Mike Schrey, chief credit officer for AgChoice Farm Credit, reviews the Coronavirus Food Assistance Program (CFAB) and highlights the next steps Pennsylvania Farmers need to take to access the funding.
Mike Schrey, chief credit officer for AgChoice Farm Credit, reviews the Coronavirus Food Assistance Program (CFAB) and highlights the next steps Pennsylvania Farmers need to take to access the funding.
What Coronavirus Food Assistance Program Means for Farmers
We recently interviewed Mike Schrey, AgChoice Farm Credit’s chief credit officer. Mike reviewed the Coronavirus Food Assistance Program (CFAP) which provides up to $16 billion in direct payments to farmers who have experienced losses related to COVID-19. Listen to the full podcast episode with Mike here.
Help our listeners understand the basics of the CFAP. Who is eligible for the assistance and how does the program work?
As part of the CARES Act, the Coronavirus Food Assistance Program (CFAP) was developed. It provides two main components:
USDA announced the details related to CFAP direct support for farmers just last week and I will cover the highlights on each commodity next. However, it’s important to understand that the funding draws from two separate authorities - $9.5 billion from the CARES Act and $6.5 billion from the Commodity Credit Corporation. The dual authority makes it a bit confusing as it does cause separate payment rates for each commodity based on the underlying authority.
Commodities eligible for CFAP include livestock (cattle, hogs and sheep- lambs and yearlings only), wool, dairy, non-specialty crops which includes many row crops such as corn and soybeans, and specialty crops such as fruits, vegetables, nuts and mushrooms. CFAP payments are limited to $250,000 per person or legal entity, and each commodity has its own set of standards for how the direct payment is structured.
Let me share some examples of the calculations for a few commodity areas:
To ensure availability of funding throughout the application period, producers will receive 80% of their maximum total payment upon approval of the application. The remaining portion of the payment, not to exceed the payment limit, will be paid at a later date as funds remain available.
It’s clear that there are a lot of details related to CFAP that farmers need to understand. How can farmers learn more and what steps do they need to take to apply?
CFAP is administered through FSA. I encourage all farmers to review the CFAP website at www.farmers.gov/cfap for details on their specific commodities.
All farmers must apply for CFAP through their local FSA office, many of which are operating by appointment only right now. The application period officially opened this week on May 26 and will remain open through August 28.
To expedite the process, be prepared before you have your appointment with FSA. If you’ve worked with FSA before, many of the entity and general information forms should already be on file. If not, check out the farmers.gov website for the forms what will need to be collected. Consider all aspects of your operation and information you will need to submit. For instance, if you are a dairy farmer, in addition to having your settlement checks for January through March, gather your receipts for cull cows as well as inventories of grain not under contract and inventories of corn silage on hand as of January 15 which will be paid on grain conversion.
Are there any other thoughts you would like to share?
Some program details are still unclear and may change. Stay informed about any changes by reviewing the www.farmers.gov/cfap website and reading articles in farm publications. Submit an application with FSA as soon as you can. There is a limited amount of funds and when the funds are expended, there’s no guarantee they will be replenished. Apply early, and hopefully you will get your payment quickly to help cover lost income during COVID-19.