FARGO, N.D. — The federal response to COVID-19 relief for agriculture comes against the backdrop of already existing pain in farm and ranch country.
U.S. Sen. John Hoeven, R-N.D., announced April 2 that he will hold a video conference at 1 p.m., April 3, with North Dakota farm, commodity and agribusiness leaders, to advise on how the $25 billion “agricultural piece” will work in the $2 trillion bill known as the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act.
Separately, Rep. Collin Peterson, D-Minn., chairman of the House Agriculture Committee, in a telephone news conference with reporters, said he is unclear on whether Small Business Administration loans can be rolled out as quickly as Secretary of the Treasury Steve Mnuchin thinks they will.
Peterson said he and others are working on an anomaly that prevents farmers from being included in an Economic Injury Disaster Loan program, as modified by the CARES Act.
Peterson said he’s been getting “lots of calls” from farmers worried about the upcoming cropping season, and cattle, turkey and hog producers are worried about markets.
He said he and Secretary of Agriculture Sonny Perdue and others are concerned about abnormal differences between futures and cash price, and that he and Perdue are writing to the Department of Justice asking for investigations into potential price-fixing.
Peterson said he is talking with Perdue on whether adjustments can be made to the dairy programs without opening up the multi-year farm bill. Peterson said one problem with the programs is that farmers see them as “a government program” they should participate in only if a projected payment is likely.
”People don’t decide not to pay for house insurance because you somehow figured it was not going to burn down,” he said. He said it’s a “no-brainer” to buy insurance to cover up to $9.50 per hundredweight of milk on 5 million pounds of production.
‘Food chain’ strains
Hoeven, speaking at a March 30 news conference with North Dakota Gov. Doug Burgum in Bismarck, and also laid out his interpretation of the federal help. He said Congress is working to make sure USDA can keep the “food chain going,” Hoeven said.
About $9.5 billion of the CARES Act was added as “emergency funding,” as well as $14 billion to replenish the Commodity Credit Corp. That’s $23.5 billion available to farmers and ranchers to assist them into this period,
“What we have in the legislation is the funding and the authorization to provide help through the Department of Agriculture,” Hoeven said. “Now we have to design or develop the program with USDA.”
Hoeven said the roundtable on Friday “will give input to USDA as to how we will put that program together so that it’s fair, certainly so it helps livestock producers who have been left behind on this. They’ve got some market promotional funds but really haven’t gotten the assistance that our other producers have.”
Small business aid is “very important,” because it’s not loans, but is “really a grant program.” It works through the banks and all of the financial institutions — banks, credit unions — administered by the Small Business Administration. The SBA was hoping to be able to provide loans starting April 3, with “a lot of points of entry,” through the many institutions, so no government agency is “overwhelmed.”
Businesses can borrow up to 2.5 times their average monthly annual payroll, Hoeven said. “To the extent that loan is used on qualified expenses, it’s forgiven,” Hoeven said. “You don’t have to pay that back. When you keep those employees on the payroll, that expense is forgiven.”
That keeps the businesses together and gets them up and running, Hoeven said.
For people who are laid off, the federal government is doing more with unemployment insurance. “We’re providing funding to make sure that unemployment insurance fund is there, along with increasing and extending a number of those benefits.” It’s extended to people who usually don’t qualify — self-employed and independent contractors.
The bill also provides:
$127 billion for hospitals and health care institutions.
$150 billion — Coronavirus Relief Fund North Dakota receives $1.25 billion, in addition to block grant money.
$8 billion for particular Native American help. This includes $1 billion for health services and $400 million for the Bureau of Indian Affairs for law enforcement, and more than $300 million for housing, over $300 million for Native American education assistance, tribal-owned and individually-owned businesses.