[Federal Register Volume 85, Number 99 (Thursday, May 21, 2020)]
[Rules and Regulations]
[Pages 30825-30835]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-11025]



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 Rules and Regulations
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 This section of the FEDERAL REGISTER contains regulatory documents 
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  Federal Register / Vol. 85, No. 99 / Thursday, May 21, 2020 / Rules 
and Regulations  

[[Page 30825]]



DEPARTMENT OF AGRICULTURE

Office of the Secretary

7 CFR Part 9

[Docket ID: FSA-2020-0004]
RIN 0503-AA65


Coronavirus Food Assistance Program

AGENCY: Office of the Secretary, USDA.

ACTION: Final rule.

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SUMMARY: The Secretary of Agriculture is issuing this rule to implement 
the Coronavirus Food Assistance Program (CFAP). CFAP provides 
assistance to agricultural producers impacted by the effects of the 
COVID-19 outbreak. This rule establishes provisions for direct payments 
to producers of eligible commodities. This rule specifies the 
eligibility requirements, payment calculations, and application 
procedures for CFAP.

DATES: Effective Date: May 21, 2020.

FOR FURTHER INFORMATION CONTACT: William L. Beam; telephone: (202) 720-
3175; email: [email protected]. Persons with disabilities who require 
alternative means for communication should contact the USDA Target 
Center at (202) 720-2600 (voice).

SUPPLEMENTARY INFORMATION: 

Background

    In response to the COVID-19 outbreak, the Coronavirus Aid, Relief, 
and Economic Stability Act (CARES Act; Pub. L. 116-136) was enacted. 
Title 1 of Division B, of that Act provides $9.5 billion to remain 
available until expended, for the Office of the Secretary to use to 
prevent, prepare for, and respond to coronavirus by providing support 
for agricultural producers impacted by coronavirus, including producers 
of specialty crops, producers that supply local food systems, including 
farmers markets, restaurants, and schools, and livestock producers, 
including dairy producers. The amount is designated by the Congress as 
being for an emergency requirement pursuant to section 251(b)(2)(A)(i) 
of the Balanced Budget and Emergency Deficit Control Act of 1985.
    This rule implements the $9.5 billion provided under the CARES Act 
to support agricultural producers to prevent, prepare for, and respond 
to coronavirus. In addition, in accordance with 15 U.S.C. 714b, the 
Secretary is using funds of the Commodity Credit Corporation (CCC) to 
assist producers with the purchase of materials and facilities required 
in connection with the production and marketing of agricultural 
commodities and to remove surplus commodities from normal marketing 
channels. At this time, the amount of CCC funds available for these 
purposes is limited to $6.5 billion. While section 11002 of the CARES 
Act provides for a $14 billion replenishment of CCC's borrowing 
authority, these funds will not be available to CCC until after June 
2020.
    Taking into account these two funding sources, the Secretary has 
established CFAP to provide producers with financial assistance that 
helps offset sales losses and increased marketing costs associated with 
the COVID-19 pandemic. Income losses will be partially compensated 
under the CARES Act. CCC authorities will be used to partially 
compensate producers for the purchase of materials and facilities 
required in connection with the production and marketing of 
agricultural commodities and the disposal of surplus commodities from 
normal marketing channels that may be currently unavailable. In order 
to reduce the exposure of producers to COVID-19 and to reduce the 
workload of USDA employees during this pandemic, one payment 
application and one payment will be issued by USDA to eligible 
producers by combining CARES Act and CCC funds.
    Two principal USDA agencies will be used by the Secretary to 
implement CFAP, the Farm Service Agency (FSA) and the Agricultural 
Marketing Service (AMS). FSA will be the principal agency charged with 
implementing CFAP and AMS will assist FSA with respect to matters 
dealing with producers of specialty crops.
    Generally, in order to be eligible for a payment, a producer must 
have suffered a 5-percent-or-greater price loss over a specified time 
resulting from the COVID-19 outbreak or face additional significant 
marketing costs for inventories. COVID-19 price losses are due to 
significant declines in certain types of demand. Additional marketing 
costs from COVID-19 are due to surplus production or to disruptions to 
shipping patterns and the orderly marketing of commodities. In 
addition, due to the COVID-19 outbreak, many farmers markets, 
restaurants, and schools have temporarily or permanently closed, thus 
causing significantly decreased demand for commodities grown by 
producers that are ordinarily supplied to these places. Non-specialty 
crops eligible for CFAP payments are malting barley, canola, corn, 
upland cotton, millet, oats, sorghum, soybeans, sunflowers, durum 
wheat, and hard red spring wheat. Payments also will be available for 
specialty crops (including, but not limited to almonds, beans, 
broccoli, sweet corn, lemons, iceberg lettuce, spinach, squash, 
strawberries, and tomatoes), dairy, cattle, lambs and yearlings, wool, 
and hogs and pigs. Additional eligible commodities, such as aquaculture 
and nursery crops (including cut flowers) will be announced in a 
subsequently announced Notice of Funding Availability (NOFA) issued by 
FSA on behalf of the Secretary; any additional commodities would also 
need to meet the eligibility requirements in this rule. Throughout this 
rule, ``producer'' refers to a person or legal entity who shares in the 
risk of producing a crop or livestock and who is entitled to a share in 
the crop or livestock available for marketing.
    CFAP will provide eligible producers with financial assistance that 
helps them offset sales losses and increased marketing costs resulting 
from the COVID-19 pandemic. With respect to commodity and livestock 
losses due to price declines that occurred between mid-January 2020 and 
mid-April 2020 and, in the case of specialty crops, for products that 
were shipped but spoiled and no payment was received, CARES Act funds 
will be used in accordance with authority under the CARES Act. Funds 
available to CCC will be used as authorized by sections 5(b), (d), and 
(e) of the CCC Charter Act (15 U.S.C. 714c(b), (d), and (e)). These 
authorities will be used to partially compensate producers for on-going 
market

