calculate losses
maymight create create
an an
incentive to over-report losses. incentive to over-report losses.
4. Congress may evaluate whether CFAP will serve as a useful template for future
disaster response programs.
35 See CRS Report R45310, Farm Policy: USDA’s 2018 Trade Aid Package, CRS Report R45865, Farm Policy:
USDA’s 2019 Trade Aid Package, and CRS In Focus IF11539, Wildfires and Hurricanes Indemnity Program (WHIP). 36 USDA, “Coronavirus Food Assistance Program: Cost Benefit Analysis,” May 14, 2020, p. 8.
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Appendix. Supplementary Tables
Table A-1. CFAP Payment Rates (PRs): Non-Specialty Crops, Dairy, & Livestock
Price Change ($ per unit)
Payment Rates
Average:
Average:
Decline
%
CARES
Commodity
Unit
Jan. 13-17
Apr. 6-9
(PD)a
change
Act
CCC
Non-Specialty Cropsb
50% PD
55% PD
Barley (malting)
Bu.
$4.27
$3.60
$0.67
15.7%
$0.34
$0.37
Canola
Lb.
$0.17
$0.15
$0.02
11.8%
$0.01
$0.01
Corn
Bu.
$3.93
$3.30
$0.63
16.0%
$0.32
$0.35
Durum wheat
Bu.
$5.83
$5.46
$0.37
6.3%
$0.19
$0.20
Hard red spring wheat
Bu.
$5.64
$5.28
$0.36
6.4%
$0.18
$0.20
Mil et
Bu.
$6.19
$5.57
$0.62
10.0%
$0.31
$0.34
Oats
Bu.
$3.04
$2.74
$0.30
9.9%
$0.15
$0.17
Sorghum
Bu.
$3.73
$3.14
$0.59
15.8%
$0.30
$0.32
Soybeans
Bu.
$9.47
$8.57
$0.90
9.5%
$0.45
$0.50
Sunflowers
Lb.
$0.18
$0.15
$0.03
16.7%
$0.02
$0.02
Upland cotton
Lb.
$0.72
$0.54
$0.18
25.0%
$0.09
$0.10 Policy analysts and budget hawks have expressed concern about the potential for duplication of loss coverage between CFAP-1 and either the Agricultural Risk Coverage (ARC) and Price Loss
Coverage (PLC) programs or federal y subsidized crop insurance.47
and August 21, 2020.
44 Brad Hooker, “Smaller Farmers Are ‘Left Out’ Of Aid Programs,” AgriPulse, June 6, 2020. 45 House Agriculture Chairman Collin Peterson in a letter to USDA Secretary Perdue dated June 9, 2020. 46 House Agriculture Chairman Collin Peterson in a letter to USDA Secretary Perdue dated June 9, 2020. 47 For a description of the types of losses covered by ARC and PLC, or crop insurance, see CRS Report R45730, Farm Com m odity Provisions in the 2018 Farm Bill (P.L. 115 -334); or CRS Report R45193, Federal Crop Insurance: Program Overview for the 115th Congress.
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USDA’s Coronavirus Food Assistance Program: Round One (CFAP-1)
Congress may also be interested in evaluating whether CFAP-1 payments helped to mitigate the economic damage caused by the COVID-19 pandemic. Moreover, is additional assistance needed to support certain affected industries—such as various specialty crops—that were not eligible under USDA’s final expanded eligibility list? Wil additional assistance be necessary later this
year for the entire U.S. agricultural sector?48
As CFAP-1 winds down and more stakeholder feedback becomes available, Congress may evaluate whether CFAP-1 wil serve as a useful template for future disaster response programs,
and what changes might be necessary or useful in designing any future program.
48 USDA decided that the answer to these two questions was yes when, on September 18, 2020, USDA announced that it was initiating a second round of CFAP payments (CFAP -2) but under more expansive eligibility criteria and a new payment methodology. USDA, “USDA to Provide Additional Direct Assistance to Farmers and Ranchers Impacted by the Coronavirus,” Press Release No. 0378.20, September 18, 2020.
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Appendix. Supplementary Tables
Table A-1. CFAP-1 Payment Rates (PRs): Non-Specialty Crops, Dairy, & Livestock
Price Change ($ per unit)
Payment Rates
Average:
Average:
Decline
%
CARES
Commodity
Unit
Jan. 13-17
Apr. 6-9
(PD)a
decline
Act
CCC
Non-Specialty Cropsb
50% PD
55% PD
Barley (malting)
Bu.
$4.27
$3.60
$0.67
15.7%
$0.34
$0.37
Canola
Lb.
$0.17
$0.15
$0.02
11.8%
$0.01
$0.01
Corn
Bu.
$3.93
$3.30
$0.63
16.0%
$0.32
$0.35
Durum wheat
Bu.
$5.83
$5.46
$0.37
6.3%
$0.19
$0.20
Hard red spring wheat
Bu.
$5.64
$5.28
$0.36
6.4%
$0.18
$0.20
Mil et
Bu.
$6.19
$5.57
$0.62
10.0%
$0.31
$0.34
Oats
Bu.
$3.04
$2.74
$0.30
9.9%
$0.15
$0.17
Sorghum
Bu.
$3.73
$3.14
$0.59
15.8%
$0.30
$0.32
Soybeans
Bu.
$9.47
$8.57
$0.90
9.5%
$0.45
$0.50
Sunflowers
Lb.
$0.18
$0.15
$0.03
16.7%
$0.02
$0.02
Upland cotton
Lb.
$0.72
$0.54
$0.18
25.0%
$0.09
$0.10
Dairyc
80% PD
25% PD
Dairy
Dairy
Cwt.
Cwt.
