Since the onset of the pandemic, CCA has continued to work closely with the National Cattlemen’s Beef Association (NCBA) to ensure that the federal government eliminates any obstacles in the food supply chain and that all producer losses directly associated with COVID-19 are addressed by Congress. Earlier today, the House shared details on a new funding package—$900 billion for COVID-19 relief and $1.4 trillion in appropriations for the upcoming fiscal year—which includes critical provisions for cattle and livestock producers.
The deal includes a new round of direct payments to cattle producers through the Coronavirus Food Assistance Program (CFAP), with the aid coming from $11 billion designated for use by the Secretary of Agriculture for COVID-19 relief.
While NCBA staff is continuing to analyze the almost-5,600 page ‘‘Consolidated Appropriations Act, 2021,’’ below are the key COVID-19 provisions of this bill for California cattle producers, as identified by NCBA and CCA staff.
CFAP for Cattle Producers:
The bill provides additional assistance for cattle producers impacted during the height of the pandemic.
For Slaughter/Fed cattle, Feeder cattle greater than 600 lbs., and Feeder cattle less than 600 lbs., the payment is calculated using the following formula: [(Cattle inventory for the period April 16-May 14 x 50%)(CARES Act Sales Rate – CFAP 1 inventory rate – CFAP 2 inventory rate)].
For example, under regulations implementing the CARES Act, the sales rate for Slaughter/Fed cattle was set at $214. Under CFAP Round 1, a producer could obtain $33/head for inventory held between April 16 and May 14. Under CFAP Round 2, that producer was eligible for another $55/head for those cattle. $214 – $55 – $33 = $126. Because the legislation requires the inventory to be multiplied by 50%, however, this equates to eligibility for $63/head of Slaughter/Fed cattle. (Per-head payments will differ for Feeder cattle greater than 600 lbs. and Feeder cattle less than 600 lbs. based on per-head figures in the CARES Act and CFAP Rounds 1 and 2; CCA will further clarify these rates for members when CFAP Round 3 is announced.)
For Slaughter/mature cattle and All other cattle, the payment is calculated using the following formula: [(Cattle inventory for the period April 16-May 14 x 25%)(CARES Act Sales Rate – CFAP 1 inventory rate – CFAP 2 inventory rate)]. For example, regulations implementing the CARES Act set the sales rate for “All other cattle” (breeding stock) at $102/head. Under CFAP Round 1, a producer could obtain $33/head for inventory held between April 16 and May 14. Breeding stock were ineligible for CFAP Round 2. $102 – $33 = $69. Because the legislation requires the inventory to be multiplied by 25%, however, this equates to eligibility for $17.25/head of All other cattle (breeding stock). (Calculations for per-head payments will differ for Slaughter/mature cattle based on per-head figures in the CARES Act and CFAP Rounds 1 and 2; CCA will further clarify these rates for members when CFAP Round 3 is announced.)
Establishment of a Dealer Statutory Trust:
The bill establishes a Federal livestock dealer trust to ensure that livestock producers are paid for their animals, securing a policy priority outlined in CCA policy. Note, this provision is identical to the Securing All Livestock Equitably (SALE) Act of 2020.
Grants for Improvements to Meat and Poultry Facilities to Allow for Interstate Shipment:
The bill provides $60 million to make facility upgrade and planning grants to existing meat and poultry processors to help them move to Federal inspection and be able to sell their products across state lines. The bill also requires USDA to work with States and to report on ways to improve the existing Cooperative Interstate Shipment program. This is a modified version of the RAMP UP Act, spearheaded by NCBA earlier this Congress.
PPP Tax Deductibility:
The bill specifies that forgiven Paycheck Protection Program (PPP) loans will not be treated as taxable income; this is a win for CCA, which joined more than 700 other organizations asking that the provision be included in the COVID relief bill. The legislation also includes $284 billion in a second round of PPP loans and simplifies the forgiveness process for loans under $150,000.
In addition to the above coronavirus relief provisions, the bill contains crucial items for the Fiscal Year 2021 (FY21). According to NCBA, the FY21 provisions relevant to those in the cattle business and livestock sector include:
- Extending Livestock Mandatory Reporting (LMR) through September 30, 2021;
- Maintaining the Electronic Logging Device (ELD) provision for livestock haulers, extending the waiver September 30, 2021;
- Addressing the Agricultural Quarantine Inspection (AQI) shortfall by providing $32 million in funding for FY21; and
- Renewing exemptions for livestock producers from EPA greenhouse gas reporting requirements for FY21.
The Public Lands Council has noted two additional components of the bill relevant to public lands ranchers. First, the package “provides $115 million for the Bureau of Land Management to continue work in their multi-year proposal to decrease wild horse populations during this fiscal year.” The deal additionally “prevents any funding being used to list the Greater Sage-Grouse under the Endangered Species Act during this fiscal year.”
The legislative package must still be approved by the House and Senate and be signed into law by President Trump, but CCA does not expect the provisions outlined above to be altered significantly during the legislative process. CCA and our national affiliates will continue to examine the legislation and will keep CCA members apprised of important provisions—and their implementation by federal agencies—in future editions of Legislative Bulletin.