By Randy Gordon, President and CEO
The NGFA on May 21 joined 135 other national trade organization in a U.S. Chamber of Commerce-led effort urging Congress and the Trump administration to provide more flexibility for businesses to utilize funds provided under the Paycheck Protection Program (PPP) in response to the COVID-19 pandemic.
In a letter to the bipartisan leadership of both the House and Senate, as well as to Treasury Secretary Steven Mnuchin and U.S. Small Business Administration (SBA) Administrator Jovita Carranza, the NGFA and other groups urged that the Congress adopt emergency legislation to:
- Repeal the current requirement that 75 percent of loan funds obtained by businesses under the PPP be utilized exclusively for payroll, with only 25 percent available to pay for other business expenses, such as rent, utilities, mortgage interest, vendor contracts and other necessary business expenses;
- extend the current eight-week period for calculating loan forgiveness (currently, loan recipients are required to keep employees on the payroll for eight weeks); and
- extend the current June 30 “safe harbor date” for rehiring and restoring pay to furloughed workers.
The PPP, which is administered by SBA, allows companies with 500 or fewer employees to seek loans of up to $10 million from lenders, which currently are forgivable if companies use 75 percent of the loan to keep employees on the payroll for eight weeks or hire back furloughed workers before receiving loan funds. Congress on April 23 enacted a COVID-19 relief package that included an additional $320 million to replenish the PPP, whose initial $350 billion in funding provided by Congress under the Coronavirus Aid, Relief and Economic Security (CARES) Act enacted in late March had been exhausted.
“The current (PPP) rules made sense when the program was created, and when it was anticipated that stay-at-home orders would last only a few weeks,” the letter stated. “However, their implementation in the current environment is making it harder for small businesses to survive.
“These three modest changes would help ensure that the liquidity provided through the PPP can be deployed in a manner that is most likely to allow a small business to remain operational,” the letter concluded. “In addition, the extended deadline (beyond June 30 for rehiring and paying furloughed workers) would permit a more orderly return to work consistent with…phased reopening” of businesses.
In other COVID-19-related developments this week:
DHS Updates and Further Clarifies Critical Infrastructure Worker Guidance, Including for Food and Ag: The U.S. Department of Homeland Security (DHS) on May 19 updated its guidance document on the essential critical infrastructure workforce, including making several important improvements and clarifications to the section addressing those working in the food and agriculture sector.
The four government and private-sector leaders of the Food and Agriculture Sector Coordinating Council – one of whom is from NGFA – provided the proposed updates and revisions to DHS, all of which were accepted. The guidance, while not binding, has been extremely useful as most state and local governments have relied on it to exempt critical infrastructure workers – including those working in a food and agriculture-related businesses – from stay-at-home and shelter-in-place restrictions imposed during the pandemic.
In the latest iteration of the guidance – dubbed Version 3.1 – DHS’s Cybersecurity and Infrastructure Security Agency (CISA) made the following constructive changes to the food and agriculture critical worker section:
- Specifically included workers in the pet food, pet supply and feed ingredient sectors within the broad definition of “animal food.”
- Added a specific reference to workers at ethanol, biodiesel and renewable fuel facilities.
- Broadened transportation and distribution activities to encompass workers in all modes, including rail, barge and vessel (previous references were only to trucks).
- Specifically included workers involved in manufacturing biologics and vaccines.
- Broadened the category of veterinarians designated as critical infrastructure workers to include those caring for pets.
- Included workers involved in production, storage, transport and distribution of equipment used in the food and agriculture industry.
Workers at grain elevators, processing plants and feed manufacturing facilities continue to be designated as critical infrastructure workers, as they have been since the document first was published in March.
USDA and FDA Sign MOU Outlining Cooperation if Defense Production Act Executive Order Expanded to FDA-Regulated Foods: The U.S. Department of Agriculture (USDA) and Food and Drug Administration (FDA) on May 19 entered into a joint memorandum of understanding (MOU) on how they will cooperate to prevent COVID-19-related food supply chain disruptions if it becomes necessary to extend President Trump’s April 28th Executive Order to apply to FDA-regulated facilities.
Under Executive Order 13917, Trump used the Defense Production Act (DPA) of 1950 to delegate emergency authority to the secretary of agriculture to ensure continuity of operations at meat and poultry processing plants during the COVID-19 pandemic. But the executive order also authorized the secretary of agriculture to extend its application in the future to other food and agriculture supply chain resources if a need arises.
The MOU creates a process the two agencies will use, if necessary, to determine when and how USDA would exercise its authority under the DPA to apply to certain domestic food resource facilities that manufacture, process, pack or store foods that fall within FDA’s regulatory jurisdiction. Under the MOU, USDA retains exclusive jurisdiction to invoke the DPA and to issue orders utilizing that authority. But in doing so, the MOU commits USDA to consult with FDA about “appropriate action” under a “collaborative working relationship.” In addition, the MOU states that FDA will work with stakeholders to monitor the food supply for food resources not under USDA’s exclusive jurisdiction to prevent disruptions at FDA-regulated food facilities.
In an FDA letter issued to the industry about the MOU, the agency stated, “Although we hope the DPA authority will not need to be invoked, this MOU is an important part of our preparedness efforts to make sure there are processes in place to protect the food supply and prevent significant food shortages during the COVID-19 public health emergency.” The letter added, “As needed, FDA will work in consultation with state, local, tribal and territorial regulatory and public health partners; industry or commodity sector; and other relevant stakeholders (such as the Center for Disease Control and Prevention and Occupational Safety and Health Administration) to chart a path toward resuming and/or maintaining operations while keeping employees safe.”
Under the MOU, FDA requested that individuals contact the agency by email at COVID19.FoodDPA@fda.hhs.gov if they become aware of or have information about an FDA-regulated food industry or commodity sector experiencing sustained operational disruptions that could threaten the continuity of the national food supply chain and undermine critical infrastructure during the national emergency.