What We Know About USDA’s COVID-19 Aid Package
April 13, 2020
President Donald Trump several times over the past week has indicated some $16 billion of COVID-19 farmer aid would be announced soon. Additionally, Pro Farmer’s Jim Wiesemeyer says there is funding available through the Section 32 program and other revenue sources, including language in previous COVID-19 aid legislation that allows the USDA secretary to tap the U.S. Treasury, if it is deemed there could be a food shortage.
What’s the timing? According to Wiesemeyer, USDA Secretary Sonny Perdue will likely send a proposal to the Office of Management and Budget (OMB) sometime the week of April 13, with some sources pinpointing a Wednesday dateline of April 15. “It is unclear how long it will take OMB and others to sign off on the coming USDA proposal, but a fast turnaround is possible,” he says. “That is why an official announcement of the package could be late the week of April 13 at the earliest, or the week of April 20.”
How big will the package be? The size of the coming package may be less than the $23.5 billion that Congress approved and President Trump signed into law, relative to Phase 3 of the COVID-19 rescue package, Wiesemeyer says.
“The coming plan looks to consist of $9.5 billion of targeted funds but not exclusively for livestock, dairy and specialty crops,” he adds. “The remainder of around $6 billion would come from the Commodity Credit Corporation (CCC), even though Congress authorized an increase of $14 billion in CCC borrowing authority, and this would likely mostly be targeted to row-crop producers.”
USDA Secretary Sonny Perdue and Sen. John Hoeven (R-N.D.) pushed for an additional $20 billion in CCC borrowing authority via the debate on the Phase 3 relief legislation, but Democratic lawmakers reduced that increase to $14 billion, Wiesemeyer notes. Still, there are other avenues of funding USDA can tap, including Section 32 and the U.S. Treasury, among perhaps other revenue sources, contacts advise.
Perdue has indicated that the additional CCC funding will not be available until at least July, due to legislative language regarding a June 2020 CCC audit.
“Agricultural bankers, farmers and others say that even though the $14 billion will not be available until July at the earliest, Perdue should nonetheless announce all the eventual funding from the CCC for row crops when he makes the initial COVID-19 announcement, Wiesemeyer says. “But that may not be the case, at least based on information at this time.”
Details on how the funding will be allocated are unknown at this time.