USDA Pauses Additional Assistance for CFAP1 and CFAP2, Second Stimulus (CFAP3) Funds Largely Unaffected

Temporary freeze issued on new and pending regulations related to CFAP funding, but current open application period for eligible changes still intact

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A series of announcements have been made regarding CFAP funding recently.  Below, K·Coe’s Farm Program Services team has summarized what you need to know about the temporary pause on CFAP assistance.

Recent Turn of Events

  • On January 15, the USDA announced additional assistance would be provided for limited producers.
  • On January 20, newly confirmed President Biden, by executive order, placed a regulatory freeze on all new and pending rules until a department or agency head appointed by the president reviewed and approved the rule.
  • On January 27, the USDA announced the executive order would affect the January 15 notice providing additional assistance to producers in CFAP1 and CFAP2.

What You Need to Know:

  • This will not affect the current open application period for eligible changes.
  • FSA is still accepting the designated new and/or amended applications but is not acting on the applications until the agency review has been completed.
  • This application deadline is still currently February 26.

Potential Impacts

This ultimately will not affect funding specified in the second stimulus bill (often called CFAP3). Because the funds in the stimulus bill are now law, the only way they can effect change on funding would be through an action taken by Congress.

Some of the items in the notice released on January 15 are directly tied to and designated in the stimulus bill, and while payment and implementation might be paused, there is little concern in the ultimate administering of the funds. In fact, in yesterday’s Senate confirmation hearing for Secretary Vilsack, Senator Hoeven of North Dakota asked about this issue and Secretary Vilsack assured him that for congressionally mandated items, this is just a temporary pause.

The main items that are not specified in the stimulus bill which could be at risk to an administrative change in direction:

  • Hog and Swine Producers “top-up” payment of $17/head for CFAP1 reported inventory between April 16
    • These funds are designated from the Commodity Credit Corporation (CCC) and the administration has indicated they want to use these funds in other initiatives.
  • Addition of turfgrass sod and pullets to “sales-based commodities” in CFAP2
    • This was an agency review of these commodities and the determination they met the guidelines that allowed them to be added to be eligible for funding.
  • Allowance to use ARC-Co yields for “price-trigger” crops in certain circumstances for CFAP2

It is important to remember this is a blanket regulatory freeze and, in many cases, will be used to put the Biden Administration’s stamp on the rules, but it does not guarantee canceling of rules.

Brian Kuehl, K·Coe Isom’s Director of Government and Public Affairs, adds, “Right now, we are not overly concerned about this pause by the Biden Administration. We understand the Administration wants to take time to review all new and proposed rules, and while there is some concern for agency discretion funding and CCC funds, we expect that the Administration will understand producers have been greatly affected by COVID-19 disruptions and will therefore be committed to helping provide the assistance needed to those producers.”

Should any changes be made to these funds or any other, K·Coe Isom will provide additional analysis and further guidance to producers.

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