It’s not everything that farm groups wanted, but the broad array of agricultural provisions in a $3 trillion coronavirus relief bill that the House is expected to vote on Friday are likely to find many supporters in the Senate.
The HEROES Act, as the 1,815-page House bill is called, lacks a proposal backed by the American Farm Bureau Federation to raise USDA’s Commodity Credit Corp. spending authority from $30 billion to $68 billion.
But the legislation does authorize $16.5 billion in additional direct payments, building off of rules for $16 billion in payments that the department is expected to release later this month or in June under the Coronavirus Food Assistance Program (CFAP). Recipients of those payments will include fruit and vegetable growers who have been hammered by the loss of sales following the closure of restaurants, schools and universities and the slowdown in other food service business.
“The food and agriculture value chain has been strained to the breaking point by this pandemic and thousands of producers across the country are facing catastrophic losses through no fault of their own. This is particularly true for livestock, dairy and specialty crop producers and the provisions in the HEROES Act will help provide a lifeline to them in this time of dire need," said Chuck Conner, president of the National Council of Farmer Cooperatives.
The bill would compensate producers who have to dispose of livestock and poultry that can’t be sold because of processing disruptions. That’s a top priority for the National Pork Producers Council.
"U.S. pork producers are facing an unprecedented financial and animal welfare crisis," said NPPC President Howard "A.V." Roth. "These provisions represent a critical lifeline for hog farmers struggling to weather this storm.”
And the bill also would provide special assistance targeted toward dairy producers, including additional sweeteners for the Dairy Margin Coverage program, and aid directed to biofuel plants, fruit and vegetable growers and local agriculture.
The bill would provide $100 million in Specialty Crop Block Grants to states to address supply chain issues. For the dairy industry, the bill would authorize a program for donating dairy products to feeding programs. Milk used for donated products would be reimbursed at fluid milk prices. The bill also would authorize a recourse loan program to help dairy processors, wholesalers and others manage their marketing.
Biofuel plants would be eligible for payments of 45 cents a gallon for fuel produced from Jan. 1 to May 1. For plants that were unable to produce for a month or more, they could get payments of 45 cents on half their production during the corresponding period in 2019.
Growth Energy CEO Emily Skor said the bill “offers a sorely needed beacon of hope for biofuel workers, our farm partners, and thousands of rural communities struggling to stay afloat.”
The bill’s instructions for dispensing the $16.5 billion in direct payments reflect House Agriculture Chairman Collin Peterson’s insistence on restricting Agriculture Secretary Sonny Perdue’s spending authority and a desire on the part of Democrats to address groups of producers that feel they are being shortchanged by CFAP. Perdue used USDA’s CCC spending authority to develop the CFAP payments as well as the 2018 and 2019 Market Facilitation Program payments that were intended to offset the damage caused by the trade war with China.
Under the House bill, recipients of the upcoming CFAP payments would get additional payments to cover 85% of their losses in the second quarter of the year. Producers who aren’t eligible for CFAP payments could get payments under the House bill for 85% of their losses for the first half of 2020.
USDA also is directed to account for price differences among commodities based on location, specialized varieties and farming practices, including commodities that are certified organic.
The $68 billion limit in CCC authority that AFBF is supporting is the level the cap would be if the $30 billion cap originally set in the 1980s had been adjusted for inflation. "We're asking for that $68 billion. ... if we can get $50 (billion) it would be a win for the farmers and for the USDA," AFBF President Zippy Duvall told reporters recently. It's too soon to know how much relief farmers will ultimately need, he said.
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Senate Minority Leader Chuck Schumer, D-N.Y., quickly signaled support for the bill. Senate Republicans should “heed the lessons of U.S. history and not repeat the mistakes made by President Hoover that helped lead to the Great Depression,” he said.
But many of the bill’s far more expensive provisions will be difficult if not impossible for Republicans to swallow, and Senate Majority Leader Mitch McConnell, R-Ky., insisted again Tuesday that it was too soon to pass another massive aid bill.
“We’ve taken a look at what we’ve already done. We’ve added about $3 trillion to the national debt and assessing the effectiveness of that before we go forward,” McConnell said. “We’re having discussions … with the administration. If we reach a decision, along with the administration, to move to another phase, that will be the time to interact with the Democrats.”
The House bill would authorize a new round of stimulus checks worth $1,200 to individuals and up to $6,000 to families and $875 billion in fiscal relief to states and local governments. Other Democratic priorities in the legislation include a $10 billion increase for the Supplemental Nutrition Assistance Program, $3 billion in additional funding to provide emergency financial relief to school meal providers and USDA’s Child and Adult Care Food Program, aid to pension funds, an elimination of the cap on deductions of state and local taxes, and an extension of expanded unemployment benefits.