$17.61
$17.61
$11.72
$11.72
$5.89
$5.89
33.4%
33.4%
$4.71
$4.71
$1.47
$1.47
Livestockd
80% PD
Costse
Slaughter cattle:
Slaughter cattle:
fedffedf
Head
Head
$1,736
$1,736
$1,469
$1,469
$267
$267
15.4%
15.4%
$214
$214
$33
$33
Slaughter cattle: matur
Slaughter cattle: matur
eg Head Head
$744
$744
$630
$630
$114
$114
15.3%
15.3%
$92
$92
$33
$33
Feeder
Feeder
cattle: < 600 lbcattle: < 600 lb
s.h
Head Head
$812
$812
$685
$685
$127
$127
15.6%
15.6%
$102
$102
$33
$33
Feeder
Feeder
cattle: >600 lbcattle: >600 lb
s.i
Head
Head
$1,107
$1,107
$934
$934
$173
$173
15.6%
15.6%
$139
$139
$33
$33
All Al other cattlother cattl
ej
Head
Head
$812
$812
$685
$685
$127
$127
15.6%
15.6%
$102
$102
$33
$33
PigskPigsk
Head
Head
nal
na
na
$35
$35
58%
58%
$28
$28
$17
$17
HogsmHogsm
Head
Head
na
na
na
na
$23
$23
21%
21%
$18
$18
$17
$17
Lambs and
Lambs and
yearlingsnyearlingsn
Head
Head
na
na
na
na
$41
$41
26%
26%
$33
$33
$7
$7
Woolo
Al Other Sheepo
Head
na
na
na
na
$24
$7
Woolp
50% PD
55% PD
(graded, clean)
(graded, clean)
Lb.
Lb.
$5.04
$5.04
$3.62 $3.62
$1.42
$1.42
28.2%
28.2%
$0.71
$0.71
$0.78
$0.78
(non-graded, greasy
(non-graded, greasy
)pq
Lb.
Lb.
—
—
—
—
—
—
—
—
$0.36
$0.36
$0.39
$0.39
Sources: USDA,USDA,
FSA, “Coronavirus Food Assistance Program,”FSA, “Coronavirus Food Assistance Program,”
Final Rule, 85 Final Rule, 85
Federal Register 30825, May 21, 30825, May 21,
2020; 2020;
and USDA, FSA, “Coronavirus Food Assistance ProgramUSDA, FSA, “Coronavirus Food Assistance Program
Cost-Benefit Analysis,Cost-Benefit Analysis,
May May 14, 2020; and 85 Federal Register 49589, August 14, 2020. According 14, 2020. According
to USDA, commodityto USDA, commodity
prices are drawn from severalprices are drawn from several
sources. sources as fol ows.
For non-specialty crops with futures market data, quotes for May futures contracts from
For non-specialty crops with futures market data, quotes for May futures contracts from
various exchanges various exchang es are are
used: Chicago Mercantile Exchange (CME) for corn, soybeans, and oats; Minneapolis Grain Exchange for hard used: Chicago Mercantile Exchange (CME) for corn, soybeans, and oats; Minneapolis Grain Exchange for hard
red spring (HRS) wheat; and the Intercontinental Exchange for cotton and canola. Sorghum is calculated as 95% red spring (HRS) wheat; and the Intercontinental Exchange for cotton and canola. Sorghum is calculated as 95%
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of the corn futures price, of the corn futures price, durum wheat is 103.4% of the HRS wheat futures price, sunflowersdurum wheat is 103.4% of the HRS wheat futures price, sunflowers
is the soybean oil is the soybean oil
Congressional Research Service
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CME futures price divided by two, plus one cent. AMS data is used for other nonCME futures price divided by two, plus one cent. AMS data is used for other non
-specialty crops where futures -specialty crops where futures
contracts are not traded. contracts are not traded.
For specialty crops, price data was provided by AMS and represents
For specialty crops, price data was provided by AMS and represents
an average of an average of
all al units shipped of domestic units shipped of domestic
production, whether conventional or organic. The raw data source for the prices is the AMS Market News production, whether conventional or organic. The raw data source for the prices is the AMS Market News
Portal, https://www.ams.usda.gov/market-news/fruits-vegetables.Portal, https://www.ams.usda.gov/market-news/fruits-vegetables.
The prices are for the shipping point if available, The prices are for the shipping point if available,
or terminalor terminal
market if not. For any particular crop, shipping point and terminalmarket if not. For any particular crop, shipping point and terminal
market market prices are not mixed. prices are not mixed.
For livestock
For livestock
prices,prices,
price data was provided by AMS for cattle, hogs, milkprice data was provided by AMS for cattle, hogs, milk
(Class III and Class IV), and lamb and (Class III and Class IV), and lamb and
yearlings.yearlings.
The weighting of milkThe weighting of milk
class prices to represent class prices to represent
allal -milk-milk
prices is described in the notes below. prices is described in the notes below.
Adjustments to per-pound pricesAdjustments to per-pound prices
to account for liveto account for live
weight for cattle, hogs, and pigs are described in the notes weight for cattle, hogs, and pigs are described in the notes
below. For wool,below. For wool,
instead of a futures or cash price, the difference in the Eastern Market Indicator, as reported instead of a futures or cash price, the difference in the Eastern Market Indicator, as reported
by AMS in the by AMS in the
National Wool Review, for the same, for the same
two week periods two-week period is used to calculate the price decline. is used to calculate the price decline.
Notes: PD = price decline;PD = price decline;
na = not available.na = not available.
a. The price decline (PD) is the differencea. The price decline (PD) is the difference
between the weeklybetween the weekly
average of the futures contract prices (or average of the futures contract prices (or
weekly
weekly
average of the cash pricesaverage of the cash prices
if the futures prices are unavailable) for the weeksif the futures prices are unavailable) for the weeks
of January 13of January 13
-17, 2020, -17, 2020,
and Apriland April
6-9, 2020. Non-specialty crops and livestock commodities6-9, 2020. Non-specialty crops and livestock commodities
whose price decline is at least 5% are whose price decline is at least 5% are
listed in this table and are eligiblelisted in this table and are eligible
for a CFAP payment as describedfor a CFAP payment as described
inin
Table 2.
b. For
b. For
all al non-specialty crops, the CARES Act payment rate is 50% of the PD; the CCC payment rate is 55% of non-specialty crops, the CARES Act payment rate is 50% of the PD; the CCC payment rate is 55% of
the PD.
the PD.
c. Dairy prices
c. Dairy prices
use an average of Class III (60% weight) and Class IV (40% weight) prices; the CARES Act use an average of Class III (60% weight) and Class IV (40% weight) prices; the CARES Act
payment rate is 80% of the calculated price decline; the CCC payment rate is 25% of the
payment rate is 80% of the calculated price decline; the CCC payment rate is 25% of the
price decline. decline.
d. For livestock,
d. For livestock,
the CARES Act payment rate is 80% of the price decline.the CARES Act payment rate is 80% of the price decline.
e. The CCC payment rate for livestocke. The CCC payment rate for livestock
is based on projected costs likelyis based on projected costs likely
to be incurred for marketingto be incurred for marketing
the the
2020 inventory after April
2020 inventory after April
15, 2020, due to disrupted markets.15, 2020, due to disrupted markets.
f.
f.
