USDA CFAP 2 PAYMENTS
Second Round of CFAP Payments:
On Friday, September 18, USDA released the details of a second round of COVID assistance relief through the Coronavirus Food Assistance Program (CFAP), “CFAP 2”. A few things to note about the rule:
USDA identifies CFAP 1 and CFAP 2 as separate programs. USDA’s first CFAP program was designed to address disruptions that had occurred by April 15, 2020. CFAP 2 payments are intended to address the disruptions that have occurred since then. As a result, CFAP 1 payments will not impact how CFAP 2 payments are calculated, and two separate payment limits will be in effect.
CFAP 2 payments will be available for price-trigger commodities (including beef cattle, lambs, and sheep) that saw a 5-percent price decline over the period. For price-triggered livestock, payments will be based on a fixed number of head. This is defined as the lower of the maximum owned inventory of eligible livestock, excluding breeding stock, on a date selected by the eligible producer from April 16, 2020, through August 31, 2020.
Commodities not eligible for CFAP 2 include: Hay, except for alfalfa, crops intended for grazing, and animals raised for breeding stock. Breeding stock is typically kept for many years and therefore their value is less likely to be impacted by temporary price impacts.
Signups will begin September 21st and end December 11th.
The CFAP 2 payment rate for eligible beef cattle is $55 per head, and $27 per head of eligible lambs and sheep under 2 years of age. Payments will be based on the maximum owned inventory of eligible livestock, excluding breeding stock, on a date selected by the producer, between Apr. 16, 2020, and Aug. 31, 2020.
There is a payment limitation of $250,000 per person or entity for all commodities combined. Applicants who are corporations, limited liability companies, limited partnerships may qualify for additional payment limits when members actively provide personal labor or personal management for the farming operation. In addition, this special payment limitation provision has been expanded to include trusts and estates for both CFAP 1 and 2. Producers will also have to certify they meet the Adjusted Gross Income limitation of $900,000 unless at least 75 percent or more of their income is derived from farming, ranching or forestry-related activities. Producers must also be in compliance with Highly Erodible Land and Wetland Conservation provisions.
More details are available on the USDA’s CFAP website: https://www.farmers.gov/cfap/livestock.
USDA’s Farm Service Agency will be hosting a producer education webinar on the second round of CFAP funding on Thursday, Sept. 24, at 3 p.m. eastern time.
Click here to register for the webinar.