LEGISLATIVE UPDATE April 13, 2020
As we maneuver, these very challenging times, I will continue to provide you with the most current information that I have, but please realize that things are changing very rapidly. Please stay informed and safe.
Many of the House and Senate committees are continuing to meet. The focus of the committee work is supposed to be COVID-19 crisis related and how the state and local governments will manage through the crisis. You may watch the committee meetings; the schedule is listed on the legislative website. The Statehouse is closed to the public until further notice.
INCLUDED IN THIS UPDATE
S-333 An act relating to establishing a moratorium on ejectment and foreclosure actions during the COVID-19 emergency
HOUSE AND SENATE AGRICULTURAL COMMITTEES
UPDATE FROM BOB GRAY
SBA PAYCHECK PROTECTION PROGRAM
The Senate worked through their challenges with remote voting on Wednesday and approved their temporary remote voting resolution. This allows the Senate to vote on legislation, using Zoom. There still is a requirement that the Senate Chambers be open and that there be a person presiding over the proceeding in the Chamber with the Senate Secretary.
S-333 AN ACT RELATING TO ESTABLISHING A MORATORIUM ON EJECTMENT AND FORECLOSURE ACTIONS DURING THE COVID-19 EMERGENCY
On Friday the Senate passed S-333. The bill applies to individuals who are unable to work because of their own illness, illness of a member of the household, isolation required by the employer, isolation required by State or local government authorities or isolation required by the primary care provider or another health official. This legislation does not allow tenants to not pay rent if they are not impacted by COVID-19. There was significant discussion around proceedings that are currently underway for evictions and the challenges of a landlord in removing a tenant. Senate members wanted to maintain a fair process for landlords. S -333 is now headed to the House.
HOUSE AND SENATE AGRICULTURAL COMMITTEES
The House and Senate Ag committees continue to meet. Last week both the House and Senate committee’s discussions focused around Farmer’s Markets, community gardens, dairy crisis, school nutrition, and sludge/septage. The House also discussed S-180 An act relating to the use and application of pesticides.
Farmer’s markets and community gardens
- As it stands now farmers markets and community gardens do not meet the definition of essential need. The Agency of Agriculture is trying to develop standards that would allow these two activities to occur. There is still the ability to farms to have curbside pickup or delivery. The CSA model is also available.
- Both committees heard from the Congressional delegation on what is happening at the Federal level and from Diane Bothfeld from the Agency of Agriculture on what the state is hearing and doing. Senator Starr also discussed the proposal from Danny Smith, on a Vermont pricing system.
- $500 million/WIC
- $400 million for the Commodity Assistance Program for the emergency food assistance program
- $250 million for the Senior Nutrition program
- The Act includes several important waivers for school meals programs
- There has been significant discussion on this topic in several committees. The House and Senate Natural Resources committee heard from several witnesses regarding the sludge/septage issue around treatment plants and the concern over contaminants, PFAS. There was also a concern with the hauling capacity during the COVID-19 crisis.
- The Agricultural committees heard from the Agency of Ag on the spreading of sludge/septage
- 1030 acres of crop land in Vermont utilized in 2019
- ANR oversees the program
- Agency of Agriculture testified they would like the practice of spreading sludge stopped
S-180 An act relating to prohibiting the use and application of the pesticide chlorpyrifos
- The House Agriculture committee heard from Cary Giguere on S-180, which was passed in the Senate. The bill makes several changes to the Pesticide Advisory council along with banning the use of chlorpyrifos. Cary testified that he felt that use of chlorpyrifos did not need to be ban as it will go out of production on its own because lack of a major manufacturer of the product. Cary also did not support the changes to the Council. Forest and Parks, Fish and Wildlife and the Agency of Transportation are removed from the Pesticide Advisory Council in the Senate proposal.
Update from Bob Gray, Lobbyist for Northeast Dairy Farmers Cooperatives
Agri-Mark, Inc. – Dairy Farmers of America Northeast Council — Upstate Niagara Cooperative, Inc.
NMPF/IDFA Joint Dairy Relief Proposal To USDA
National Milk Producers Federation and the International Dairy Foods Association have made a joint proposal to Secretary Perdue to provide economic help to the dairy industry.
- We estimate that supply exceeds demand by at least 10% – a gap that could widen as supply increases to its seasonal peak and as “shelter in place” conditions endure
- Collapse of food service industry, massive economic insecurity, export distributions and seasonally rising milk supply creating a massive gap between dairy supply and demand
- Major supply chain upheaval as processors, marketers and merchants adapt to plunging restaurant sales and surging grocery store chains.
