USDA plans crop and income loss assistance for agricultural producers

USDA plans crop and income loss assistance for agricultural producers

WASHINGTON — Agriculture Secretary Tom Vilsack hsa announced additional emergency relief and pandemic relief plans from the United States Department of Agriculture (USDA). The USDA is preparing to roll out phase two of the Emergency Relief Program (ERP) as well as the new Pandemic Assistance Income Program (PARP), which are two programs aimed at compensating for crop losses and income for producers. USDA is sharing early information to help growers gather materials and train frontline staff on the new approach.

“We have worked diligently to help agricultural producers recover from devastating natural disasters as well as the coronavirus pandemic through a wide range of programs,” Vilsack said. “No matter how well we design these targeted efforts, we often find that some growers fall through the cracks or have been more severely affected than their neighbors. These new programs apply a holistic approach to emergency relief – one that is not focused on any particular disaster or commodity, but rather focuses on filling gaps in assistance to agricultural producers who, in recent years , suffered losses due to natural disasters and the pandemic.”

The second phase of the ERP will assist eligible agricultural producers who have experienced eligible crop losses, measured by revenue declines, due to wildfires, hurricanes, floods, derechos, excessive heat , winter storms, frost (including a polar vortex), exposure to smoke, excessive humidity and qualifying droughts occurring during calendar years 2020 and 2021.

The PARP will assist eligible producers of agricultural commodities who experienced a decline in income in calendar year 2020 compared to 2018 or 2019 due to the COVID-19 pandemic. The PARP will help fill the gaps of previous pandemic assistance, which was targeted at price loss or lack of market access, rather than overall revenue losses.

Phase 2 Emergency Relief Program

The ERP is authorized under the Government Funding Extension and Provision of Emergency Relief Act, which includes $10 billion in assistance to agricultural producers affected by wildfires, droughts, hurricanes, winter storms and other qualifying disasters experienced in calendar years 2020 and 2021.

Phase two builds on phase one of the ERP, which was deployed in May 2022 and has since paid more than $7.1 billion to growers who suffered eligible crop losses covered by health insurance. Federal Harvest or the Uninsured Harvest Disaster Assistance Program.

Phase two of the ERP includes producers who incurred eligible losses but may not have received program benefits in phase one. To be eligible for phase two, growers must have incurred a loss of qualifying gross income as defined in the upcoming program regulations in 2020 or 2021 due to necessary expenses related to eligible crop losses as a result of a qualifying natural disaster.

Eligible crops include both traditional insurable commodities and specialty crops that are produced in the United States on a farm and intended for sale. Like other emergency and pandemic relief programs, the USDA Farm Service Agency (FSA) continues to look for ways to simplify the process for staff and producers while reducing the paperwork burden. The ERP phase 2 design is part of this effort.

In general, it is expected that ERP Phase Two payments will be based on the difference in certain farm income between a typical year of income, as will be specified in the program regulations for the producer, and the year of the disaster. ERP phase two assistance is targeted to the remaining needs of producers affected by eligible natural disaster events, while avoiding windfalls or duplicate payments. Details will be available when the rule is released later this year.

Deadline for the first phase of the emergency relief program

Producers eligible for assistance through ERP Phase 1 have until Friday, December 16, 2022 to contact the FSA at their local USDA Service Center to receive program benefits. In the future, if additional ERP Phase One pre-populated applications are generated due to corrections or other circumstances, there will be a 30-day delay from the date of notification for that particular application.

Pandemic Assistance Income Program

PARP is authorized and funded by the Consolidated Appropriations Act of 2021.

To be eligible for PARP, a farm producer must have farmed for at least part of the 2020 calendar year and experienced a certain threshold decrease in eligible gross income for the 2020 calendar year, compared to 2018 or 2019 Exact calculations and eligibility details will be available when the next rule is released.

How producers can prepare

Phase two of the ERP and PARP will use income information readily available in most tax records. The FSA encourages producers to prepare their recent tax documents and supporting documents, as explained below. Producers will need documentation similar to that which was required for phase two of the Coronavirus Food Assistance Program (CFAP), where a producer could use 2018 or 2019 as a base year against the year of the catastrophe.

In the coming weeks, the USDA will provide additional information on how to request assistance through ERP Phase Two and PARP. In the meantime, producers are encouraged to begin gathering supporting documentation, including:

• Schedule F (Form 1040); and

• Farm business profit or loss or similar tax records for tax years 2018, 2019, 2020, 2021 and 2022 for ERP and for calendar years 2018, 2019 and 2020 for PARP.

Producers should also have, or be prepared to have, the following forms on file for participation in ERP and PARP programs:

•Form AD-2047, Customer Data Worksheet (as applicable for Program Participant);

•Form CCC-902, Agricultural Business Plan for a natural or legal person;

•Form CCC-901, Membership Information for Legal Entities (if applicable); and

• Form AD-1026 Certification for Highly Erodible Land Conservation (HELC) and Wetland Conservation (WC).

Most growers, especially those who have participated in FSA programs before, will likely have these required forms on file. However, those unsure or wishing to confirm should contact FSA at their local USDA Service Center.

In addition to the forms listed above, underserved producers are encouraged to register their status with the FSA, using Form CCC-860, Socially Disadvantaged, Limited Resource, Beginning and Veteran Farmer or Rancher Certification, as some existing permanent and ad hoc disasters provide increased benefits or reduced costs and premiums.

More information

Through proactive communications and outreach, USDA will keep growers and stakeholders informed about program eligibility, application details, and implementation.

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