Fed cattle are cattle that are market-ready (with a weight of 1,200 lbs. or more) and intended for slaughter.
Fed cattle are cattle that are market-ready (with a weight of 1,200 lbs. or more) and intended for slaughter.
The price loss per-head of fed cattle is approximated by first calculating the difference between the weekly The price loss per-head of fed cattle is approximated by first calculating the difference between the weekly
average prices for January 13-17, 2020, and Aprilaverage prices for January 13-17, 2020, and April
6-9, 2020. These values are multiplied6-9, 2020. These values are multiplied
by 14 (assuming an by 14 (assuming an
average weight of 1,400 lbs. or 14 cwt) to approximate the equivalent per-head values for fed cattle. average weight of 1,400 lbs. or 14 cwt) to approximate the equivalent per-head values for fed cattle.
g. Mature cattle are either cul cattle from a dairy herd, or breeding livestock
g. Mature cattle are either cul cattle from a dairy herd, or breeding livestock
that have been removedthat have been removed
from from
inventory and are intended for slaughter. Similar
inventory and are intended for slaughter. Similar
to the procedure used for fed cattle, per-head prices for to the procedure used for fed cattle, per-head prices for
mature cattle are approximated by multiplying the per-cwt calculated average pricesmature cattle are approximated by multiplying the per-cwt calculated average prices
and their difference by and their difference by
50% and 12 because cul ed cattle 50% and 12 because cul ed cattle
typicallytypical y weight about 1,200 lbs. and are worth weight about 1,200 lbs. and are worth
approximately halfapp roximately half that of fed of fed
cattle. cattle.
h. Feeder
h. Feeder
cattle are young cattle that are taken off pasture and brought to a feedlot for finishing weight gain to cattle are young cattle that are taken off pasture and brought to a feedlot for finishing weight gain to
achieve market-ready status prior to slaughter. For feeder cattle under 600 lbs., the calculated average
achieve market-ready status prior to slaughter. For feeder cattle under 600 lbs., the calculated average
prices and their differenceprices and their difference
are multipliedare multiplied
by 5.5 to represent the average weight of 550 lbs. by 5.5 to represent the average weight of 550 lbs.
i.
i.
Similarly,
Similarly,
for feeder cattle over 600 lbs., the calculated average prices and their difference are multipliedfor feeder cattle over 600 lbs., the calculated average prices and their difference are multiplied
by by
7.5 to represent 750 lbs.,7.5 to represent 750 lbs.,
the average weight when feeder cattle are placed on feed. the average weight when feeder cattle are placed on feed.
j.
j.
Commercially Commercial y raised or maintained bovine animalsraised or maintained bovine animals
not meetingnot meeting
definitions of other cattle categories, definitions of other cattle categories,
excluding beefalo, bison, and animals used for dairy production. excluding beefalo, bison, and animals used for dairy production.
k. Pigs are any swine that weighs less than 120 lbs.
k. Pigs are any swine that weighs less than 120 lbs.
l. l.
USDA did not provide the price averages used to calculate the price decline for pigs, hogs, and lambs and
USDA did not provide the price averages used to calculate the price decline for pigs, hogs, and lambs and
yearlings. yearlings.
m. Hogs are any swine that
m. Hogs are any swine that
weightsweighs more more
than 120 lbs. For hogs, the negotiated purchase prices as reported than 120 lbs. For hogs, the negotiated purchase prices as reported
by by
AMS (https://mpr.datamart.ams.usda.gov/)AMS (https://mpr.datamart.ams.usda.gov/)
were used to calculate the price change between the two were used to calculate the price change between the two
periods. periods.
n. Lambs and yearlings
n. Lambs and yearlings
are all are al sheep less than two years of age. sheep less than two years of age.
o. o.
Wool Al sheep greater than two years of age. Added as an eligible commodity by 85 Federal Register 49589,
August 14, 2020.
p. Wool means the fiber sheared frommeans the fiber sheared from
a livea live
sheep and includes, unless noted otherwise,sheep and includes, unless noted otherwise,
graded and graded and
nongraded wool.
nongraded wool.
Graded wool is paid on a clean basis, and ungraded wool is paid on a greasy basis. For Graded wool is paid on a clean basis, and ungraded wool is paid on a greasy basis. For
all al wool,wool,
the CARES Act payment rate is 50% of the PD; the CCC payment rate is 55% of the PD. the CARES Act payment rate is 50% of the PD; the CCC payment rate is 55% of the PD.
pq. USDA uses a 50% conversion rate from greasy wool to clean wool,. USDA uses a 50% conversion rate from greasy wool to clean wool,
thus the payment rates for greasy wool thus the payment rates for greasy wool
are set at half the value of clean wool.
are set at half the value of clean wool.
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Table A-2. CFAP-1 Payment Rates (PRs): for Specialty Crops
Price Changea ($ per lb.)
Payment Rates (PR)
Avg. Price:
Avg. Price:
Price Decline (PR)
Average
Average
Price
CARES Act PR-1:
CARES Act PR-2: for
CCC PR-3:
Commodity
Jan. 13-17
Apr. 6-10
(PD)b
% PD
Sales Lossesc (80% PD) product spoilaged
unsold PR-3:
Price: Jan.
Price: Apr.
