Coronavirus Food Assistance Program (CFAP) Livestock Payments
(5/21/20) The U.S. Department of Agriculture (USDA) Coronavirus Food Assistance Program (CFAP) provides payments for producer losses during COVID-19.
Livestock eligible for CFAP includes cattle, hogs, and sheep. CFAP assistance is available to livestock producers who have an ownership interest in eligible livestock that have suffered a five percent-or-greater price decline as a result of the COVID-19 pandemic and face additional significant costs in marketing their inventories due to unexpected surplus and disrupted markets.
A single payment for livestock will be calculated by adding:
- The producer’s number of livestock sold between January 15 and April 15, 2020, multiplied by the payment rates per head (CARES part 1 payment rate), plus
- The highest inventory number of livestock between April 16 and May 14, 2020, multiplied by the payment rate per head (CCC part 2 payment rate).
For example, a producer who sold 50 calves less than 600 pounds on April 1 and had an inventory of an additional 60 calves weighing less than 600 pounds on May 1 would be eligible for a payment of $7,080 calculated by ((50 X 102) + (60 X 33)).
Producer means a person or legal entity who shares in the risk of producing a crop or livestock and who is entitled to a share in the crop or livestock available for marketing or would have shared had the crop or livestock been produced and marketed. A contract grower who does not own the livestock, will be considered a producer if the contract allows the grower to have risk in the livestock.
Cattle means commercially raised or maintained bovine animals, excluding beefalo, bison, and animals used for dairy production or intended for dairy production.
- Production dairy cattle are not included in the definition of cattle and not eligible for a livestock payment. However, there is a separate dairy payment based on milk production.
Feeder cattle 600 pounds or more means cattle weighing more than 600 pounds but less than the weight of slaughter cattle-fed cattle as defined in this section.
Feeder cattle less than 600 pounds means cattle weighing less than 600 pounds.
- Light calves fit this definition, so a cow-calf pair in inventory is counted as two animals.
Slaughter Cattle—fed cattle means cattle with an average weight in excess of 1,400 pounds which yield average carcass weights in excess of 800 pounds and are intended for slaughter.
Slaughter cattle—mature cattle means culled cattle raised or maintained for breeding purposes, but which were removed from inventory and are intended for slaughter.
Cattle raised or maintained for breeding purposes means animals commercially raised or maintained for use as either a sire or dam for the production of livestock offspring or lactation.
All other cattle means commercially raised or maintained bovine animals not meeting the definition of another category of cattle in this part excluding beefalo, bison, and animals used for dairy production or intended for dairy production.
- Cows and bulls not for slaughter are “all other cattle.”
Lambs and yearlings means all sheep less than 2 years old.
Hogs means any swine 120 pounds or more.
Pigs means any swine weighing less than 120 pounds.
For dairy, a single payment will be made based on the sum of two calculations:
- The producer’s certification of milk production for the first quarter of the calendar year 2020 multiplied by $4.71 per hundred weight, plus
- Producer’s production in the first quarter multiplied by $1.47 per hundred weight.
CFAP payments are subject to a per person and legal entity payment limitation of $250,000. However, corporate entities with multiple shareholders are eligible for payments for up to three shareholders, not to exceed $750,000 total.
A person or legal entity, other than a joint venture or general partnership, is ineligible for payments if the person’s or legal entity’s average adjusted gross income (AGI) is more than $900,000, unless at least 75 percent of that AGI is derived from farming, ranching, or forestry-related activities.
How to Apply:
FSA will begin taking applications on Tuesday, May 26. At this point in time, USDA Service Centers are open for business by phone appointment only. FSA will be working with producers by phone and using email, fax, mail, and online tools to accept applications. You can find your local USDA service center here – https://offices.sc.egov.usda.gov/locator/app.
FSA Forms for New Customers:
Additionally, the following forms will be needed for CFAP. Existing FSA customers likely already have these on file at their local Service Center.
- CCC-901 (Also Available in Spanish) – Identifies members of a farm or ranch that is a legal entity. Member Information will be completed by legal entities and joint operations to collect the following:
- member names, addresses, and Tax Identification Numbers
- citizenship status
- CCC-941 (Also Available in Spanish) – Reports your average adjusted gross income for programs where income restrictions apply.
- CCC-942 – If applicable, this certification reports income from farming, ranching, and forestry, for those exceeding the adjusted gross income limitation.
