USDA is launching a second round of COVID-19 relief payments
The USDA has launched an expansion of the Coronavirus Food Assistance Program (CFAP), CFAP 2, like the first round, this program is designed to provide farmers with approved application financial aid.
CFAP – 2
CFAP -2 will provide $13.21 billion in aid to farmers over the next few months. USDA plans to distribute CFAP-2 payments this fall to farmers to partially compensate for losses experienced from April 1, 2020 – August 31, 2020 (or from April 16th for livestock) where prices, markets, and supply chains have been impacted by the COVID-19 pandemic. Unlike CFAP-1, a commodity need not have experienced at least a 5% decline in price to be eligible for a payment.
Though CFAP-2 is a separate program, it retains most of the elements of CFAP-1 that closed on September 11, 2020. However, CFAP-2 also includes significant improvements that are certain to benefit many farmers who weren’t eligible for or compensated fairly by the original program. The key revisions in CFAP-2 include:
- an additional round of price loss based payments for commodity crops covered under CFAP-1
- a new fixed $15/acre payment for many grain, oilseed, and hemp crops that were not previously eligible
- and a modest, revenue based payment program for specialty crop and other producers that greatly expands eligibility to include nearly all crops and many types of livestock. Funding for CFAP-2 is from existing Commodity Credit Corporation (CCC) funds and does not require Congressional approval to implement.
The application window for CFAP-2 is from September 21, 2020 – December 11, 2020 and checks are expected to be mailed to farmers within a week or two of approved application.
USDA’s Farm Service Agency (FSA) will be responsible for issuing checks to farmers.
Nearly all crops and many types of livestock may be eligible for payment under CFAP-2 but unlike CFAP-1, different commodities are eligible for very different types of payments. Farmers may be eligible for up to three different types of payments under the new CFAP-2 program depending on what they grow and market.
Farmers can receive payments for:
- Commodity crops, livestock, poultry, and dairy with a minimum 5% price decline over a specified time period with payments based on national wholesale prices, similar to the CFAP-1 program (referred to as price trigger commodities);
- Minor commodity crops for which there is limited pricing data that will receive a $15/acre flat rate payment (referred to as flat-rate crops) (new); and
- Other commodities that are not included in either of the previous two categories will receive payments based on a producer’s revenue from a previous marketing year (referred to as sales commodities) (new).
USDA has created a helpful tool Eligible Commodities Finder to help understand the payment rates offered with CFAP-2. Some of the commodities include:
- Row Crops
- Specialty Crops
- Broilers and Eggs
- Floiculture and Nursery Crops
Just because you make the list does not necessarily qualify you to receive aid if you have been impacted by the virus. Benefits of the program are based on a producers scale, eligible crops, and price losses. For instance, to be eligible for a payment, a commodity must have experienced at least a 5 percent decline in price since January.
Who is Eligible?
Most farmers are eligible for this program; however there are still some producers and crops that are still ineligible for payments (see the commodity finder above).
To be eligible for a payment, a producer must:
- Complete a CFAP application form and provide any required documentation within 60 days of signing their application
- Be a producer having a share in the eligible commodity between January 15 – April 15, 2020, or April 16 – May 14, 2020
- Be either a:
- U.S. Citizen
- Resident Alien providing land, capital, and active personal labor in the farming operation
- Partnership of U.S. Citizens
- Corporation, Limited Liability Company, or other organization recognized under State law
- Indian Tribe or Tribal Organization
- Foreign Person providing land, capital, and active personal labor in the farming operation
- Foreign Entity that has more than 10 percent of its beneficial interest held by individuals that are not US Citizens or Lawful Aliens
Federal, state, and local governments are prohibited from participating in CFAP. An individual or entity with an average adjusted gross income (AGI) of more than $900,000 – based on the average gross incomes for 2016, 2017, and 2018 tax years – is also ineligible unless they derive at least 75 percent of their income from farming, ranching, or forestry related activities, in which case there is no AGI restriction. There is no AGI limit for joint ventures or general partnerships. This AGI threshold is significantly less strict than in previous USDA support payment programs.
How do farmers apply?
Producers can apply for assistance beginning September 21, 2020. Applications will be accepted through December 11, 2020. Application materials are available at farmers.gov/cfap/apply. Farmers who applied for CFAP-1 will likely already have many required forms on file with FSA. Farmers should check with their FSA county offices to see if any forms need to be updated.
USDA recommends that farmers new to FSA or CFAP first call the CFAP hotline, (877) 508-8364, for one on one support before contacting their county office.
Farmers will have several options in applying for CFAP-2, including applying online or in person at their local FSA county office. The CFAP Application Portal and Application Generator and Payment Calculator are now available online.
To find your local FSA office and to check the status of your local USDA Service Center, click here.
Required forms are similar to CFAP-1:
- CCC 902 – Farm Operating Plan
- CCC 901 – Member Information
- CCC 941 – Adjusted Gross Income
- CCC 942 – Income from Farming
- AD 1026 – Conservation Compliance
- AD 2047 – Customer Information
- SF 3881 – Direct Deposit Information
- FSA 578 – Report of Acreage (price trigger, flat rate only) (new)
While technically producers can submit their applications anytime before September 11, funding is likely to go quickly – especially with the increased per farm payment limitations. Farmers who think they could benefit should apply as soon as possible.
*Farmers who have already participated in any FSA or NRCS program or registered their farm with FSA will likely already have completed most of these forms.
To download fillable PDFs of any of these required forms, click here.
At this time, it is uncertain whether or not USDA will require a farm number. None of the forms listed above require this information, however USDA has stated that a farm number may not be needed immediately. For farmers who don’t have a farm number, and are interested in obtaining one, contact your local FSA office to do so.
- All USDA forms and information: https://www.farmers.gov/cfap
- NSAC’s detailed blog post that helped fuel this webpage https://sustainableagriculture.net/blog/covid-cfap-signup/
- NSAC 101 for producers
- A USDA Farm Service Agency CFAP Call Center is available for producers who would like additional one-on-one support with the CFAP application process: 877-508-8364
- Farm Aid hotline: 1-800-327-6243
- ATTRA hotline: 800-346-9140 (English), 800-411-3222 (Español)
FLAG legal services hotline: 877-860-4349