[[Page 30826]]

disruptions and assist with the transition to a more orderly marketing 
system as the pandemic wanes by:
     Assisting with the purchase of materials and facilities 
required in connection with the production and marketing of 
agricultural commodities;
     Aiding in the removal or disposition of surplus 
agricultural commodities; and
     Aiding in the development of new and additional markets, 
marketing facilities, and uses for such commodities.
    USDA will track funds from the CARES Act and the CCC Charter Act 
separately, to ensure that the payments are consistent with each 
respective authority. Payment for income loss is consistent with the 
authority provided in the CARES Act. Payment to aid in the removal or 
disposition of surplus agricultural commodities and for additional 
marketing and production costs is consistent with the authority 
provided in the CCC Charter Act. All payments will be tracked by the 
type of funding. If a single payment includes a portion from each type 
of funding, USDA will track the funds separately.

Payments

    Payments will be calculated using payment rates as specified in 
Tables 1 & 2 in the CFAP regulation in 7 CFR 9.5. USDA will make an 
initial payment of 80 percent of an eligible 2020 CFAP participant's 
calculated 2020 CFAP payment. By issuing initial payments, FSA can 
quickly provide assistance to those eligible participants that 
immediately apply for assistance while trying to ensure that 2020 CFAP 
payments do not exceed the $16 billion funding limit to ensure those 
funds are distributed equitably among all eligible producers. If funds 
remain available after the initial payment to eligible applicants, USDA 
will disburse the remainder of available funding not to exceed the $16 
billion funding limit and funds may prorated if necessary. The payment 
rates will be applied as discussed below.
    For producers of non-specialty crops, an average payment rate per 
unit (bushel, pound, or hundredweight) will be determined for each 
eligible commodity based on the decline in the weekly average of the 
futures prices (or weekly average of the cash prices, if futures prices 
are unavailable) \1\ between the average for the week of January 13-17, 
2020, and the average for the week of April 6-9, 2020.\2\ Only the 
comparison between those two-week periods is used. If the decline in 
futures prices is 5 percent or greater between those time periods, a 
payment for that commodity is triggered and eligible producers are paid 
based on inventory held on January 15, 2020. Eligible inventory for the 
purpose of non-specialty crops is the lower of self-certified unpriced 
inventory that an eligible producer has vested ownership in as of 
January 15, 2020, or 50 percent of the eligible producer's 2019 
production of that commodity. CARES Act funds will be used to make a 
payment for a producer by multiplying 50 percent of the producer's 
eligible inventory on January 15, 2020, by a pre-specified payment rate 
calculated as 50 percent of the calculated futures (or cash, if futures 
are unavailable) price decline. CCC funds will be used to make a 
payment to the producer by multiplying 50 percent of the eligible 
inventory by a pre-specified payment rate calculated as 55 percent of 
the futures (or cash, if futures are unavailable) price decline. These 
two separate payments will be issued as one payment to the eligible 
producer.
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    \1\ Futures market (May contracts quoted on the Chicago Board of 
Trade for all crops other than wheat and cotton. Wheat uses the May 
contract quoted on the Minneapolis Grain Exchange and upland cotton 
uses the May contract quoted on the Intercontinental Exchange. 
Canola uses the May contract on the Intercontinental Exchange in 
Canadian dollars, which are exchanged into U.S. dollars). The price 
for sorghum is calculated as 95 percent of the corn futures price, 
which is consistent with the multiplicative factor used by the Risk 
Management Agency (RMA) under the Commodity Exchange Price 
Provisions (CEPP). The price of durum wheat is calculated as 103.4 
percent of the Hard Red Spring Wheat futures price, which is the 
multiplicative factor used under CEPP for Montana, North Dakota, and 