Decline
%
for Sales Lossesc
product spoilage due to
for unsold
Commodity
13-17
6-10
(PD)b
change
80% of PD
market disruptiond
inventorye
($/lb)
($/lb)
($/lb)
($/lb)
($/lb)
($/lb)
%
%
PR-1 ($/lb)($/lb)
PR-2 ($/lb)($/lb)
PR-3 ($/lb)($/lb)
Alfalfa Sprouts
—
—
—
—
—
$8.14
$1.59
Almonds
$1.90
$1.58
$0.32 Almonds
$1.90
$1.58
$0.32
16.8%
16.8%
$0.26
$0.26
$0.57
$0.57
$0.11
$0.11
Aloe Leaves
na
na
na
na
$0.06
$0.19
$0.04
Anise
na
na
na
na
$0.88
$0.81
$0.16
Apples
Apples
—
—
—
—
—
—
—
—
—
—
$0.18
$0.18
$0.03
$0.03
Artichokes
Artichokes
$1.64
$1.64
$0.81
$0.81
$0.83
$0.83
50.6%
50.6%
$0.66
$0.66
$0.49
$0.49
$0.10
$0.10
Arugula
—
—
—
—
—
$4.64
$0.91
Asparagus
Asparagus
—
—
—
—
—
—
—
—
—
—
$0.38
$0.38
$0.07
$0.07
Avocados
Avocados
—
—
—
—
—
—
—
—
—
—
$0.14
$0.14
$0.03
$0.03
Beans
$0.55
$0.33
$0.22
40.0%
$0.17
$0.16
$0.03
Blueberries
—
—
—
—
—
$0.62
$0.12
Broccoli
$1.62
$0.84
$0.78
48.1%
$0.62
$0.49
$0.10
Cabbage
$0.22
$0.16
$0.05
27.3%
$0.04
$0.07
$0.01
Cantaloupe
—
—
—
—
—
$0.10
$0.02
Carrots
$0.38
$0.35
$0.03
7.9%
$0.02
$0.11
$0.02
Cauliflower
$1.02
$0.89
$0.14
12.7%
$0.11
$0.31
$0.06
Celery
—
—
—
—
—
$0.07
$0.01
Corn, sweet
$0.43
$0.31
$0.11
27.9%
$0.09
$0.13
$0.03
Cucumbers
$0.50
$0.34
$0.16
32.0%
$0.13
$0.15
$0.03
Eggplant
$0.50
$0.40
$0.09
20.0%
$0.07
$0.15
$0.03
Garlic
—
—
—
—
—
$0.85
$0.17
Grapefruit
—
—
—
—
—
$0.11
$0.02
Kiwifruit
—
—
—
—
—
$0.32
$0.06
Lemons
$0.70
$0.61
$0.09
12.9%
$0.08
$0.21
$0.04
Lettuce, iceberg
$0.50
$0.25
$0.25
50.0%
$0.20
$0.15
$0.03
Lettuce, romaine
$0.40
$0.31
$0.09
22.5%
$0.07
$0.12
$0.02
CRS-18
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Price Changea ($ per lb.)
Payment Rates (PR)
Average
Average
Price
CARES Act PR-1:
CARES Act PR-2: for
CCC PR-3:
Price: Jan.
Price: Apr.
Decline
%
for Sales Lossesc
product spoilage due to
for unsold
Commodity
13-17
6-10
(PD)b
change
80% of PD
market disruptiond
inventorye
Mushrooms
—
—
—
—
—
$0.59
$0.11
Onions, dry
$0.18
$0.16
$0.02
11.1%
$0.01
$0.05
$0.01
Onions, green
—
—
—
—
—
$0.30
$0.06
Oranges
—
—
—
—
—
$0.14
$0.03
Papaya
—
—
—
—
—
$0.32
$0.06
Peaches
$1.05
$0.96
$0.09
8.6%
$0.08
$0.32
$0.06
Pears
$0.58
$0.49
$0.09
15.5%
$0.08
$0.18
$0.03
Pecans
$3.10
$2.76
$0.34
11.0%
$0.28
$0.93
$0.18
Peppers, bell type
$0.73
$0.56
$0.17
23.3%
$0.14
$0.22
$0.04
Peppers, other
$0.73
$0.55
$0.18
24.7%
$0.15
$0.22
$0.04
Potatoes
—
—
—
—
—
$0.04
$0.01
Raspberries
—
—
—
—
—
$1.45
$0.28
Rhubarb
$3.42
$3.23
$0.19
5.6%
$0.15
$1.03
$0.20
Spinach
$1.22
$0.77
$0.45
36.9%
$0.37
$0.37
$0.39
Squash
$1.30
$0.40
$0.90
69.2%
$0.72
$0.39
$0.08
Strawberries
$2.40
$1.35
$1.05
43.8%
$0.84
$0.72
$0.14
Sweet potatoes
—
—
—
—
—
$0.18
$0.04
Tangerines
—
—
—
—
—
$0.22
$0.04
Taro
—
—
—
—
—
$0.23
$0.05
Tomatoes
$1.26
$0.46
$0.80
63.5%
$0.64
$0.38
$0.07
Walnuts
—
—
—
—
—
$0.45
$0.09
Watermelons
—
—
—
—
—
$0.02
—
Sources: USDA, FSA, “Coronavirus Food Assistance Program,” Final Rule, 85 Federal Register 30825, May 21, 2020; and USDA, FSA, “Coronavirus Food Assistance Program Cost-Benefit Analysis, May 14, 2020.
CRS-19
link to page 10
Notes: Specialty crops include, but are not limited to, those commodities listed in this table. An “—” signifies that either a price increase occurred between the two
Bananas
na
na
na
na
$0.34
$0.20
$0.04
Basil
na
na
na
na
$0.30
$1.65
$0.32
Batatas
—
—
—
—
—
$0.32
$0.06
Bean Sprouts
—
—
—
—
—
$0.26
$0.05
Beans
$0.55
$0.33
$0.22
40.0%
$0.17
$0.16
$0.03
Beets
—
—
—
—
—
$0.30
$0.06
Blackberries
na
na
na
na
$1.72
$2.11
$0.41
Blueberries
—
—
—
—
—
$0.62
$0.12
Bok Choy
na
na
na
na
$0.22
$0.23
$0.05
Broccoli
$1.62
$0.84
$0.78
48.1%
$0.62
$0.49
$0.10
Brussels Sprouts
na
na
na
na
$0.26
$0.34
$0.07
Cabbage
$0.22
$0.16
$0.06
27.3%
$0.04
$0.07
$0.01
Cantaloupe
—
—
—
—
—
$0.10
$0.02
Carambola (Star Fruit)
—
—
—
—
—
$0.58
$0.11
CRS-19
link to page 28 link to page 28 link to page 28 link to page 28 link to page 28
Price Changea ($ per lb.)