- AD-1026 (Also Available in Spanish) – Ensures compliance with highly erodible land conservation and wetland conservation.
- AD-2047 – Provides basic customer contact information.
- SF-3881 – Collects your banking information to allow USDA to make payments to you via direct deposit.
USDA will make an initial payment of 80 percent of a producer’s eligible payment amount. If funds remain available after initial payments to eligible producers, USDA will disburse the remainder of the funds.
Officials have stated they aim for initial payments to be made within a week of enrollment.
Producers will need to collect sales, inventory, and other records to complete a CFAP application. However, CFAP is a self-certification program, so this documentation will not be required to be submitted with the application. USDA will perform spot checks and producers are required to provide supporting documentation upon request.
Examples of supporting inventory documentation include “evidence provided by the producer that is used to substantiate the amount of production or inventory reported, including copies of receipts, ledgers of income, income statements of deposit slips, veterinarian records, register tapes, invoices for custom harvesting, and records to verify production costs, contemporaneous measurements, truck scale tickets, or contemporaneous diaries that are determined acceptable by USDA.”
Documentation to support the application must be retained for three years.
If a producer error results in an erroneous payment, the producer is liable to pay back the excess payment plus interest. If USDA determines a producer misrepresented the total amount or producer’s share of livestock industry, all CFAP funds with interest must be returned. Willful misrepresentations are also subject to perjury laws and could result in fines, imprisonment of up to 5 years, or both.
The CFAP payments are being made from two pools of funds. The funds for livestock sold from January 15 to April 15 come from the $9.5 billion provided in the Coronavirus Aid, Relief, and Economic Stability Act (CARES Act; Pub. L. 116-136) to support for agricultural producers impacted by coronavirus.
The funds for inventory of livestock between April 15 and May 15 are coming from the existing Commodity Credit Corporation (CCC) account, in accordance with 15 U.S.C. 714b. At this time, the amount of CCC funds available for these purposes is limited to $6.5 billion.
It is possible there will be additional funds provided in a second phase of CFAP or other future programs. The CARES Act provides for a $14 billion replenishment of CCC’s borrowing authority in section 11002. These funds will not be available to CCC until after June 2020. Additionally, Congress is considering additional funds for producer payments in future COVID relief legislation.
Markets as Employers During COVID-19 — New Resources Available
(4/18/20) Families First Corona Virus Response Act (FFCRA) —Market Owner Reference Guide
Below is a downloadable flowchart that simplifies the determination if Emergency Family and Medical Leave is appropriate or if Emergency Paid Sick Leave applies to you as an employer. If you have questions after reviewing the guidance document, please reach out to LMA General Counsel, Jara Settles, at email@example.com
(4/10/20) LMA has created new COVID-19 guidance for markets as employers. This guidance is available HERE and addresses such challenging issues such as: what to do if an employee has a positive COVID-19 test result, what to do if an employee appears to be healthy, but has been exposed to COVID-19 and needs to continue coming to the market, and what leave is available to employees if they need to take time off due to COVID-19.
If you have questions after you’ve reviewed the guidance document, please reach out to LMA General Counsel, Jara Settles, at firstname.lastname@example.org.
Paycheck Protection Program Accepting Applications
On April 3, 2020, the Small Business Administration (SBA) launched the Paycheck Protection Program (PPP).
The program is designed to provide a direct incentive for small businesses to keep their workers on the payroll. Loans will be forgiven if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities. The PPP was created with $349 billion allocated by Congress through the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
LMA members who want to apply for the loan can do so through any existing SBA 7(a) lender, or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Lenders not currently eligible will be able to make these loans once they become approved and enrolled in the program.
LMA Members should contact their lender to learn if they are certified and participating in the program. This is a brand-new program and lender responses have varied.
Loan applications are currently being accepted, and the program will be available through June 30, 2020. The program is first-come, first-serve.
The application form, to be used with your lender, is here – https://www.sba.gov/sites/default/files/2020-04/PPP Borrower Application Form.pdf.
Click here for an information document on the PPP. Below are links to the SBA and Treasury websites. LMA members with questions are encouraged to reach out to LMA Government and Industry Affairs Associate Pierce Bennett at email@example.com or 937-541-1287.
SBA Loan Opportunity for COVID-19 Relief
(3/31/2020) The Small Business Administration (SBA), currently has tools available for small businesses across the country to help them recover from economic damages caused by the COVID-19 outbreak.
