LEGISLATIVE BULLETIN

Take Caution Conducting Business with New Customers
Unfortunately, the COVID-19 crisis and the market situation has created additional opportunities for thieves to exploit and scam cattle producers. CCA encourages all to remain cautious and vigilant if they are selling livestock out of state to a new buyer. Thieves can develop sophisticated scams to make transactions appear to be legitimate in an effort to collect and gather as much of your personal information as possible. Be vigilant when working with new customers and aware that scammers are still active during this time.

Prepare Now to Apply for CFAP Direct Relief Payments
USDA’s Coronavirus Food Assistance Program (CFAP) will provide $16 billion in direct economic relief payments to farmers and ranchers suffering the market impacts of the COVID-19 pandemic, with $5.1 billion of that relief earmarked for beef producers. While final details of the program are not yet available and applications are not expected to be accepted until after Memorial Day, the below information will allow you to prepare your application information in advance so you can quickly file your CFAP application once the program opens.

When the CFAP program opens, farmers and ranchers will need to submit applications through their county FSA office. CCA expects that FSA employees will be trained on the CFAP program on May 21-22 and anticipates that CFAP will open for applications after Memorial Day (May 25).

Before FSA offices begin processing applications, ranchers can get a head-start on preparing their application materials.

According to USDA, applicants will need to be prepared with the following information:

• Contact information
• Personal information, including your Tax Identification Number
• Operating structure of your ranch or farm
• Adjusted Gross Income (to ensure eligibility)
• Direct deposit information (to enable payment processing)

The above information will be reported on various USDA forms available on the CFAP website at www.farmers.gov/CFAP (under the “How to Apply Once Signup Begins” heading). While FSA will assist ranchers in filing the forms and may already have this information on file for existing customers, CCA encourages ranchers to familiarize themselves with the forms, to assemble the relevant information and to pre-fill the forms to ensure accurate and efficient processing once the program opens.

Additional information is available at www.farmers.gov/CFAP. USDA has also posted a video of yesterday’s 15-minute CFAP webinar on its YouTube page.

You can find contact information for your county FSA office here (click on the Northern or Southern region and then click on your county to find your county office’s contact information). As FSA offices are open for business by phone appointment only, you should call your county office to schedule an appointment shortly after the application period opens.

Given the program’s funding limitations, CCA encourages all members to prepare their application information as soon as possible and to contact their county Farm Service Agency (FSA) office without delay once the program opens.

House Approves HEROES Act
On Friday, the House of Representatives approved the $3 trillion Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act. The vote was largely along party lines.

The bill contains several provisions that are opposed by the GOP-lead Senate, and thus is unlikely to be taken up by that chamber. However, the bill does represent the first volley in negotiations regarding the ‘fourth round’ of COVID-19 disaster relief, and therefore notable because it provides some indication of the priorities legislators will seek to include in forthcoming legislation.

CCA affiliate the National Cattlemen’s Beef Association assembled a list of HEROES Act provisions of particular interest to the beef producing community, including:

• Establishment of a statutory dealer trust for livestock
• Support for Farm Stress Programs via state departments of agriculture to expand or sustain stress assistance for individuals engaged in farming, ranching, and agriculture-related occupations
• Direct payments to agricultural producers – appropriating an additional $16.5 billion to the pending CFAP program with an extension for compensation for 85% of actual losses through the 2^nd Quarter of 2020 (this would effectively supersede the rumored April 15 that has been discussed for the past few weeks)
• Amendments to the Commodity Credit Corporation to allow for expanded use of funds and additional oversight of any such expenditures by Congress

Again, the HEROES Act is unlikely to be taken up in the Senate, but legislators will almost certainly continue discussing further COVID-19 relief legislation. CCA will continue tracking agricultural provisions such as those listed above and will keep members apprised of any developments.

USDA to Raise Payment Caps Under Coronavirus Food Assistance Program
On April 17, President Trump and Secretary of Agriculture Sonny Perdue announced the Coronavirus Food Assistance Program (CFAP), an economic aid package for farmers and ranchers impacted by the market fallout from the COVID-19 pandemic. CFAP includes $16 billion in direct relief payments to farmers and ranchers, including $5.1 billion earmarked for cattle ranchers.

