The Coronavirus Aid, Relief, and Economic Security (CARES) Act became law on March 27, 2020. The $2 trillion relief package includes various provisions to help small businesses and agriculture.
Small Business Assistance
The U.S. Senate Committee on Small Business & Entrepreneurship, the Small Business Administration (SBA), and the Small Business Development Center (SBDC) provide guidance on CARES Act programs for small businesses. The Paycheck Protection Program (PPP) is a new program that makes low-interest loans available to employers with less than 500 employees. It also is available to sole proprietors and eligible self-employed individuals. The loan will be fully forgiven if at least 75% of the funds are used for payroll expenses and employees are maintained or quickly rehired. Loan funds may also be used for rent, mortgage, or utilities. PPP loans are administered by the SBA, but businesses must apply through their local bank.
Other assistance programs for small businesses include the Economic Injury Disaster Loan (EIDL) Program, Express Bridge Loans, and the SBA Debt Relief Program. Initially farms were deemed not eligible for the EIDL program (except for agricultural cooperatives, aquaculture enterprises, nurseries, and farm-dependent businesses), and the program closed to applications on April 15th. Since then, the EIDL Program has been reopened specifically to accept applications from agricultural businesses. The program will provide a loan advance up to $10,000 for eligible agribusinesses experiencing temporary revenue losses. The loan advance does not have to be repaid. EIDL applications can be submitted online through the SBA website.
The CARES Act also contains provisions for employee rights, requiring employers to provide paid sick leave and expanded family and medical leave for COVID-19 related reasons. The Act offers eligible employers an employee retention tax credit.
Assistance for Agriculture and Rural Communities
The CARES Act provides $14 billion for the Commodity Credit Corporation (CCC), a government entity that administers commodity price support programs, conservation programs, the Market Facilitation Program, and other agricultural assistance programs. The Act also includes $9.5 billion to support “producers of specialty crops, producers that supply local food systems, including farmers markets, restaurants, and schools, and livestock producers, including dairy producers.” The CARES Act also provides additional funding for nutrition assistance and rural health and development programs. USDA now provides a Federal Rural Resource Guide and a Summary of Actions Taken by USDA-Rural Development to assist rural communities affected by COVID-19. The B&I CARES Act Program offers loan guarantees to lenders for commercial loans. The loans must be used for operating expenses by agricultural producers and rural businesses to cover cash flow shortfalls associated with the coronavirus pandemic.
Through the Farmers to Families Food Box Program, the USDA is contracting with food distributors to deliver household-size boxes of food to food banks and other nonprofits. The first round of contracts was awarded in May. A second round of contracts may be offered this summer.
The Coronavirus Food Assistance Program (CFAP) will accept applications May 26 through August 28, 2020. Farm payment rates (dollars per pound) were established by USDA for eligible commodities that experienced price declines or market losses. This program will pay agricultural producers who produced those commodities between January 15 and April 15, 2020. Eligible commodities are listed on the CFAP website. Producers can apply through their local USDA Farm Service Agency office.
0
