New Coronavirus Food Assistance Program (CFAP): Info for Producers

There will be a new round of Coronavirus Food Assistance Program (CFAP) payments, but it will look different from CFAP 1 & 2. For dairy, certain producers would be eligible for increased payments under the Dairy Margin Coverage (DMC) program, with some allowance for increasing coverage levels. There are some small formula modifications for specialty crop producers, but it is still unclear how Vermont producers will fare. There is also a small payment per head on beef. Please keep an eye out for more details and sign-up info from your FSA office.

Also, the bill provided an additional $400 million for a dairy donation program, plus an additional $1.5 billion to allow USDA to purchase food products and donate it to food banks (the Farmers to Families program).

There were some positive changes to the Paycheck Protection Program (PPP). Farmers who did not get a first PPP can apply, and there is an improved formula that uses gross rather than net income (especially good for sole proprietors). If you already received a PPP, you can also recalculate your loan amount based on the new formula. And if you already received a PPP, you can apply for a “Second Draw” loan, but you must show a 25% revenue reduction from a period in 2019 to 2020. There were other big improvements as well: loan forgiveness has been simplified, and you can now deduct expenses covered by PPP on your taxes. Please contact your lender for more details – the program opened on January 11. This summary is also helpful if you want more details.

A few changes on SBA’s EIDL program:

·       Businesses in designated low-income communities that received an EIDL loan can get a grant equal to the difference of what they received and $10,000. You can search your address in the map here. 

·       Eligible Businesses in low-income communities that did not get EIDL loans/Advance grants because funds had run out can now get $10,000.

·       Also, if you previously received both an EIDL Advance grant and a PPP loan, you had to deduct the advance from your PPP forgiveness amount. You now no longer have to deduct that amount from forgiveness.

·       More details forthcoming from SBA on when this will go into effect.

For farmers or staff who lost work due to coronavirus impacts, pandemic unemployment assistance (PUA) was extended for an additional 11 weeks (until benefit week-ending March 13), with 11 weeks of an additional $300/week payment. 

A few other funding updates:

Notice for USDA Rural Development’s (RD) Value Added Producer Grant (VAPG) is now open for businesses to apply. Vermont businesses did very well in the last year – Ten awards were granted averaging $200,000 each. Applications will be accepted through March 22, 2021. Information on the program and application materials are available on the VAPG page of RD’s website. For more information on the VAPG program, contact Elijah Massey at the Vermont office: elijah.massey@usda.gov.

The federally-funded Specialty Crop Block Grant program, administered by the Vermont Agency of Agriculture, is also now open. Details can be found here.