South Dakota. The price of sunflowers is the soybean oil price 
divided by two plus one cent, which is consistent with the CEPP for 
oil-type sunflowers. AMS data is used for other crops where futures 
contracts are not traded.
    \2\ The futures markets were closed on Friday, April 10, 2020, 
for Good Friday, so the weekly average futures price for the week 
starting on Monday, April 6, 2020, does not include Friday, April 
10, 2020.
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    For producers of specialty crops (including, but not limited to, 
almonds, beans, broccoli, sweet corn, lemons, iceberg lettuce, spinach, 
squash, strawberries, and tomatoes) that incurred a 5-percent-or-
greater reduction in sales price between the average for the week of 
January 13-17, 2020, and the average for the week of April 6-10, 2020, 
payments will be based on the producer's sales (volume) during that 
timeframe multiplied by a pre-specified payment rate calculated as 80 
percent of the given crop's mid-January to mid-April price change. For 
producers of specialty crops that have been shipped from the farm by 
April 15, 2020, but subsequently spoiled due to loss of marketing 
channels, payments will be based on the volume of shipped, spoiled 
crops multiplied by a pre-specified payment rate expected to represent 
30 percent of the crop's sales value. For producers with specialty crop 
shipments that have not left the farm or mature crops that were 
unharvested between January 15, 2020 and April 15, 2020, and which have 
not been and will not be sold, payments will be based on the volume of 
unharvested and/or unshipped crops multiplied by a pre-specified 
payment rate expected to represent 5.875 percent of the crop's value.
    For cattle, hog and pig, and lamb and yearling producers, payments 
will be made using CARES Act funds by multiplying a payment rate per 
head--specified by species and class--by the volume of sales occurring 
between January 15 and April 15, 2020, by the applicable payment rate. 
CCC funds will be used to make a payment to the producer by multiplying 
a payment rate per head--specified by species--by the highest inventory 
number between April 16 and May 14, 2020.
    For producers of wool, a single average payment rate on a clean 
basis per pound will be determined using the Eastern Market Indicator, 
as reported by AMS in the National Wool Review, for the weeks ending 
with January 17, 2020, and April 10, 2020. Only the comparison between 
those two-week periods is used. Producers are paid based on inventory 
held on January 15, 2020. Eligible inventory for the purpose of wool is 
the lower of self-certified unpriced inventory that an eligible 
producer has vested ownership in as of January 15, 2020, or 50 percent 
of the eligible producer's 2019 production of that commodity. CARES Act 
funds will be used to make a payment for a producer by multiplying 50 
percent of the producer's January 15, 2020, eligible inventory, by a 
pre-specified payment rate calculated as 50 percent of the calculated 
price decline. CCC funds will be used to make a payment to the producer 
by multiplying 50 percent of such inventory by a pre-specified payment 
rate calculated as 55 percent of such price decline.
    For dairy producers, payments using funding from the CARES Act will 
be determined by multiplying a producer's milk production for the first 
quarter of calendar year 2020 by a pre-specified payment rate 
calculated as 80 percent of the decline in prices as determined by USDA 
during that quarter. Payments under the CCC Charter Act will be 
determined by multiplying a producer's milk production for the first 
quarter of calendar year 2020 by a factor of 1.014 --in order to 
account for increased

[[Page 30827]]

production in the second quarter of calendar year 2020--by a pre-
specified payment rate calculated as 25 percent of the decline in 
prices as determined by USDA during the first quarter of calendar year 
2020.
    Payments under the CARES Act and CCC Charter Act will be issued as 
one payment to the producer if such producer is eligible to receive 
both parts, and disbursed in a combination of initial and final 
payments as previously described.

