University of Maryland Extension

What do urban and small-scale direct-market farmers need to know about the USDA's new COVID-19 assistance program?

What do urban and small-scale direct-market farmers need to know about the USDA's new COVID-19 assistance program?

Neith Little, Extension Agent, Urban Agriculture, University of Maryland Extension

5/26/2020

 

The United States Department of Agriculture (USDA) has announced a new program called Coronavirus Food Assistance Program, or CFAP, to provide direct payments to farmers who have suffered financial losses “due to market supply chain disruptions due to COVID-19” (https://www.farmers.gov/cfap).  

Urban farmers and small-scale direct-market farmers are eligible to apply for this funding support, even if they have never participated in a USDA program before. USDA defines a farm "any place that produced and sold—or normally would have produced and sold—at least $1,000 of agricultural products during a given year" (USDA-ERS). 

Most likely, the “Specialty Crops” part of the program will be most relevant to urban and small-scale growers (https://www.farmers.gov/cfap/specialty). “Specialty crops” is the term USDA uses to describe most fresh fruits and vegetables, which are commonly grown by urban farmers and small-scale direct market producers. The USDA CFAP program also has financial supports for livestock producers and commodity crop (grains) producers.

According to a new article by UMD Ag Law Education Initiative’s Paul Goeringer,

“Specialty Crop Payment Producers of specialty crops are eligible for CFAP payments in the following three categories:

  • Category 1: Had crops that suffered a five percent-or-greater price decline between January 15, 2020, to April 15, 2020, as a result of the COVID-19 pandemic,
  • Category 2: Had produce shipped between January 15, 2020, to April 15, 2020, but subsequently spoiled due to loss of marketing channel, and
  • Category 3: Had shipments that did not leave the farm between January 15, 2020, and April 15, 2020, or mature crops that remained unharvested.”

For example, if a farm would usually sell their produce at a farmers’ market in April, but that farmers market did not open due to COVID-19, and as a result the produce did not leave the farm, that could fall under Category 3.

If a farm would usually sell their produce to a high-end restaurant, but the restaurant cancelled orders due to COVID-19, and the farm instead sold that produce at a lower price somewhere else, that could fall under Category 1.

More information about what kinds of fruits and vegetables are eligible, and how payments would be calculated are available from the USDA here and in Paul’s article here.

[EDIT 5/27/2020: Note that only certain kinds of fruits and vegetables are eligible, and payment rates are mostly less than $1 per pound (see pp. 12-14 of Paul's article for eligible produce and payment rates). This means that whether it is worthwhile for any particular farm to apply depends on what kind of produce and how many pounds of it went unsold or was sold at a lower price.]

Sign-up for the CFAP program began May 26, 2020 and is open through August 28, 2020. You can apply online or through your local USDA Farm Service Agency (FSA). USDA FSA offices are currently open for business by phone appointment only. Below is the contact information for USDA FSA offices for urban centers in Maryland and Washington, DC:

If you have never worked with the USDA FSA before, they will ask for some information about your farm, including “Name and address, your Tax Identification Number, farm operating structure, Adjusted Gross Income compliance certification to ensure eligibility, and direct deposit information to enable payment” (https://www.farmers.gov/cfap/faq). You will also need to document your losses in some way, so start gathering sales records and any correspondence about cancelled orders or closed markets.

 

References:

USDA Coronavirus Food Assistance Program (CFAP) website: https://www.farmers.gov/cfap

Paul Goeringer (2020) New Coronavirus Food Assistance Program May Provide Relief to Maryland Growers Due to CVID-19 Losses. https://drum.lib.umd.edu/handle/1903/25980
To access the pdf, click the link on the left of the page under the heading “View/Open.”

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