Payment Rates (PR)
Avg. Price:
Avg. Price:
Price Decline
CARES Act PR-1:
CARES Act PR-2:
CCC PR-3:
Commodity
Jan. 13-17
Apr. 6-10
(PD)b
% PD
Sales Lossesc (80% PD) product spoilaged
unsold inventorye
Carrots
$0.38
$0.35
$0.03
7.9%
$0.20
$0.11
$0.02
Cauliflower
$1.02
$0.89
$0.13
12.7%
$0.11
$0.31
$0.06
Celeriac (Celery Root)
—
—
—
—
—
$0.52
$0.10
Celery
—
—
—
—
—
$0.07
$0.01
Cherimoya
na
na
na
na
$1.83
$0.98
$0.19
Chervil (French Parsley)
na
na
na
na
$2.74
$8.09
$1.58
Chives
—
—
—
—
—
$1.32
$0.26
Cilantro
na
na
na
na
$0.19
$0.23
$0.05
Cilantro (Coriander)
na
na
na
na
$0.19
$0.23
$0.05
Citron
na
na
na
na
$0.32
$0.26
$0.05
Coconuts
—
—
—
—
—
$0.25
$0.05
Col ard Greens
na
na
na
na
$0.04
$0.21
$0.04
Corn, sweet
$0.43
$0.31
$0.12
27.9%
$0.09
$0.13
$0.03
Cucumbers
$0.50
$0.34
$0.16
32.0%
$0.13
$0.15
$0.03
Curry Leaves
na
na
na
na
$2.40
$5.25
$1.03
Daikon
—
—
—
—
—
$0.19
$0.04
Dandelion Greens
na
na
na
na
$0.06
$0.26
$0.05
Dates
—
—
—
—
—
$1.44
$0.28
Dil
—
—
—
—
—
$5.38
$1.05
Donaqua (Winter Melon)
na
na
na
na
$1.42
$0.60
$0.12
Dragon Fruit (Red Pitaya)
—
—
—
—
—
$1.03
$0.20
Eggplant
$0.50
$0.40
$0.09
20.0%
$0.07
$0.15
$0.03
Endive
na
na
na
na
$0.04
$0.15
$0.03
Escarole
na
na
na
na
$0.11
$0.18
$0.04
Filberts
na
na
na
na
$0.41
$0.67
$0.13
Frisee
—
—
—
—
—
$0.69
$0.14
CRS-20
link to page 28 link to page 28 link to page 28 link to page 28 link to page 28
Price Changea ($ per lb.)
Payment Rates (PR)
Avg. Price:
Avg. Price:
Price Decline
CARES Act PR-1:
CARES Act PR-2:
CCC PR-3:
Commodity
Jan. 13-17
Apr. 6-10
(PD)b
% PD
Sales Lossesc (80% PD) product spoilaged
unsold inventorye
Garlic
—
—
—
—
—
$0.85
$0.17
Grapefruit
—
—
—
—
—
$0.11
$0.02
Greens (others not listed)
na
na
na
na
$0.08
$0.16
$0.03
Guava
na
na
na
na
$1.52
$1.73
$0.34
Horseradish
—
—
—
—
—
$3.72
$0.73
Kale Greens
—
—
—
—
—
$0.22
$0.04
Kiwifruit
—
—
—
—
—
$0.32
$0.06
Kohlrabi
—
—
—
—
—
$0.24
$0.05
Kumquats
na
na
na
na
$1.28
$1.76
$0.34
Leeks
na
na
na
na
$0.14
$0.18
$0.03
Lemons
$0.70
$0.61
$0.09
12.9%
$0.08
$0.21
$0.04
Lettuce, Boston
na
na
na
na
$0.09
$0.34
$0.07
Lettuce, Green Leaf
na
na
na
na
$0.44
$0.60
$0.12
Lettuce, Lol a Rossa
—
—
—
—
—
$1.69
$0.33
Lettuce, Oak Leaf—Green
—
—
—
—
—
$1.69
$0.33
Lettuce, Oak Leaf—Red
—
—
—
—
—
$1.69
$0.33
Lettuce, Red Leaf
na
na
na
na
$0.42
$0.60
$0.12
Lettuce, iceberg
$0.50
$0.25
$0.25
50.0%
$0.20
$0.15
$0.03
Lettuce, romaine
$0.40
$0.31
$0.09
22.5%
$0.07
$0.12
$0.02
Mamey Sapote
na
na
na
na
$0.56
$0.92
$0.18
Maple Sap* (for Maple Syrup)
na
na
na
na
$0.07
$0.20
$0.04
Marjoram
na
na
na
na
$1.06
$1.42
$0.28
Mesculin Mix
—
—
—
—
—
$0.79
$0.16
Microgreens
—
—
—
—
—
$7.15
$1.40
Mint
—
—
—
—
—
$7.47
$1.46
Mint (Others not listed)
—
—
—
—
—
$0.93
$0.18
CRS-21
link to page 28 link to page 28 link to page 28 link to page 28 link to page 28
Price Changea ($ per lb.)
Payment Rates (PR)
Avg. Price:
Avg. Price:
Price Decline
CARES Act PR-1:
CARES Act PR-2:
CCC PR-3:
Commodity
Jan. 13-17
Apr. 6-10
(PD)b
% PD
Sales Lossesc (80% PD) product spoilaged
unsold inventorye
Mushrooms
—
—
—
—
—
$0.59
$0.11
Mustard
—
—
—
—
—
$0.21
$0.04
Nectarines
—
—
—
—
—
$0.30
$0.06
Okra
na
na
na
na
$0.31
$0.46
$0.09
Onions, dry
$0.18
$0.16
$0.02
11.1%
$0.01
$0.05
$0.01
Onions green
—
—
—
—
—
$0.30
$0.06
Oranges
—
—
—
—
—
$0.14
$0.03
Oregano
—
—
—
—
—
$1.22
$0.24
Papaya
—
—
—
—
—
$0.32
$0.06
Parsley
na
na
na
na
$0.19
$0.23
$0.04
Parsnips
na
na
na
na
$0.06
$0.40
$0.08
Passion Fruit
na
na
na
na
$0.89
$3.21
$0.63
Peaches
—
—
—
—
—
$0.32
$0.06
Pears
$0.58
$0.49
$0.09
15.5%
$0.08
$0.18
$0.03
Peas Green
na
na
na
na
$0.10
$0.36
$0.07
Pecans
$3.10
$2.76
$0.34
11.0%
$0.28
$0.93
$0.18
Peppermint
na
na
na
na
$1.60
$5.40
$1.06
Peppers, bel type
$0.73
$0.56
$0.17
23.3%
$0.14
$0.22
$0.04
Peppers, other
$0.73
$0.55
$0.18
24.7%
$0.15
$0.22
$0.04
Persimmons
—
—
—
—
—
$0.53
$0.10
Pineapples
—
—
—
—
—
$0.23
$0.04
Pistachios
—
—
—
—
—
$0.74
$0.14
Pistachios
na
na
na
na
$0.22
$1.28
$0.25
Plantains
na
na
na
na
$0.18
$0.15
$0.03
Pomegranates
—
—
—
—
—
$0.54
$0.11
Potatoes, fresh other
—
—
—
—
$0.01
$0.04
$0.01
CRS-22
link to page 28 link to page 28 link to page 28 link to page 28 link to page 28
Price Changea ($ per lb.)