Producer Eligibility Requirements

    To be eligible for a CFAP payment, a person or legal entity must:
    (1) Complete a CFAP application form and provide any required 
documentation (as specified in this final rule); and
    (2) Be a producer having a share in the eligible commodity between 
January 15, 2020, and April 15, 2020, or April 16, 2020, through May 
14, 2020.

Average Adjusted Gross Income Limitation and Payment Limitation

    CFAP payments are subject to a per person and legal entity payment 
limitation of $250,000. This limitation applies to the total amount of 
CFAP payments made with respect to all eligible commodities. Similar to 
the manner in which statutory payment limitations are applied in the 
major commodity and disaster assistance programs administered by FSA, 
payments will be attributed to an individual through the direct 
attribution process used in those programs. The total payment amount of 
CFAP payments attributed to an individual will be determined by taking 
into account the direct and indirect ownership interests of the 
individual in all legal entities participating in CFAP.
    Unlike other FSA administered programs, special payment limitation 
rules will be applied to participants that are corporations, limited 
liability companies, and limited partnerships (corporate entities). 
These corporate entities may receive up to $750,000 based upon the 
number of shareholders (not to exceed three shareholders) who are 
contributing substantial labor or management with respect to the 
operation of the corporate entity. For a corporate entity with one such 
shareholder, the payment limit for the entity is $250,000; for a 
corporate entity with two such shareholders, the payment limit for the 
entity is $500,000 if at least two members contribute substantial labor 
or management with respect to the operation of the corporate entity; 
and for a corporate entity with three such shareholders, the limit is 
$750,000 if at least three members contribute substantial labor or 
management with respect to the operation of the corporate entity. If 
payments are calculated for a corporate entity and those payments 
exceed the applicable limit of $250,000, $500,000 or $750,000, the 
reduction will be attributed to all members of the entity to ensure 
that a net payment to the entity is not in excess of the applicable 
limitation. A corporate entity may receive more than $250,000 in CFAP 
payments if the applicant, under penalty of perjury, certifies that two 
or three members of the corporation each provide at least 400 hours of 
active personal management or personal active labor, in which case the 
corporate entity may be eligible to receive up to $500,000 or $750,000, 
respectively.
    A person or legal entity, other than a joint venture or general 
partnership, is ineligible for payments if the person's or legal 
entity's average adjusted gross income (AGI), using the average of the 
adjusted gross incomes for the 2016, 2017 and 2018 tax years, is more 
than $900,000, unless at least 75 percent of that person's or legal 
entity's average AGI is derived from farming, ranching, or forestry-
related activities. If at least 75 percent of the person's or legal 
entity's AGI is derived from farming, ranching, or forestry-related 
activities and the participant provides the required certification and 
documentation, the person or legal entity is eligible to receive CFAP 
payments up to the applicable payment limitation noted above. With 
respect to joint ventures and general partnerships, this AGI provision 
will be applied to each member of the joint venture and general 
partnership.

CFAP General Requirements

    General requirements that apply to other FSA-administered commodity 
programs also apply to CFAP, including compliance with the provisions 
of 7 CFR part 12, ``Highly Erodible Land and Wetland Conservation.''
    The regulations in 7 CFR part 1400, subpart E, are applicable to 
foreign persons and legal entities containing members, stockholders, or 
partners who are foreign persons applying for CFAP. Under the subpart E 
regulations, in order for a foreign person to receive a CFAP payment, 
the person must provide land, capital, and a substantial amount of 
active personal labor to the farming operation. For the purposes for 
this rule, USDA has established that 400 hours of active personal labor 
or active personal management as defined in 7 CFR 1400.3 is considered 
a substantial contribution to the farming operation. If a legal entity 
is owned in whole or in part by a foreign person, then in order for the 
legal entity to receive a payment that is representative of the foreign 
person's interest in the entity, the foreign person must provide a 
substantial amount of active personal labor in the operation of the 
legal entity. Additionally, United States Federal, State, and local 
governments are not eligible for CFAP payments.
    There is no requirement to have crop insurance coverage or coverage 
under the Noninsured Crop Disaster Assistance Program (NAP) for an 
eligible CFAP commodity to be eligible for participation in CFAP.
    Appeal regulations specified in 7 CFR parts 11 and 780 apply to 
determinations under CFAP. The determination of matters of general 
applicability that are not in response to, or result from, an 
individual set of facts in an individual participant's application for 
payment are not matters that can be appealed. Such matters of general 
applicability include, but are not limited to, the determination of 
payment rates and commodities included in CFAP.

