Senate Republicans unveiled a coronavirus relief package Monday that would give the Agriculture Department broad authority to spend an additional $20 billion to compensate agricultural producers and processors for the impact of the pandemic.
The money would augment the $14 billion that USDA now has available to spend in its Commodity Credit Corp. account as a result of the CARES Act, enacted in March.
Another key provision in the legislation, known as the HEALS Act, which is actually a combination of individual measures, would essentially forgive all Paycheck Protection Program loans under $150,000 without farmers and other borrowers having to prove that they spent the proceeds on allowable expenses.
As GOP senators had made clear in recent days, the legislation would put few strings on USDA when it comes to spending the $20 billion earmarked in the bill for farm relief.
The bill says the money can be used “to prevent, prepare for, and respond to coronavirus by providing support for agricultural producers, growers, and processors impacted by coronavirus, including producers, growers, and processors of specialty crops, non-specialty crops, dairy, livestock and poultry, including livestock and poultry depopulated due to insufficient processing access and growers who produce livestock or poultry under a contract for another entity.”
House Agriculture Committee Chairman Collin Peterson, D-Minn., has said he will demand more restrictions on how USDA allocates the payments.
The House-passed HEROES Act authorized $33 billion in farm relief, including $16 billion specifically for a second round of payments under the Coronavirus Food Assistance Program. The bill also specifically mandated relief to ethanol producers as well as indemnities for pork and poultry producers whose animals were euthanized.
The Senate bill doesn’t expressly mention the biofuel industry, but an aide to the chairman of the Agriculture Appropriations Subcommittee, John Hoeven of North Dakota, said the inclusion of processors as eligible recipients would allow USDA make payments to ethanol producers.
The top Democrat on the Senate Agriculture Committee, Debbie Stabenow of Michigan, declined comment when asked by Agri-Pulse whether the $20 billion would be sufficient.
Hoeven said the $20 billion "will help to mitigate the impacts of COVID-19 on farm country. Between the new direct funding and the CCC commitment, USDA will provide $34 billion to producers."
The bill allocates an additional $457 million to USDA to address other issues, including $245 million to make up for lost user fees due to the decline in agriculture inspection services and $113 million in rural rental assistance to low-wage residents.
The Farm Service Agency would get an additional $76.4 million to cover temporary staff and overtime costs.
Other provisions in the Senate GOP plan would ease rules for the Paycheck Protection Program loans as well as providing the automatic forgiveness for loans of under $150,000. The bill also would allow for a second round of the forgivable loans to businesses such as restaurants that have lost at least half their revenue.
For farmers who have taken out PPP loans, there would be a specific local calculation based on Schedule F agriculture income.
All PPP borrowers, including farmers, would also be allowed to select any eight-week period during 2020 to use the forgivable loan proceeds. That provision would benefit farms whose highest payroll periods were during the fall or at another time that isn’t allowed under the current restrictions.
Forgivable PPP loan expenses would be expanded to include the cost of worker protections among other costs.
Todd Van Hoose, president and CEO of the Farm Credit Council, said Monday that the GOP legislation was "a real beneficial bill for agriculture."
Senate Majority Leader Mitch McConnell, R-Ky., (pictured above) challenged Democrats to begin negotiations on the plan. Democrats have attacked Republicans for not releasing their proposal sooner. Authority for a $600-a-week federal unemployment benefit expires this Friday. The GOP bill would cut the benefit to $200 a week.
Missing from the Senate GOP bill was an expansion of the Soil Health and Income Protection Program, which was authorized as a 50,000-acre pilot program under the 2018 farm bill. The HEROES Act would expand the set-aside program to 5 million acres and offer farmers an annual payment of $70 an acre to enroll land in SHIPP for three years.
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Also missing was a 15% increase in Supplemental Nutrition Assistance Program that Democrats and anti-hunger groups are demanding.
The "HEALS Act is an unconscionable failure in our federal response to the COVID-19 hunger crisis," according to a joint statement by the Alliance to End Hunger, Bread for the World, Center on Budget and Policy Priorities, Feeding America, Food Research and Action Center, MAZON: A Jewish Response to Hunger, and Share our Strength.
"SNAP benefits are one of the fastest, most effective forms of economic stimulus, and increasing SNAP benefits helps families afford adequate, nutritious food. Congress must strengthen SNAP benefits in the final COVID-19 package to address food hardship and support economic recovery."
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