Payment Rates (PR)
Avg. Price:
Avg. Price:
Price Decline
CARES Act PR-1:
CARES Act PR-2:
CCC PR-3:
Commodity
Jan. 13-17
Apr. 6-10
(PD)b
% PD
Sales Lossesc (80% PD) product spoilaged
unsold inventorye
Potatoes, fresh Russets
—
—
—
—
$0.07
$0.09
$0.02
Potatoes, processing
—
—
—
—
$0.02
$0.03
$0.01
Potatoes, seed
—
—
—
—
$0.02
$0.04
$0.01
Pummelos
—
—
—
—
—
$0.21
$0.04
Pumpkins
na
na
na
na
$0.72
$0.39
$0.08
Radicchio
—
—
—
—
—
$0.72
$0.14
Raspberries
—
—
—
—
—
$1.45
$0.28
Rhubarb
—
—
—
—
—
$1.03
$0.20
Rosemary
—
—
—
—
—
$2.60
$0.51
Rutabagas
na
na
na
na
$0.08
$0.19
$0.04
Sage
na
na
na
na
$0.72
$3.06
$0.60
Savory
—
—
—
—
—
$0.62
$0.12
Shal ots
na
na
na
na
$0.51
$0.70
$0.14
Sorrel
—
—
—
—
—
$2.85
$0.56
Spearmint
na
na
na
na
$1.60
$4.80
$0.94
Spinach
$1.22
$0.77
$0.45
36.9%
$0.37
$0.37
$0.39
Squash
$1.30
$0.40
$0.90
69.2%
$0.72
$0.39
$0.08
Strawberries
$2.40
$1.35
$1.05
43.8%
$0.84
$0.72
$0.14
Sugarcane, table
—
—
—
—
—
$0.14
$0.03
Sweetpotatoes
—
—
—
—
—
$0.18
$0.04
Swiss Chard
—
—
—
—
—
$0.25
$0.05
Tangelos
na
na
na
na
$0.05
$0.22
$0.04
Tangerines
—
—
—
—
—
$0.22
$0.04
Taro
—
—
—
—
—
$0.23
$0.05
Thyme
—
—
—
—
—
$2.63
$0.51
Tomatoes
$1.26
$0.46
$0.80
63.5%
$0.64
$0.38
$0.07
CRS-23
link to page 28 link to page 28 link to page 28 link to page 28 link to page 28 link to page 13
Price Changea ($ per lb.)
Payment Rates (PR)
Avg. Price:
Avg. Price:
Price Decline
CARES Act PR-1:
CARES Act PR-2:
CCC PR-3:
Commodity
Jan. 13-17
Apr. 6-10
(PD)b
% PD
Sales Lossesc (80% PD) product spoilaged
unsold inventorye
Turmeric
—
—
—
—
—
$1.05
$0.20
Turnip Tops Greens
—
—
—
—
—
$0.19
$0.04
Turnips (Celeriac)
—
—
—
—
—
$0.20
$0.04
Upland and Winter Cress
—
—
—
—
—
$2.18
$0.43
Walnuts
—
—
—
—
—
$0.45
$0.09
Watercress
—
—
—
—
—
$2.18
$0.43
Watermelons
—
—
—
—
—
$0.02
—
Yautia (Malanga)
na
na
na
na
$0.48
$0.42
$0.08
Yuca (Cassava)
—
—
—
—
—
$0.16
$0.03
Sources: USDA, FSA, “CFAP,” Final Rule, 85 Federal Register 30825, May 21, 2020, as corrected by: USDA, FSA, “CFAP Additional Eligible Commodities,” 85 Federal Register 35799, June 12, 2020; USDA, FSA, “CFAP Additional Eligible Commodities,” 85 Federal Register 41321, July 10, 2020; USDA, FSA, “CFAP Correction,” 85 Federal Register 41328, July 10, 2020; USDA, FSA, “CFAP Additional Eligible Commodities,” 85 Federal Register 49589, August 14, 2020; and USDA, FSA, “CFAP Correction,” 85 Federal Register 49593, August 14, 2020. Notes: CFAP-1 = Coronavirus Food Assistance Program, First Round; na = not available. Specialty crops include, but are not limited to, those commodities listed in this table. An “—” under the sixth column (CARES Act PR-1) signifies that either a price increase occurred between the two periods used to calculate the price change, or the price decrease was less than 5%, hence no payment wilperiods used to calculate the price change, or the price decrease was less than 5%, hence no payment wil
be made under CARES Act PR-1. However,be made under CARES Act PR-1. However,
the commodity the commodity
may be eligiblemay be eligible
for payments under CARES Act for payments under CARES Act
PR-2 and CCC PR-3. USDA has not provided any information on the prices used for those commodities added after the initial rule was released on May 21, 2020. Prices that appear in this table have been rounded to two digits to the right of the decimal—as a result, differences may not equate directly with the table data.PR-2 and CCC PR-3.
a. Weeklya. Weekly
AMS cash prices are used to calculate the average prices for the two periods.AMS cash prices are used to calculate the average prices for the two periods.
b. The price decline is the difference in the weeklyb. The price decline is the difference in the weekly
average of cash pricesaverage of cash prices
between the weeksbetween the weeks
of January 13of January 13
-17, 2020, and April-17, 2020, and April
6-10, 2020. Commodities6-10, 2020. Commodities
whose price whose price
decline is equal to or greater than 5% are eligible
decline is equal to or greater than 5% are eligible
for a CFAP payment based on the CARES Act PR-1 payment rate as described infor a CFAP payment based on the CARES Act PR-1 payment rate as described in
Table 2.
c. The CARES Act payment rate (PR-1) for price losses
c. The CARES Act payment rate (PR-1) for price losses
equals 80% of the calculated price decline.equals 80% of the calculated price decline.
d. The CARES Act payment rate (PR-2) for market spoilage equals 30% of the lost value of any shipment.d. The CARES Act payment rate (PR-2) for market spoilage equals 30% of the lost value of any shipment.
e. The CCC payment rate (PR-3) for unsold inventory equals 5.875% of the crop’s value. The 5.875% is calculated as 25% of the average price decline (of 23.5%) across e. The CCC payment rate (PR-3) for unsold inventory equals 5.875% of the crop’s value. The 5.875% is calculated as 25% of the average price decline (of 23.5%) across
specialty crops for which data was available.
specialty crops for which data was available.