Called Economic Injury Disaster Loans (EIDL), the SBA is currently taking applications from small businesses to apply. The loans can be taken out for a maximum of $2 million, have an interest rate of 3.75% for small business and 2.75% for non-profits, and have repayment timelines that can go as long as 30 years. Terms will be determined on a case-by-case basis based on a borrower’s ability to repay.
These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. LMA members who wish to apply for these loans should click here: https://disasterloan.sba.gov/.
For questions, please view the SBA Guide to the CARES Act or contact the SBA disaster assistance customer service center at 1-800-659-2955 (TTY: 1-800-877-8339) or e-mail firstname.lastname@example.org.
For LMA assistance in understanding the SBA loan process, LMA membership is encouraged to contact Pierce Bennett, email@example.com; (937)541-1287.
Critical Infrastructure – Travel Authorization Update
(4/9/2020) The Federal Motor Carrier Safety Administration (FMCSA) has extended its Emergency Declaration through May 15th. The extension will continue the exemption from hours of service rules for livestock haulers. The declaration can be found here:
States are continuing to issue their own emergency declarations that provide relief from truck weight limits. It is recommended to check with your state departments of transportation for more information on such exemptions or modifications.
(4/2/2020) Below, you will find updated travel authorizations for auction employees and truckers, as well as new forms for dealers and auctioneers.
These letters are intended to aid individuals when interacting with law enforcement while traveling through areas that have restricted non-essential travel due to COVID-19 precautions.
On March 28, 2020, the Cybersecurity and Infrastructure Security Agency (CISA) of the U.S. Department of Homeland Security published an updated list of critical infrastructure workers and explicitly included “[f]armers, farm workers, and agribusiness support services to include those employed in auction and sales….” As such, we have updated the following documents to include that instructive language and have also generated self-certification documents for our dealer/order-buyer members and auctioneers.
It should be noted that the critical infrastructure list as well as these travel documents are only advisory in nature. States, counties, and municipalities can place and enforce their own travel restrictions. We encourage all individuals involved in the livestock marketing business to be proactive in their communications with law enforcement in order to best facilitate their movement to and from their places of business.
Please note, certain states may have their own recommended travel documentation. One state of which we are aware is Texas. Please follow this link for Texas-specific travel documentation, which is made available by the Texas Department of Agriculture: https://www.texasagriculture.gov/Portals/0/forms/COMM/Essential_Worker_Travel_Form_3.25.2020.pdf
If you have any questions or concerns, please reach out to the Livestock Marketing Association at (800)821-2048 or your Region Executive Officer.
Continuing Operations during COVID-19
(March 23, 2020) Livestock Marketing Association is hard at work ensuring you have the ability to continue conducting sales during the rapidly changing COVID-19 situation. Livestock auctions taking proactive measures to reduce crowd size have helped in this effort and must continue.
From a national perspective, livestock auctions can continue to operate. In fact, the Centers for Disease Control and Prevention (CDC) and White House have deemed food supply to be critical infrastructure. This federal recommendation is backed by the Department of Homeland Security (DHS) deeming food and Agriculture employees as part of the essential critical infrastructure workforce during COVID-19.
However, states may create their own rules. We’ve seen an increased number of states restricting crowds to less than 50 or even less than 10 people. In some areas, we are seeing stay at home orders. Thankfully, we believe livestock markets to be exempt as a part of the food supply.
Additionally, city and county officials may make their own rules in addition to state requirements. If you have not yet connected with your local political leadership and health department, you may want to reach out to explain that your business must continue to operate to allow livestock to continue moving in the food supply chain. Explain that meat cases all over the country are empty and livestock auction markets like yours are the primary source of the cows and bulls needed to make ground beef. You may also wish to share that your livestock auction is likely the only way local producers can generate needed cash flow during this difficult time.
Please also note, many states and local municipalities are requiring restaurants (and market cafes) move to offering takeout orders only and stop allowing dine-in service.
While we have been successful in keeping auctions open, this flexibility could be lost if we do not take preventative measures. I’ve included an LMA alert with some ideas on how you can adjust your business by reducing people in attendance and taking additional actions.
Suggested Strategies to Continue Operating
In order to keep markets open and to maintain business continuity across the industry, we must all follow all relevant local, state and federal mandates. If we do not act responsibly in taking necessary measures, we will lose the ability to operate.