Application Process

    USDA will accept CFAP applications beginning May 26, 2020. To apply 
for CFAP payments, producers must submit a completed CFAP application 
either in person, by mail, email, or facsimile to an FSA county office. 
If a producer who applies must submit additional documentation for 
eligibility, such as certifications of compliance with adjusted gross 
income provisions and conservation compliance activities, those 
additional documents and forms must be submitted no later than 60 days 
from the date a producer signs the application. Payments will not be 
made until all necessary eligibility documentation is received, and 
will be reduced or not issued to the individuals or members of the 
entity when the documentation is not submitted timely.
    If supporting documentation is requested to verify the amounts 
specified on the application, the producer must provide records that 
substantiate the reported amounts. The producer's production for the 
commodity, which includes non-specialty crops, dairy, and specialty 
crops, is based on production records. The producer's inventory, which 
includes livestock, non-specialty crops, and wool, is based on 
inventory records. Examples of supporting documentation include 
evidence provided by the producer that is used to substantiate the 
amount of production or inventory reported, including copies of 
receipts,

[[Page 30828]]

ledgers of income, income statements of deposit slips, veterinarian 
records, register tapes, invoices for custom harvesting, and records to 
verify production costs, contemporaneous measurements, truck scale 
tickets, or contemporaneous diaries that are determined acceptable by 
USDA.
    For specialty crops, FSA will process applications from producers 
who experienced loss due to the 5-percent-or-greater reduction in sales 
price. FSA will send some applications to AMS to be spot-checked prior 
to payment. AMS will review the applications and provide payment 
recommendations to FSA.
    The CFAP application period will end August 28, 2020. If any 
supporting documentation or form is required in order to process the 
CFAP application and that documentation or form is not submitted to FSA 
within 60 days of the producer's signature date on the application, the 
CFAP application that had been submitted will not be processed and will 
not be acted on by USDA.

Provisions Requiring Refund to USDA

    In the event that any application for a CFAP payment resulted from 
erroneous information reported by the producer, the payment will be 
recalculated, and the producer must refund any excess payment to USDA. 
If the error was the producer's error, the refund must include interest 
\3\ to be calculated from the date of the disbursement to the producer.
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    \3\ The program interest rate is based on the CCC borrowing rate 
in effect for the month the payment was disbursed. The CCC borrowing 
rate for May is 0.125 percent.
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    If USDA determines that the producer's application misrepresented 
either the total amount or producer's share of the crop, head of 
livestock, or production, or if the CFAP payment would exceed the 
payment as calculated based on the correct amount of production and 
share, the application will be disapproved and the participant must 
refund to USDA all CFAP payments made to the producer with interest 
from the date of disbursement.
    If any corrections to the ownership interest in the crop are made 
and would result in a lower CFAP payment, the producer must refund the 
difference with interest from date of disbursement.
    Any required refunds must be resolved in accordance with debt 
settlement regulations at 7 CFR part 3.

Effective Date and Notice and Comment

    The Administrative Procedure Act (5 U.S.C. 553(a)(2)) provides that 
the notice and comment and 30-day delay in the effective date 
provisions do not apply when the rule involves specified actions, 
including matters relating to benefits. This rule governs CFAP for 
payments to certain commodity producers and therefore falls within that 
exemption.
    The Office of Management and Budget (OMB) designated this rule as 
major under the Congressional Review Act (CRA), as defined by 5 U.S.C. 
804(2). Section 808 of the CRA allows an agency to make a major 
regulation effective immediately if the agency finds there is good 
cause to do so. The beneficiaries of this rule have been significantly 
impacted by the COVID-19 outbreak, which has resulted in income losses 
due to significant declines in demand and market disruptions. USDA 
finds that notice and public procedure are contrary to the public 
interest. Therefore, even though this rule is a major rule for purposes 
of the Congressional Review Act, USDA is not required to delay the 
effective date for 60 days from the date of publication to allow for 
Congressional review. Accordingly, this rule is effective upon 
publication in the Federal Register.