While few details have been released about CFAP, we do know that USDA was previously contemplating capping relief payments for any given producer at $125,000 per commodity and $250,000 overall. Alarmed by that news, CCA joined other cattlemen’s groups nationwide in calling on USDA to remove those payment caps. Likewise, at the urging of CCA and other agricultural groups, a bipartisan group of Senators and Representatives asked the Administration to remove payment caps under CFAP.

Earlier this month, in an interview with Brownfield Ag News, Secretary Perdue announced that USDA would be increasing those payment caps.

“We’ve heard from many members of Congress on both sides of the aisle indicating they think those payment limits are too stringent,” Perdue said. “We agreed with them and we’ve adjusted those payment limits–and we’ll see those when the rules come out.”

Secretary Perdue did not clarify what the new payment caps would be. Nor have further details of the CFAP program been released to date (including how USDA will calculate price losses for producers). USDA has submitted its proposed CFAP rule to the Office of Management and Budget, however, and CCA expects that details on the program could be released this week.

Of course, there is a risk that larger payment caps for producers could deplete the available $16 billion before some producers are able to access the relief funding. Congress is already working to provide additional ag relief funding to ensure producers are properly made whole. For instance, on April 23, Rep. Austin Scott (R-GA) introduced H.R. 6611, which would provide USDA with $50 billion “to prevent, prepare for, and respond to the COVID–19 pandemic by providing support for agricultural producers impacted by the COVID-19 pandemic, provided that the Secretary shall not apply any limitation on payments made to producers using funding provided under” the bill. As of press time, the bill is co-sponsored by a bipartisan group of 31 Congresspeople.

CCA will keep you apprised of any developments regarding CFAP or further Congressional relief for the agricultural industry.

Governor Newsom Expands Workers Compensation Access for COVID-19 Sufferers
On May 6, Governor Gavin Newsom issued an executive order easing access to workers compensation benefits for employees who contract COVID-19.

Under existing law, injured employees bear the burden of proving that an injury occurred on the job when seeking workers compensation benefits. Governor Newsom’s Executive Order shifts the burden of proof in instances of COVID-19, requiring an employer or the employer’s workers compensation insurance provider to prove that the employee contracted the disease outside the workplace.

The Executive Order is retroactive to March 19—the date on which the Governor’s statewide stay-at-home order was issued—and will remain in effect until July 5. Under the Executive Order, if an employee tests positive for COVID-19 or is diagnosed by a physician as afflicted with COVID-19 (and that diagnosis is confirmed by a test within 30 days of diagnosis), that employee will be presumed to have contracted the disease on the job if the positive test or diagnosis is made within 14 days of the employee performing “labor or services at the employee’s place of employment at the employer’s direction…on or after March 19.”

It should be stressed that the Executive Order is not limited to front-line workers or even merely essential employees but extends to all circumstances in which an employee performs “labor or services at the employee’s place of employment at the employer’s direction.”

The move could prove quite costly to employers and insurers. The Workers’ Compensation Rating Bureau of California estimates that the change could cost anywhere between $2.2 billion to $33.6 billion (though it should be noted that these estimates are based on a full-year time period, whereas the Governor’s Executive Order is effective for less than one-third of that period).

There are two minor silver linings to the Governor’s decree. First, the order falls short of the “conclusive presumption” that some labor groups had advocated; under the Executive Order, an employer or insurer can seek to prove the employee contracted the virus outside of work. Second, the Executive Order could preclude civil litigation against employers, as workers compensation is an exclusive remedy for injured workers.

Governor Issues Executive Order Providing Property Tax Relief
On May 6, Governor Gavin Newsom issued an Executive Order extending property tax deadlines and forgiving penalties for late payment under certain conditions.

Under the Executive Order, if a taxpayer “demonstrates to the satisfaction of the tax collector that the taxpayer has suffered economic hardship, or was otherwise unable to tender payment of taxes in a timely fashion, due to the COVID-19 pandemic, or any local, state, or federal government response to COVID-19,” the taxpayer will not be assessed penalties, costs or interest until May 6, 2021.