We ask that you take these take steps to mitigate disease spread and create contingency plans accordingly. The following strategies may be beneficial to prepare your operations:
- Familiarize yourself with and follow rapidly changing local and state rules regarding assembly of crowds. If you need assistance interpreting relevant recommendations and mandates, please reach out to Chelsea Good at firstname.lastname@example.org/816-305-9540 or your Region Executive Officer;
- Work with your café operators to follow location-specific guidance which may include closure or offering to-go service only;
- Limit crowd sizes:
- Limit attendees in the arena to buyers only;
- Discourage children or anyone under the age of 18 to be in attendance at the sale;
- Discourage groups of people from congregating and, in particular, ask that they follow the CDC recommended 6-foot distance between individuals;
- Request that consignors deliver livestock and return home rather than remaining at the facility;
- Offer consignors flexibility in picking up their checks if they can’t wait for them to arrive by mail, such as delivery or pick up from their vehicle while remaining in parking lot;
- Evaluate all options to utilize web broadcast or phone bidding;
- Clearly communicate and enforce your policies:
- Update your website with instructions to customers and your plans for continued operation;
- Utilize your social media platforms to share fact-based information and your plans for continued operations. If you need help drafting your social media or website statements, please reach out to Kristen Parman at email@example.com/816-645-5916 or your Region Executive Officer.
- Put up signs to communicate with visitors. If you need help crafting sign language, please reach out to LMA;
- Make announcements from the auction block throughout the sale reminding everyone of expectations for crowd limits;
- Designate a staff person to monitor entry to the arena and/or regularly monitor the number of individuals present to stay within recommended crowd size limits;
- Limit attendees in the arena to buyers only;
- Take other preventative measures:
- Instruct any employee or visitor exhibiting symptoms of illness to remain home and request that any employee or visitor who is a member of a population of heightened vulnerability to consider avoiding areas where people are gathering;
- Provide ample opportunities for visitors and employees to wash hands following CDC best practices;
- Clean and disinfect all commonly used areas frequently including restrooms and restocking with soap, paper towels, and hand sanitizer;
White House Lists Livestock Auctions as Essential Critical Infrastructure
(March 28, 2020) Please read the Guidance on the Essential Critical Infrastructure Workforce. If you have any questions regarding individual state action please contact LMA Staff.
Develop Market Policy and Signs
(March 20, 2020) — For assistance in developing signage and policy for your auction, please email Kristen Parman at firstname.lastname@example.org or call 816-645-5916.
Temporary Hours of Service Exemption for Livestock Haulers
(March 18, 2020) — Due to the COVID-19 emergency relief effort, the Federal Motor Carrier Safety Administration (FMCSA) has exempted livestock haulers from compliance with federal Hours of Service rules that limit drive time until at least April 12. Drivers wishing to haul under this exemption are suggested to print out and keep in their cab a copy of the Expanded Emergency Declaration, available here. The Expanded Emergency Declaration provides relief to those drivers hauling “food” and “immediate precursor raw materials… that are required and to be used for the manufacture of … food.”The FMCSA recently released a Frequently Asked Questions (FAQ) document available here, which specifically explains all classes of livestock are covered by the exemption and further explains how the exemption is to be used. Once the driver has returned to their “normal reporting location,” the driver must still receive a minimum of 10 hours off duty to rest.
If any LMA member has questions or experiences challenges using this exemption, please reach out to LMA General Counsel, Jara Settles, at email@example.com or 816-401-1651.
State by State Information
Colorado FAQ Stay in Place Order (3/25/2020)
Livestock Markets Guidance COVID-19 (3/30/2020)
Livestock auction guidance from NDA (4/1/2020)
COVID-19 DOH Order (3/23/2020)
Letter to Livestock Market Operators (3/23/2020)
To date (3/23/2020), the CDC has not received any reports of pets or other animals becoming sick with COVID-19. There is no evidence pets can spread COVID-19 and with the knowledge we have received from the CDC, there is no reason to think that any animals in the U.S. might be a source of infection with this new coronavirus. For additional information and facts please visit the following websites:
CDC Coronavirus Website
AVMA Coronavirus Website
TAHC COVID-19 Website
TAHC COVID-19 FAQ
Essential Critical Infrastructure Workers (3/23/2020)