CRS-
CRS-
20
USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments
Table A-3. Additional USDA Forms for CFAP Eligibility
Form
Purpose
CCC-901
Member Information
CCC-901 identifies members of a farm or ranch that is a legal entity. Member Information wil be completed by legal entities and joint operations to col ect the fol owing: member names, addresses, and Tax Identification Numbers (TINs); and citizenship status. If any member of the legal entity is a foreign person, CCC-902 must be completed by the legal entity or joint operation.
CCC-902
Farm Operating Plan
For CFAP purposes only the fol owing fields on the CCC-902 form are required to be completed: names, addresses, and TINs; citizenship status; and contributions to the farming operation for foreign persons.
CCC-941
Average Adjusted Gross Income (AGI) Certification and Consent to Disclosure of Tax
Information
CCC-941 information is used to evaluate whether a producer is in compliance with AGI criteria.
CCC-942
Certification of Income from Farming, Ranching and Forestry Operations
CCC-942 must be completed if a producer exceeds the AGI criteria of $900,000, but derives at least 75% of income from farming activities.
AD-1026
Highly Erodible Land Conservation (HELC) and Wetland Conservation (WC)
Certification
AD-1026 certifies compliance with required conservation provisions.
AD-2047
Customer Data Worksheet Request for Business Partner Record Change
AD-2047 provides basic customer contact information.
SF-3881
ACH Vendor/Miscellaneous Payment Enrollment Form (Direct Deposit)
SF-3881 col ects a producer’s banking information to allow USDA to make payments to via direct deposit.
Source: USDA, Coronavirus Food Assistance Program, web portal, https://www.farmers.gov/cfap. Note: For producers that are existing FSA program participants, most of these forms are likely already on file at their local FSA Service Center. In addition to these forms, if requested by USDA, an applicant must provide documentation that verifies the quantities of production and/or inventory used in the application, and that establishes the applicant’s ownership share and value at risk for the commodity.
Author Information
Randy Schnepf
Specialist in Agricultural Policy
Congressional Research Service
21
USDA’s Coronavirus Food Assistance Program (CFAP) Direct Payments
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress. Information in a CRS Report should not24
link to page 29 USDA’s Coronavirus Food Assistance Program: Round One (CFAP-1)
Table A-3. CFAP-1 Payment Rates for Liquid and Frozen Eggs and Aquaculture
Added by USDA on August 14, 2020
CARES Act PR:
CCC PR:
Commodity
Unit
Sales Losses
unsold inventory
Liquid and Frozen Eggs
($/lb.)
($/lb.)
Liquid Eggs
Pound
$0.05
$0.02
Frozen Eggs
Pound
$0.06
$0.02
Aquaculture Commoditiesa
Crawfish
Pound
$0.65
$0.05
Catfish
Pound
—
$0.07
Largemouth Bass and Carp Sold as Food
Pound
$0.51
$0.39
Hybrid Striped Bass
Pound
—
$0.25
Red Drum
Pound
—
$0.24
Salmon
Pound
$1.14
$0.31
Sturgeon
Pound
—
$0.29
Tilapia
Pound
—
$0.16
Trout
Pound
—
$0.11
Ornamental or Tropical Fish
Pound
—
$0.03
Recreational Sportfish
Pound
—
$0.27
Source: 85 Federal Register 49589, August 14, 2020. Notes: CFAP-1 = Coronavirus Food Assistance Program, First Round. An “—” under the third column (CARES Act PR) signifies that either a price increase occurred between the two periods used to calculate the price change, or the price decrease was less than 5%, hence no payment wil be made under CARES Act PR. However, the commodity may be eligible for payments for a CCC payment to partial y offset additional marketing costs. a. In extending eligibility for CFAP payments to the identified aquaculture, USDA stated that aquaculture
commodities are unique because they require continued feeding and care, and they continue to grow and may ultimately exceed the size range that is preferred by buyers. As a result, that inventory would likely be sold at reduced prices as animals grew past their optimal market, thus incurring sales losses. In addition, many aquaculture producers cannot begin raising new fish while stil maintaining the fish intended to be sold prior to April 15, 2020, thus incurring additional marketing costs.
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Table A-4. Chronology of CFAP-1 Regulatory Amendments and Corrections
Coronavirus Food Assistance Program, Round One (CFAP-1)
Federal Regulation Citatio n
(85 Federal Register 30825, May 21, 2020) CFAP-1, Final Rule
Specifies CFAP-1 eligibility requirements, payment calculations, and application procedures.
Announces that USDA wil accept CFAP-1 applications starting on May 26, 2020, with a deadline of August 28, 2020 (later extended to September 11, 2020, by 85 Federal Register 49593, August 14, 2020).
Eligible non-specialty crops include malting barley, canola, corn, upland cotton, mil et, oats, sorghum, soybeans, sunflowers, durum wheat, and hard red spring wheat.
Eligible specialty crops include almonds, beans, broccoli, sweet corn, lemons, iceberg lettuce, spinach, squash, strawberries, and tomatoes.
Eligible livestock include dairy, cattle, lambs and yearlings, wool, and hogs and pigs.
Announces commodity-specific payment rates and total payment calculations. To comply with funding sources and authorities, USDA announces that payments for sales losses (i.e., lost income) and spoilage (while being marketed) are to be paid using CARES Act funds, while payments for unexpected marketing costs due to COVID-19 are to be paid using CCC funds.
Additional eligible commodities, such as aquaculture, nursery crops, and cut flowers to be announced in a subsequently Notice of Funding Availability (NOFA).
(85 Federal Register 31062, May 22, 2020) NOFA, CFAP-1 Additional Commodities Request for Information
USDA requests more information from stakeholders on potential additional commodities to be eligible for CFAP-1 payments—to be submitted via the comment facility at the federal rulemaking portal.