- Lacking orders for finished goods, several processing plants are curtailing or ceasing operations, resulting in cancelled milk orders
- As a result, producers and cooperatives across the US are beginning to “dump” significant quantities of milk
- Dairy commodity market prices collapsing
- Second quarter CME Class III milk futures closed at $13.24 per hundredweight on Friday, with Class IV at $11.35
- Using the DMC formula and prevailing futures prices, farm margins over feed costs project to $5.80 per hundredweight for Q2 and $6.76 for Q3
- Financial stress is building across the supply chain
- With more than 10 million Americans already losing jobs, food banks are seeing significant increases in demand, a trend that will likely only intensify in the weeks ahead
- Use as many tools as possible – as quickly as possible – to bridge the supply/demand gap
- Provide aid to dairy producers
- Alleviate systemic financial/liquidity risks across the supply chain
- Stabilize commodity markets
- Fill US food banks with dairy products for distribution to the growing number of people in economic distress
- Immediately address food insecurity by removing restrictions that limit availability of nutritious dairy products across USDA food and feeding programs
- Balance urgent needs against long-term implications
- Tie producer aid to limits in milk production
- To the extent possible, avoid any supply overhangs
Producer Initiatives Producer Market Balancing Assistance
Goal: Help offset steep decline in farm milk prices and encourage producers to reduce excess supply resulting from demand disappearance
- Pay producers $3 per hundredweight on 90% of their production if they cut production by 10% from March 2020 baseline
- Program runs for six months – April through September
- Payments during any one of the months would be suspended if the average of the Class III and Class IV prices for that month exceeds $16 per hundredweight
Temporary Milk Disposal Reimbursement
Goal: Compensate all producers and handlers for milk that must be disposed of because of supply chain disruptions resulting from COVID-19 pandemic
- Provide coverage of milk at the USDA Class IV (or lowest value Class) price
- Administer program through AMS’ FMMO audit function
- Program runs for three months – April through June (peak production season)
Processor Initiatives Recourse Loan Program to Support Working Capital
Goal: Expand availability of working capital for processors. Program would allow firms to carry heavier than-normal inventories and reduce systemic financial/liquidity risk
- USDA does use recourse loans in other commodity areas
- Cover as many products as possible – basic commodities in addition to specialty cheeses, Class II products, etc.
- Loans would cover FMMO component ingredient costs (not packing, plant margins, warehouse costs, etc.)
Forgivable Loan Program to Support Processor operations (Modeled on SBA Program)
Goal: Provide loans to processors enduring significant reductions in sales
- Recipients required to continue to purchase milk from dairy producers.
- Recipients required to maintain staffing
- Loans forgiven after compliance for a stated period Consumer Initiatives Dairy Product Purchase for Food Banks
- Immediately begin to purchase substantial volumes of dairy products for feeding programs
- Satisfies two objectives: creates demand for dairy products, ostensibly stabilizing markets, and helps address surging food insecurity as the economy contracts
- Allow a broad array of products and packaging
Other Initiatives Re-open DMC Program
Goal: Extend dairy producer financial safety net support
- Examine USDA ability to allow producers to retroactively sign up for 2020 DMC coverage with sign up required for the remainder of farm bill with no premium discount
SBA Paycheck Protection Program
CONTACT YOUR LENDER AS SOON AS POSSIBLE TO ENROLL IN THIS PROGRAM
PAYCHECK PROTECTION PROGRAM (PPP) INFORMATION SHEET: BORROWERS
The Paycheck Protection Program (“PPP”) authorizes up to $349 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis. All loan terms will be the same for everyone. The loan amounts will be forgiven as long as:
- The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8-week period after the loan is made.
- Employee and compensation levels are maintained. Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs. Loan payments will be deferred for 6 months.
When can I apply?
- Starting April 3, 2020, small businesses and sole proprietorships can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.
- Starting April 10, 2020, independent contractors and self-employed individuals can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.
- Other regulated lenders will be available to make these loans as soon as they are approved and enrolled in the program.
Where can I apply?
- You can apply through any existing SBA lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating.
- Other regulated lenders will be available to make these loans once they are approved and enrolled in the program.
- You should consult with your local lender as to whether it is participating. Visit www.sba.gov for a list of SBA lenders.
Who can apply?
- All businesses – including nonprofits, veterans’ organizations, Tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors – with 500 or fewer employees can apply.
- Businesses in certain industries can have more than 500 employees if they meet applicable SBA employee-based size standards for those industries. For this program, the SBA’s affiliation standards are waived for small businesses (1) in the hotel and food services industries or (2) that are franchises in the SBA’s Franchise Directory or (3) that receive financial assistance from small business investment companies licensed by the SBA. Additional guidance may be released as appropriate.
What do I need to apply?
- You will need to complete the Paycheck Protection Program loan application and submit the application with the required documentation to an approved lender that is available to process your application by June 30, 2020.
FROM THE AGENCY OF AGRICULTURE
The Agency has created a COVID-19 resource page for access to the latest industry guidance and resources for agricultural related service providers, businesses and interested parties. This page can be found on the Vermont Agency of Agriculture, Food & Markets website.
The Agency of Ag is also requesting information related to influences on the ag and food industry so that they can help leadership form a tactical response to the impacts of the virus. Please share this form broadly, and encourage your contacts to share their impacts here. This information will be shared with other state and federal partners.
Vermont.gov is the state’s website where you will find the latest information from all state agencies regarding COVID-19
NAICS codes – If you do not see your business listed, and you would like to request a waiver, you may fill out the Continuation of Operations form on the ACCD website
To contact the Sergeant of Arms, call 802 828 2228