The Executive Order applies to “residential real property occupied by the taxpayer” and “real property owned and operated by a taxpayer that qualifies as a small business under the Small Business Administration’s Regulations.” Under SBA’s regulations, a “Beef Cattle Ranching and Farming” operation or a “Dairy Cattle and Milk Production” operation is a small business if annual receipts do not exceed $1 million. “Cattle Feedlots” qualify as small businesses so long as annual receipts do not exceed $8 million.

The Executive Order also gives business owners until May 31, 2020 to file business personal property (BPP) statements without penalty.

While some county tax assessors had previously waived penalties and interest for late property tax payments, those determinations had not been made uniformly statewide. Governor Newsom’s Executive Order was issued in recognition that the 10% penalty for failure to pay property taxes by the April 10 deadline were quite harsh for many taxpayers impacted by COVID-19.

Governor Newsom Issues May Budget Revision
Last Thursday, Governor Newsom issued the “May Revise” of the State Budget. The revised budget sits at $203 billion dollars (compared to the $222 billion initial proposed budget which Governor Newsom had unveiled in January), recognizing that the economic impacts of COVID-19 and the subsequent stay-at-home order will require the state to tighten its purse strings.

Two weeks ago, Governor Newsom forecasted that California could see a $54.3 billion deficit over the next 14 months (a report from the Legislative Analyst’s Office predicts a rosier deficit number between $18 billion and $31 billion). To help bridge the deficit, the Governor’s budget cancels spending expansions proposed in January, draws upon $8.8 billion in reserve, makes use of $8.3 billion in federal relief funds, caps tax credits for California taxpayers and utilizes a number of other creative measures to balance the budget.

Of particular interest to California ranchers, the Governor’s budget:

• Abandons the $4.75 billion “climate resiliency bond” previously proposed in the January budget, which would have funded a number of climate resiliency priorities including wildfire prevention and drought preparedness (an Assembly committee approved a $7 billion climate resiliency bond earlier last week, and it is possible that legislators and the administration may come into conflict over the measure)
• Allocates an additional $213 million in funding beyond current levels for the Office of Emergency Services and California Department of Forestry and Fire Protection for disaster preparedness and response (of which $85.7 million will go to augment CalFire’s budget)
• Transitions the Cap & Trade Program to a “pay-as-you-go” program with expenditures tied to actual quarterly auction proceeds. All expenditures will be focused on air quality, forest health/fire prevention and safe and affordable drinking water

The administration and legislature will continue negotiating the budget over the coming month; under the California Constitution, the State Legislature must advance a budget framework no later than midnight June 15.

Happening this week: Working Rangelands Wednesday Webinar
Join Cooperative Extension Advisors, Specialists, Researchers and Ranchers for Working Rangelands Wednesdays, where they explore topics around rangeland agriculture in California and across the West. The goal of this webinar series is to discuss challenges related to managing multiple-use rangelands through an applied, land manager-oriented lens.

The next webinar is Wednesday, May 20 at 1pm PDT and will feature a rancher-panel discussing drought management on private lands in California.

• Jeff Clark, R. Emigh Livestock, Rio Vista, CA
• Joe Fischer, Bruin Ranch, Auburn, CA
• Melissa Tregilgas, Free Hand Farm, Placerville, CA

Register HERE to receive a zoom link the morning of the webinar. Please note, this is not a direct link to the webinar– you must register in advance.

Questions? Please contact Dan Macon at dmacon@ucanr.edu. See you on Wednesday!

CDFW Clarifies Take of Mountain Lions after CESA Candidacy Decision
As previously reported in Legislative Bulletin, on April 16, the California Fish and Game Commission advanced mountain lions in the Central Coast and Southern California to candidacy for threatened-species status under the California Endangered Species Act (CESA). As a result, mountain lions in the region now enjoy protection under CESA as the Department of Fish and Wildlife (CDFW) undertakes a 12-month species status evaluation ahead of the Commission’s final listing determination in 2021.

Additionally, CCA is aware of reports that CDFW has denied lethal take permits for depredating mountain lions outside of the Central Coast and Southern California in recent months.

