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Inside Washington

COVID relief bill includes $16B in farm aid payments

Capitol building
Budget reconciliation package proposed by Democrats will increase food assistance and offer financial relief to farmers of color.

As part of its reconciliation bill for additional coronavirus aid, the House and Senate each released details of the $16 billion for the agricultural portion of the bill. In an 8 hour-long business meeting Wednesday, the House Agriculture Committee began markup of the bill that revealed the lack of bipartisan support for the bill to provide direct payments to farmers of color, enhanced Supplemental Nutrition Assistance Program benefits and rural health funding. The committee advanced the final package on a party line vote late Wednesday evening. 

Last week, Democrats moved forward $1.9 trillion in COVID-19 relief legislation through the reconciliation process. The blueprint allows Democrats, who hold narrow majorities in both chambers of Congress, to pass the relief package without any Republican votes, working around the U.S. Senate’s filibuster that requires 60 votes to end debate.

In a business meeting Wednesday afternoon, the House Agriculture Committee allowed for amendments to the agriculture portion’s recommendation for the budget resolution. None of the amendments brought forth by the Republican members were approved by any Democrat members, except one which Rep. Cindy Axne, D-Iowa, crossed party lines in voting to allow for 2020 disasters to be included in some of the nearly $4 billion in available funds.  

Earlier in the week Ranking Member Glenn “GT” Thompson, R-Pa., criticized what he termed a partisan reconciliation measure, and many Republican members also expressed their frustration during the business meeting with the lack of minority views’ inclusion in the process and funding levels laid out by Democrat leadership.

“Democrats unveiled their $16 billion bill which was drafted behind closed doors, placing secrecy over solutions. The package is neither timely, nor targeted, and will fall devastatingly short of delivering direct relief for the agriculture industry and farm families,” Thompson says. “I implore my colleagues across the aisle to work with us to more thoroughly review resources and needs to better provide support.”

House Agriculture Committee Chairman David Scott, D-Ga., consistently states, “We cannot let this good idea derail this process,” in denying any attempt by the Republican minority on the committee to implement restrictions for instance on additional spending of the bill until the previously allocated $1.1 trillion in past bills are paid out.

The first vote on an amendment revealed the party-line vote of 24 Democrats voting against the amendment and 23 Republicans who voted in favor of the amendment offered by Thompson.  It featured an hours long debate on Thompson’s amendment to reduce the spending by 23% and make critical investments in rural broadband without reducing spending on SNAP or socially disadvantaged farmers.

During open comments, Thompson says over the past year, Congress authorized more than $72 million of assistance for USDA to distribute for hungry families, distressed producers and shattered communities. However, USDA has obligated roughly 60% of the funds provided and no hearings have looked at the COVID response and account for what’s been spent.

In addition, during the Biden administration’s regulatory freeze, the Coronavirus Food Assistance Program payments in the December bill are on pause. Thompson says the Biden administration should unfreeze CFAP to provide immediate assistance to farm families. An individual amendment also called for the unfreezing of the CFAP funds.

Black farmers aid

Scott says the billions in trade mitigation payments for farmers in 2017, 2018 and 2019 broadly did not benefit the population the latest COVID relief targets, including loan assistance for Black farmers and other farmers of colors. Specifically, it dedicated funding to provide debt relief to Black, Indigenous and farmers of color, as well as over $1 billion to improve land access, address heirs property issues, establish an equity commission, and create a legal center to provide legal advice and resources to BIPOC farmers.

Related: Senate bill offers $5B in relief to farmers of color

He says the $10 billion in commodity crops targeted in the December 2020 COVID package “left some folks behind” and he’s asking his colleagues to support the $5 billion to support Black farmers and other farmers who have “suffered mightily under this pandemic.”

The loan forgiveness for Black farmers was debated intensively throughout the markup, with much of the discussion coming from Rep. Austin Scott, R-Ga., who says the funds would lead to reverse discrimination if USDA would forgive 120% of all outstanding USDA loans for farmers of color. “As this pushes forward, courts have ruled Congress cannot discriminate on race,” Austin Scott says, adding there are no distinction that farmers have to prove discrimination and payments would be based solely on a producers’ skin color.

Rep. Randy Feenstra, R-Iowa, filed an amendment to reduce the amount of debt forgiveness from 120% of debt which was included by Chairman Scott to account for the tax consequences of debt relief to 100%. Forgiveness of a debt can be a tax event for the farmers leaving them to bear the burden of the tax liability which is why Scott says the 120% is warranted.  