Executive Orders 12866, 13563, and 13777

    Executive Order 12866, ``Regulatory Planning and Review,'' and 
Executive Order 13563, ``Improving Regulation and Regulatory Review,'' 
direct agencies to assess all costs and benefits of available 
regulatory alternatives and, if regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety effects, distributive 
impacts, and equity). Executive Order 13563 emphasizes the importance 
of quantifying both costs and benefits, of reducing costs, of 
harmonizing rules, and of promoting flexibility. The requirements in 
Executive Orders 12866 and 13563 for the analysis of costs and benefits 
apply to rules that are determined to be significant. Further, 
Executive Order 13777, ``Enforcing the Regulatory Reform Agenda,'' 
established a federal policy to alleviate unnecessary regulatory 
burdens on the American people.
    The Office of Management and Budget (OMB) designated this rule as 
economically significant under Executive Order 12866, ``Regulatory 
Planning and Review,'' and therefore, OMB has reviewed this rule. The 
costs and benefits of this rule are summarized below. The full cost 
benefit analysis is available on regulations.gov.

Cost Benefit Analysis Summary

    USDA is implementing CFAP for producers of agricultural commodities 
who have suffered a 5-percent-or-greater price loss due to COVID-19 and 
face additional significant marketing costs associated that are 
eligible for compensation under section 5(b), (d), and (e) of the CCC 
Charter Act for currently held inventories. These additional 
significant marketing costs are associated with lower prices given 
significant declines in demand, surplus production, or by disruptions 
to shipping patterns and the orderly marketing of commodities. Non-
specialty crops eligible for CFAP payments are malting barley, canola, 
corn, upland cotton, millet, oats, soybeans, sorghum, sunflowers, durum 
wheat, and hard red spring wheat. Payments also will be available to 
producers of specialty crops (including, but not limited to, almonds, 
beans, broccoli, sweet corn, lemons, iceberg lettuce, spinach, squash, 
strawberries, and tomatoes) and livestock commodities (including dairy, 
cattle, hogs and pigs, lambs and yearlings, and wool). CFAP eligibility 
for certain other agricultural commodities including agricultural 
commodities for which sufficient information is not currently available 
to USDA may be announced through a NOFA. Approximately 4 percent of the 
CFAP budget--$637 million-- is available to provide assistance to 
producers of other commodities that are identified through the NOFA 
process.
    CFAP will provide producers of agricultural commodities with 
financial assistance that gives them the ability to absorb sales losses 
and increased marketing costs associated with the COVID-19 pandemic. 
Producers will receive payments under the CARES Act, in the amount of 
$9.5 billion, to partially compensate producers for losses due to price 
declines that occurred between mid-January 2020 and mid-April, 2020, 
and for specialty crops that have been shipped from the farm by April 
15th but subsequently spoiled due to loss of marketing channel. 
Producers will also receive payments under sections 5(b), (d), and (e) 
of the CCC Charter Act to partially compensate producers for $6.5 
billion for on-going market disruptions and will assist with the 
transition to a more orderly marketing system as the COVID-19 pandemic 
wanes. CCC funds will assist producers with the purchase of materials 
and facilities required in connection with the production and marketing 
of agricultural commodities and aid in the development of new and

[[Page 30829]]

