House passes $3 trillion crisis plan

From Aaron Stauffacher, associate director of government affairs

Another major COVID-19 economic relief package was passed today in the House of Representatives. The $3 trillion plan would touch many aspects of the economy, including dairy farms and other agricultural businesses.

However, the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act is not expected to move forward in its current form. Today’s vote was largely along party lines, with Democrats in the majority. Republicans control the Senate and are against having another spending package at this time.

Even though this legislation is not expected to become law, it may serve as a baseline for future negotiations.

The major highlight for farmers in the bill is $16.5 billion for direct payments. This would be in addition to the payments being made available through the Agriculture Department’s Coronavirus Food Assistance Program.

Other specific dairy provisions:

• Supplemental Dairy Margin Coverage (DMC) and possible payments by updating a farm’s historical production to 2019 levels up the 5 million-pound limitation. The coverage would be retroactive to the start of 2020 and sunset after 2023. DMC would not be reopened.
• An incentive to sign up for DMC for the 2021-23 marketing years by providing a payment worth 15 percent of annual premium costs. A one-time three-year election must be made.
• A program to facilitate the direct donation of dairy products to food assistance programs. Milk associated with the products would be reimbursed at fluid milk prices with the ability for USDA to pay a supplemental reimbursement.
• A recourse loan program for dairy processors, packagers, merchants, marketers, wholesalers and distributors.