(85 Federal Register 35799, June 12, 2020) CFAP-1, Correction
Correction of typo in table of CFAP-1 payment rates for the commodity carrots.
Corrections are made to definitions of several CFAP-1 program terms to add clarity.
(85 Federal Register 41321, July 10, 2020) NOFA, CFAP-1, Additional Eligible Commodities
Announces additional commodities eligible for CFAP-1 payments, including Alfalfa Sprouts, Anise, Arugula, Basil, Bean Sprouts, Beets, Blackberries, Brussels Sprouts, Celeriac (celery root), Chives, Cilantro, Coconuts, Col ard Greens, Dandelion Greens, Greens (others not listed separately), Guava, Kale Greens, Lettuce Boston, Lettuce Green Leaf, Lettuce Lol a Rossa, Lettuce Oak Leaf Green, Lettuce Oak Leaf Red, Lettuce Red Leaf, Marjoram, Mint, Mustard, Okra, Oregano, Parsnips, Passion Fruit, Peas Green, Pineapples, Pistachios, Radicchio, Rosemary, Sage, Savory, Sorrel, Sugarcane (table), Swiss Chard, Thyme, Turnip Tops Green.
(85 Federal Register 41328, July 10, 2020) CFAP-1, Correction
Expands eligibility for sales-loss payments to apples, blueberries, garlic, potatoes, raspberries, tangerines, and taro.
Removes peaches and rhubarb from eligibility for sales-loss payments.
Adds specificity to potato for sales-loss payments—it is separated into categories for fresh Russets, fresh other, processing, and seed potato.
Corrects errors in payment rates for marketing costs and spoilage of apples, artichokes, asparagus, blueberries, cantaloupes, cucumbers, garlic, kiwifruit, mushrooms, papaya, peaches, potatoes (by category), raspberries, rhubarb, tangerines, and taro.
(85 Federal Register 49589, August 14, 2020) NOFA, CFAP-1, Additional Eligible Commodities
Announces additional eligible specialty crops including Aloe Leaves, Bananas, Batatas, Bok Choy, Carambola (Star Fruit), Cherimoya, Chervil (French parsley), Citron, Curry Leaves, Daikon, Dates, Dil , Donqua (Winter Melon), Dragon Fruit (Red Pitaya), Endive, Escarole, Filberts, Frisee, Horseradish, Kohlrabi, Kumquats, Leeks, Mamey Sapote, Maple Sap (for Maple Syrup), Mesculin Mix, Microgreens, Nectarines, Parsley, Persimmons, Plantains, Pomegranates, Pummelos, Pumpkins, Rutabagas, Shal ots, Tangelos, Turnips (Celeriac), Turmeric, Upland and Winter Cress, Water Cress, Yautia (Malanga), and Yuca (Cassava).
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Federal Regulation Citatio n
Announces additional eligible livestock and payment rate for al other sheep (i.e., al sheep greater than 2 years of age). Al other sheep payments to be determined according to the formula for lamb and yearlings (Table 2).
Announces payment eligibility for aquaculture, including catfish, largemouth bass and carp sold live as food (i.e., not for breeding), hybrid striped bass, red drum, salmon, sturgeon, tilapia, trout, ornamental or tropical fish, and recreational sportfish. Announces payment formula as described in Table 2.
Announces payment eligibility for liquid eggs, frozen eggs, nursery crops, and cut flowers.
(85 Federal Register 49593, August 14, 2020) CFAP-1, Correction
Extends CFAP-1 application deadline until September 11, 2020.
Extends CFAP-1 payment for sales losses (CARES Act funds) to green onions, walnuts, and watermelons.
Corrects CFAP-1 payment for marketing costs (CCC funds) and spoilage (CARES Act funds) for green onions, walnuts, and watermelons.
(85 Federal Register 59174, September 21, 2020) CFAP-1, Correction
Clarifies meaning of “produced in the United States” as it relates to imported livestock.
Specifies that al barley—not just malting barley—is eligible for CFAP-1 payments.
Source: U.S. Federal Register (as cited in table); USDA, CFAP-1, web portal, at https://www.farmers.gov/cfap1. Note: CFAP-1 = Coronavirus Food Assistance Program, First Round.
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USDA’s Coronavirus Food Assistance Program: Round One (CFAP-1)
Table A-5. Additional USDA Forms for CFAP Eligibility
Form
Purpose
CCC-901
Member Information
CCC-901 identifies members of a farm or ranch that is a legal entity. Member Information wil be completed by legal entities and joint operations to col ect the fol owing: member names, addresses, and Tax Identification Numbers (TINs); and citizenship status. If any member of the legal entity is a foreign person, CCC-902 must be completed by the legal entity or joint operation.
CCC-902
Farm Operating Plan
For CFAP purposes only the fol owing fields on the CCC-902 form are required to be completed: names, addresses, and TINs; citizenship status; and contributions to the farming operation for foreign persons.
CCC-941
Average Adjusted Gross Income (AGI) Certification and Consent to Disclosure of Tax Information
CCC-941 information is used to evaluate whether a producer is in compliance with AGI criteria.
CCC-942
Certification of Income from Farming, Ranching and Forestry Operations
CCC-942 must be completed if a producer exceeds the AGI criteria of $900,000, but derives at least 75% of income from farming activities.
AD-1026
Highly Erodible Land Conservation (HELC) and Wetland Conservation (WC) Certification
AD-1026 certifies compliance with required conservation provisions.
AD-2047
Customer Data Worksheet Request for Business Partner Record Change
AD-2047 provides basic customer contact information.
SF-3881
ACH Vendor/Miscellaneous Payment Enrollment Form (Direct Deposit)
SF-3881 col ects a producer’s banking information to al ow USDA to make payments to via direct deposit.
Source: USDA, Coronavirus Food Assistance Program, web portal, at https://www.farmers.gov/cfap. Notes: For producers that are existing FSA program participants, most of these forms are likely already on file at their local FSA Service Centers. In addition to these forms, if requested by USDA, an applicant must provide documentation that verifies the quantities of production and/or inventory used in the application, and that establishes the applicant’s ownership share and value at risk for the commodity.
Author Information
Randy Schnepf
Specialist in Agricultural Policy
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USDA’s Coronavirus Food Assistance Program: Round One (CFAP-1)
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