Given the uncertainty surrounding take of mountain lions statewide, CCA has pressed CDFW to clarify its policy regarding the issuance of mountain lion take permits. While the Department has not formally issued a written policy regarding take permits for depredating mountain lions, CCA has obtained verbal clarification from the Department regarding its issuance of such permits, as detailed below.

Within the Central Coast and Southern California
Within the Central Coast and Southern California, where the species is listed as a candidate for threatened-species status under CESA, the Department will essentially continue to adhere to the three-depredation policy issued on February 13.

Under the three-depredation policy, after a first depredation event by a mountain lion “The Department should issue a ‘non-lethal’ depredation permit to pursue/haze the mountain lion”; upon a second depredation event the department “should…issue a new non-lethal depredation permit specifying additional measures not included in the previous permit”; and upon a third depredation by a mountain lion “the Department shall issue a depredation permit to lethally remove the mountain lion.” That said, to date CDFW has not issued a lethal take permit under the February 13 expansion of the three-depredation policy, and CCA is skeptical that the Department would authorize lethal take in light of CESA candidacy (though, importantly, CDFW has not ruled-out the possibility of lethal take).

CCA has raised concerns that first-depredation take permits limited to ‘hazing’ or ‘pursuing’ mountain lions do not comply with Proposition 117 (though “to…pursue” is defined as a ‘take’ under the Fish and Game Code). Partly in response to those concerns, CDFW has made one notable change to the Department’s response to first-depredation events. CCA has received clarification from the CDFW that ‘pursuit-only’ permits are unlikely to issue, and that permits issued in response to a first depredation will likely include additional non-lethal take measures beyond mere pursuit (for instance, the authorized use of non-lethal ammunition such as rubber bullets or bean-bag rounds). Which non-lethal take tools will be permitted will depend upon local, on-the-ground circumstances, according to CDFW.

With regard to third-depredation take permits, the Department has confirmed that lethal take authorization has not been ruled out despite mountain lion CESA candidacy in the Central Coast and Southern California.

While lethal and nonlethal take allowances are seemingly at odds with CESA’s prohibition on ‘take’ of threatened or candidate species, the Department will issue such permits under Fish and Game Code § 2081(a), which provides that the Department may authorize the take of “any endangered species, threatened species, or candidate species for…management purposes.”

Importantly, the Department has also clarified that a rancher may still lethally take “any mountain lion that is encountered while in the act of pursuing, inflicting injury to, or killing livestock” as allowed under Proposition 117. Such take must still be reported to the Department within 72 hours and will still be investigated, but if the Department is satisfied that the mountain lion was “pursuing, inflicting injury to, or killing livestock,” the rancher will not be liable for a violation of CESA (if CDFW is not satisfied that the lion was in-the-act of attacking livestock, however, one may be liable for a violation of Proposition 117 and CESA). A lethal take permit issued after an investigation would also be issued under the authority of Fish and Game Code § 2081(a).

Outside of the Central Coast and Southern California
In the rest of the state, the Department is implementing a sort of ‘two-depredation policy.’ Citing Fish and Game Code § 4801.5’s intent that “nonlethal procedures shall be used when removing or taking any mountain lion that has not been designated as an imminent threat to public health or safety,” the Department will now issue only non-lethal take permits after a first depredation event. Upon a second (or subsequent) depredation event, however, the Department may issue a lethal depredation permit.

A rancher may still lethally take “any mountain lion that is encountered while in the act of pursuing, inflicting injury to, or killing livestock” as allowed under Proposition 117, so long as such take is reported to the Department within 72 hours so that the Department may investigate the depredation and take and issue an after-the-fact permit. If CDFW investigators are satisfied that the mountain lion was “pursuing, inflicting injury to, or killing livestock,” the rancher will not be liable for a violation of Proposition 117.

CCA continues to have significant concerns regarding the Department’s policies for issuance of take permits for depredating mountain lions, particularly in light of Fish and Game Code § 4809’s requirement that depredating mountain lions “shall be taken by the most effective means available to take the mountain lion causing the damage or destruction.” That said, the policies outlined above are preferable to an outright take prohibition that CCA feared would result from CESA candidacy.

CCA members are encouraged to communicate the results of take permit requests to CCA staff.