Forgiving 120% of loans could also lead to a dangerous precedent, Austin Scott explains. USDA has already settled in the Pigford case which in 1997 and 2010 paid out over $2 billion in discriminatory claims to Black farmers.

Rep. Vicki Hartlzer, R-Mo., filed an amendment to limit the scope of this debt forgiveness to farmers of color to debt incurred during COVID-19.

Specific provisions

The lone Republican approved amendment was introduced by Feenstra to add a provision to make assistance available to producers who suffered disaster losses in 2020 -- including losses due to high winds and the derecho that devastated a large swath of Iowa. The National Oceanic and Atmospheric Administration estimated damages from the derecho to be $7.5 billion, which is a larger cost than nine of last year’s 10 hurricanes and tropical storms that made landfall. The provision would provide payments to producers who suffered damages as a result of the derecho through the USDA’s Wildfire and Hurricane Indemnity Program (WHIP). Axne, the loan Democrat vote, serves in a predominantly rural district in Western Iowa with some western Des Moines suburbs.

Despite arguments made by the majority, this amendment would not impact the overall budgetary impacts of this legislation; it would simply redirect some of the $4 billion in funding allocated in the relevant section towards this needed purpose, says a statement from Feenstra.

Scott says overall the bill will help to continue the vital food assistance through the SNAP Program as families face continuing uncertainty under this pandemic, while allowing the secretary of agriculture to assist “rural communities in helping their citizens access food assistance and health care, including access to COVID-19 vaccines, and shoring up our food supply chains.”

Senate Agriculture Committee Chairwoman Debbie Stabenow worked with Scott and House Education and Labor Committee Chairman Bobby Scott, D-Va., to secure the provisions in the ag portion of the bill.

Specifically, the bill extends the 15% increase in SNAP benefits for all participants through September 30, 2021. It provides support to states to implement this change. It also provides $25 million to USDA to support the expansion of online SNAP through investments in technology modernization and increased technical assistance. This is similar to the Expanding SNAP Options Act that was introduced by Sen. Dick Durbin, D-Ill., and Rep. Robin Kelly, D-Ill., last year. 

According to a statement from Stabenow, inspired by Stabenow’s bipartisan Food Supply Protection Act, the bill responds to the COVID-19 disruptions in the food supply chain and makes long-term investments to increase the resiliency of the food supply in the future.

A portion of $4 billion in total funding to strengthen supply chains and build further resilience in response to the pandemic. That includes providing financial assistance for equipment and supplies for food processors, farmers markets and similar entities to respond to the pandemic and protect workers in a manner similar to Rep. Kim Schrier’s, D-Wash., Food and Farm Emergency Assistance Act and Stabenow’s Food Supply Protection Act. This will provide grants and loans to purchase personal protective equipment, test kits and other measures to keep essential food workers safe. It also provides infrastructure investments and retooling support for food processors, farmers markets, and producers to build resiliency in the food supply in the long term.

Financial assistance in the form of $100 million and overtime USDA fee relief will help ensure processing capacity for small meat processing plants that have been at maximum capacity during the pandemic. The provisions mimic what was included in the Small Packer Overtime and Holiday Fee Relief COVID-19 Act introduced by Reps. Angie Craig, D-Minn., and Dusty Johnson, R-S.D., and Sens. Jerry Moran, R-Kan., and Michael Bennet, D-Colo., for leading efforts to address costly USDA fees.

Craig says the funds will help ensure small meat processing plants can continue, as many small plants have been a “saving grace” during the pandemic. Craig also welcomed the inclusion of $300 million for animal disease surveillance, highlighting the emerging cases in animals underscores the importance of animal health in the COVID response.

Many rural hospitals faced significant financial challenges even before the pandemic leaving many in dire financial straits. The bill provides important relief to rural hospitals by providing them with grants. The bill increases capacity to provide vaccines in rural areas; purchases needed medical supplies: provides assistance to help hospitals stay afloat by reimbursing COVID-19 related expenses; and helps rural patients access health care safely through telemedicine so that they can get help no matter where they live.

Another Feenstra proposed amendment would ensure that any unused funds at the end of Fiscal Year 2022, that don’t have specified sunsets, are returned to the U.S. Department of the Treasury. Given that roughly 60% of ag and nutrition funds made available in previous COVID-19 relief packages passed last year still remain unspent, Feenstra believes this provision would be a small step towards ensuring that money is not spent unnecessarily or wastefully. This amendment vote failed on party lines.

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