additional markets, marketing facilities, and uses for such 
commodities.
    For producers of non-specialty crops, a single average payment rate 
per unit (bushel, pound, or hundredweight) will be determined for each 
eligible commodity based on the decline in the average of such futures 
price (or cash price, if futures price is unavailable) using the 
average of such future price for the week of January 13-17, 2020, in a 
comparison with the average of such future price for the week of April 
6-9, 2020. If the decline of such futures price over this time frame is 
5 percent or greater, a payment for that commodity is triggered and 
producers are paid based on unpriced inventory held on January 15, 
2020. For non-specialty crops, inventory held is defined as the lower 
of self-certified unpriced inventory that an eligible producer has 
vested ownership in on January 15, 2020, or 50 percent of the eligible 
producer's 2019 production of that commodity. Payments made under the 
CARES Act will be made by multiplying 50 percent of the producer's 
unpriced inventory held on January 15, 2020, by 50 percent of the 
calculated price decline. Payments made using CCC funds will be 
determined by multiplying 50 percent of the unpriced inventory held on 
January 15, 2020, by 55 percent of the same price decline used with 
respect to payments made using CARES Act's funds. The producer will 
receive one payment consisting of funds made available under the CARES 
Act and the CCC Charter Act.
    For producers of specialty crops (including, but not limited to, 
almonds, beans, broccoli, sweet corn, lemons, iceberg lettuce, spinach, 
squash, strawberries, and tomatoes) that realized a 5-percent-or-
greater reduction in sales price between the average for the week of 
January 13-17, 2020, in a comparison with the average for the week of 
April 6-10, 2020, payments will be based on the grower's sales volume, 
multiplied by 80 percent of the given crop's price change between mid-
January and mid-April 2020. Producers with specialty crops that have 
been shipped from the farm by April 15 but subsequently spoiled due to 
loss of marketing channel and were not paid are eligible to apply for 
up to 30 percent of the crop's sales value of that shipment. The 30 
percent was determined assuming the field value of the crop is 60 
percent of the sales value; the field value is then multiplied by a 50 
percent coverage level. Producers of specialty crop shipments that did 
not leave the farm or mature crops that remained unharvested by April 
15, 2020, are eligible to submit a loss claim for compensation of up to 
5.875 percent of the crop's value. The 5.875 percent is calculated as 
25 percent coverage of the average price loss across specialty crops 
for which data are available.\4\ (That average price loss is 23.5 
percent).
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    \4\ The price data for specialty crops was provided by AMS and 
represents an average of all units shipped of domestic production, 
whether conventional or organic. The raw data source for the prices 
is the AMS Market News Portal, https://www.ams.usda.gov/market-news/fruits-vegetables. The prices are for the shipping point if 
available, or terminal market if not. For any particular crop, 
shipping point and terminal market prices are not mixed. The list of 
crops for which AMS has data for domestic production for the time 
periods of interest is covered by Table 5 in the full cost benefit 
analysis, which is available on regulations.gov in docket FSA-2020-
0004.
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    For dairy, cattle, hogs and pigs, and lambs and yearlings, payments 
will be made in a manner similar to crops--inventory (or sales) of the 
commodity (hundredweight or number of animals) times the payment rate 
per unit for the commodity (again, in a comparison of mid-January to 
mid-April price data). For dairy, CARES Act funds will be used to 
partially compensate producers for price losses from the first quarter 
of calendar year 2020. CCC funds will be used to partially compensate 
for increased marketing and adjustment costs for additional milk 
production in the second quarter of 2020 associated with COVID-19 
disruptions to marketing channels and demand destruction. For hogs and 
pigs, cattle, and lambs and yearlings, payments using CARES Act funds 
are based on actual sales between January 15 to April 15, 2020; 
payments using CCC funds will be based on spring inventories.
    USDA will accept CFAP applications starting on May 26, 2020, and 
payments to eligible producers are expected to be made once 
applications are processed. Total payments to eligible producers, after 
accounting for payment limit reductions, are estimated at $16 billion. 
USDA estimates that payments made using CARES Act funding will total 
$9.5 billion and based upon funds available to CCC on the date of 
issuance of this rule, will total $6.5 billion. The payments represent 
benefits to producers, which is the government cost of CFAP.
    USDA will make an initial payment of 80 percent of an eligible 2020 
CFAP participant's calculated 2020 CFAP payment. By issuing initial 
payments, FSA can quickly provide assistance to those eligible 
participants that immediately apply for assistance while trying to 
ensure that 2020 CFAP payments do not exceed the $16 billion funding 
limit to ensure those funds are distributed equitably among all 
eligible producers. If funds remain available after the initial payment 
to eligible applicants, USDA will disburse the remainder of available 
funding not to exceed the $16 billion funding limit and funds may 
prorated if necessary.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by 
the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA, 
Pub. L. 104-121), generally requires an agency to prepare a regulatory 
flexibility analysis of any rule whenever an agency is required by the 
Administrative Procedure Act or any other law to publish a proposed 
rule, unless the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities. 
This rule is not subject to the Regulatory Flexibility Act because USDA 
is not required by the Administrative Procedure Act or any other law to 
publish a proposed rule for this rulemaking initiative.

