Producers benefit from funding packages
A $900 billion COVID-19 relief bill and $1.4 trillion government funding package was passed after a 359-53 vote in the House and a 92-6 vote in the Senate and was signed into law by President Trump on Dec. 27. National Cattlemen’s Beef Association’s (NCBA) Vice President of Government Affairs Ethan Lane and Senior Executive Director of Government Affairs Danielle Beck explain the benefits of the coronavirus relief bill along with the omnibus spending bill in the latest episode of NCBA’s Beltway Beef podcast.
The coronavirus relief bill and the government spending bill are two different pieces of the deal, says Lane.
“The stimulus bill is targeted to give relief to those hurting from COVID-19, whether it is business or individuals, and the omnibus is the regular government spending bill,” Beck explains. “I think what is most exciting for people, producers especially, are the provisions in the COVID-19 relief package.”
The package provides $11 billion for the office of the Agriculture Secretary to prevent, prepare for and respond to the coronavirus pandemic by providing support to agricultural producers, she notes.
“Excitingly enough, there is additional funding for producers, specifically cattle producers, in this funding,” Beck adds.
Support for cattle producers
Lane shares there is additional funding provided through the COVID-19 relief package for Coronavirus Food Assistance Programs (CFAP), however, the funding does not come through as a CFAP 3.
“This is not a CFAP 3, nor does it function like CFAP funding. For all intents and purposes, this funding is like a CFAP 1, part three,” explains Beck.
“It is intended to provide assistance to those producers who were left out in the cold after the April 15 cutoff date, and there will be additional payments based on what producers have previously received through the April 16 to May 14 window,” she continues.
The first round of CFAP came about in the original Coronavirus Aid, Relief and Economic Security (CARES) Act and incurred loss payments from Jan. 15 to April 15, says Lane.
Beck shares the second round of CFAP made inventory payments to producers, and this third round of CFAP is for producers who incurred losses, but were not made whole by the inventory payment rate.
“This is the targeted relief NCBA has been asking for since the CARES Act was enacted,” shares Beck.
“In previous rounds of CFAP funding, Congress left it open for the U.S. Department of Agriculture (USDA) to figure out, but this round has very specific language and formulas,” adds Lane.
Beck shares questions of what this program looks like and how payments will be made are soon to be answered, as USDA staff are returning from holiday breaks and have many programs authorized through the packaged bills to sort through.
Other programs included
The Ramp Up Act, as well as tax information for the Paycheck Protection Program (PPP) were also included in the packages passed.
“The Ramp Up Act provides $60 million in grants for meat and poultry processing facilities across the U.S. to allow for interstate shipping. Any existing state-inspected facility or custom-exempt facility wanting to become part of the federal inspection system and be able to sell their product across state lines will be able to apply for these grants through USDA,” says Beck.
She adds this program is important to producers when it comes to increasing competition in the packing sector, allowing more market access and a place for custom products in the market, hopefully resulting in a lot of good for the agriculture and processing industries. The bill also includes two provisions requiring USDA to work with states to improve existing Cooperative Interstate Shipment Programs.
“This bill includes an additional $284 billion in a second round of PPP loans and simplifies the forgiveness process for any loans under $150,000. More importantly, the bill specifies forgiven PPP loans are not to be included in taxable income,” Beck states.
An Internal Revenue Service (IRS) rule previously required income from PPP loans to be taxable. Beck and Lane both agree this legislative language is critical in allowing small businesses, including small agricultural businesses, to stay above water while recovering from the pandemic.
“In addition, the bill clarifies deductions are allowed for expenses paid with proceeds of forgiven PPP loans and subsequent PPP loans,” shares Beck. “Hopefully, producers who took advantage of the PPP will see additional benefits from non-taxation.”
Averi Hales is the editor of the Wyoming Livestock Roundup. Send comments on this article to firstname.lastname@example.org.