WASHINGTON, DC - The $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act was officially passed and signed late Friday. The move, which is being called a historic one to offer aid amidst COVID-19, includes upward of $9.5 billion for the ag industry.
The Act passed quickly, with a vote of 97-0 by the Senate before being followed by the House of Congress, and then finalized with a signature by President Trump.
“The COVID-19 outbreak has been devastating for much of our fresh produce supply chain,“ said Tom Stenzel, President and CEO of United Fresh. “We’re grateful that Congress came together in a bipartisan fashion to provide this incredible $2 trillion package to help mitigate some of the immediate consequences throughout the economy.”
Western Growers President and CEO Dave Puglia also supported the move as the news hit of the CARES Act passing.
“On behalf of the fresh produce industry, we applaud the collective efforts of both houses of Congress, as well as President Trump and his Administration, in crafting and passing a bill that will provide much-needed financial support for both farmers and Americans in every part of the country,” Puglia shared in a statement. “American farming companies, and their employees, are heroically shouldering the burden of providing our country with a safe, healthy, and ample food supply in the midst of our national crisis. We cannot afford to let the current economic disruption disrupt the production of our food. We are confident that provisions of the CARES Act, including emergency funding for specialty crop producers, small business loans, and tax relief, will help ensure our farmers and their employees can continue being the food heroes we need them to be.”
In addition to the $9.5 Billion Targeted Emergency COVID-19 Fund to support impacted agriculture, a United Fresh press release offered the following breakdown of the aid this passage will provide our industry:
- Paycheck Protection Program – $350 billion for new SBA 7(a) Loan Program for businesses with no more than 500 employees. Loans can be used for the following: payroll and benefits; mortgage interest payments (excluding principal and excluding pre-payments); rent; utilities; and interest payment on other debts
- Middle Market Loan Program – $454 billion will be available to “businesses not otherwise receiving adequate economic relief in loans and guarantees”. Most importantly, it requires the Treasury Secretary to provide financing to banks and other lenders to make direct loans to businesses with 500 to 10,000 employees at interest rates of not more than 2 percent and no interest or principal payments due within at least 6 months of loan origination
- Charitable Deductions – The CARES Act Increases the limitations on deductions for charitable contributions for corporations and individuals who itemize. In particular it increases the limitation on deductions for contributions of food inventory from 15 percent to 25 percent; for corporations, the 10 percent limitation is increased to 25 percent of taxable income; and for individuals, the 50 percent of AGI limitation is suspended for 2020
PMA has kept its members up to date on the developments in DC as well, following closely how those events might influence our industry.
“On Friday, March 27, President Trump signed the $2 trillion stimulus aimed at alleviating the impact of the COVID-19 pandemic on the American public and U.S. economy,” PMA’s Richard Owen, Vice President of Global Membership and Engagement, said in a statement, alluding there is still more to be done. “PMA will work to encourage the Administration and other groups to ensure fresh produce and floral challenges related to COVID-19 are addressed in the implementation stage of the stimulus package.”
Stenzel, too, stated work continues on despite the good news from the Administration.
“Specifically, we thank Congressional leaders for including $9.5 billion targeted specifically for fruit and vegetables, livestock, dairy, and regional food systems,” Stenzel continued. “There is more work to do and we look forward to working with USDA Secretary Perdue and others to ensure that relief is felt throughout our supply chain. Our top priority remains stabilizing and ensuring that the entire fresh produce industry can keep the supply chain moving today, and be ready to support the foodservice economy when this crisis is over.”
A complete overview of the CARES Act by United Fresh, including additional resources for broader provisions, can be found here.
We understand that information is key as the industry works to serve all sides of the supply chain during this challenging time. AndNowUKnow will continue to keep you informed of the latest developments as they become available.
United Fresh Association Western Growers AssociationProduce Marketing Association
