In the CARES Act that was unveiled several weeks ago, there was a separate section that allotted close to $50 billion to the agricultural community. However, at the time of the issuance of the Act, there was relatively little information to how these funds were to be disbursed. That was until Friday, April 17, 2020.
On Friday afternoon, President Trump announced a $19 billion dollar bailout for farmers
whose businesses were hurt financially by the coronavirus crisis. The aid plan includes $16 billion in direct payments to farmers to boost their incomes, along with $3 billion in government purchases of meat, dairy products and other foods. The Agriculture Department will receive another $14 billion in July for further assistance.
Distribution of Funds
Although, the terms of how ultimately the funds will be disbursed is not finalized at this moment, it is GHJ’s understanding that the payments will be limited to $125,000 per commodity and $250,000 per individual or entity who has been effected. The funds will be calculated as the combination of 85 percent of price losses from Jan. 1 to April 15, 2020, and 30 percent of expected losses for the next two quarters after April 15.
The USDA is expediting the rule-making process for a direct-payment program and expects to begin sign-up for the new program in early May and to get payments out to producers by the end of May or early June.
Based on how quickly the $350 billion allocated to PPP funds were used up, it can only be expected that there will be a similar run on the funds appropriated to this agricultural bailout.
More information will be forthcoming as to specific disbursement from this bailout for various agriculture segments.
We encourage you to reach out to our COVID-19 Resource Team if you have any questions specific to your organization.