Environmental Review

    The environmental impacts of this final rule have been considered 
in a manner consistent with the provisions of the National 
Environmental Policy Act (NEPA), the regulations of the Council on 
Environmental Quality (40 CFR parts 1500-1508), and because USDA will 
be making the payments to producers the USDA regulations for compliance 
with NEPA (7 CFR part 1b).
    Although OMB has designated this rule as ``economically 
significant'' under Executive Order 12866, ``. . . economic or social 
effects are not intended by themselves to require preparation of an 
environmental impact statement'' when not interrelated to natural or 
physical environmental effects (see 40 CFR 1508.14). CFAP was designed 
to avoid skewing planting decisions. Producers continue to make their 
planting and production decisions with the market signals in mind, 
rather than any expectation of what a new USDA program might look like. 
The discretionary aspects of CFAP (for example, determining AGI and 
payment limitations) were designed to be consistent with established 
USDA and CCC programs and are not expected to have any impact on the 
human environment, as CFAP payments will only be made after the 
commodity has been produced. Accordingly, the following Categorical 
Exclusion in 7 CFR part 1b applies: Sec.  1b.3(a)(2), which applies to 
activities that deal solely with the funding of programs, such as 
program budget proposals, disbursements, and the transfer or

[[Page 30830]]

reprogramming of funds. As such, the implementation of and 
participation in CFAP do not constitute major Federal actions that 
would significantly affect the quality of the human environment, 
individually or cumulatively. Therefore, an environmental assessment or 
environmental impact statement for this regulatory action, will not be 
prepared; this rule serves as documentation of the programmatic 
environmental compliance decision for this Federal action.

Executive Order 12372

    Executive Order 12372, ``Intergovernmental Review of Federal 
Programs,'' requires consultation with State and local officials that 
would be directly affect by proposed Federal financial assistance. The 
objectives of the Executive Order are to foster an intergovernmental 
partnership and a strengthened Federalism, by relying on State and 
local processes for State and local government coordination and review 
of proposed Federal Financial assistance and direct Federal 
development. For reasons specified in the final rule related notice to 
7 CFR part 3015, subpart V (48 FR 29115, June 24, 1983), the programs 
and activities within this rule are excluded from the scope of 
Executive Order 12372, which requires intergovernmental consultation 
with State and local officials.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, ``Civil 
Justice Reform.'' This rule will not preempt State or local laws, 
regulations, or policies unless they represent an irreconcilable 
conflict with this rule. The rule will not have retroactive effect. 
Before any judicial action may be brought regarding the provisions of 
this rule, the administrative appeal provisions of 7 CFR parts 11 and 
780 must be exhausted.

Executive Order 13132

    This rule has been reviewed under Executive Order 13132, 
``Federalism.'' The policies contained in this rule do not have any 
substantial direct effect on States, on the relationship between the 
Federal Government and the States, or on the distribution of power and 
responsibilities among the various levels of government, except as 
required by law. Nor does this rule impose substantial direct 
compliance costs on State and local governments. Therefore, 
consultation with the States is not required.

Executive Order 13175

    This rule has been reviewed for compliance with Executive Order 
13175, ``Consultation and Coordination with Indian Tribal 
Governments.'' Executive Order 13175 requires Federal agencies to 
consult and coordinate with Tribes on a government-to-government basis 
on policies that have Tribal implications, including regulations, 
legislative comments proposed legislation, and other policy statements 
or actions that have substantial direct effects on one or more Indian 
Tribes, on the relationship between the Federal Government and Indian 
Tribes or on the distribution of power and responsibilities between the 
Federal Government and Indian Tribes.
    USDA has assessed the impact of this rule on Indian Tribes and 
determined that this rule does not, to our knowledge, have Tribal 
implications that required Tribal consultation under Executive Order 
13175. If a Tribe requests consultation, the USDA Office of Tribal 
Relations (OTR) will ensure meaningful consultation is provided where 
changes, additions, and modifications are not expressly mandated by 
Congress.
    Outside of Tribal consultation, USDA is working with Tribes to 
provide information about CFAP and other issues. Specifically, to date, 
USDA held a call with Navajo Nation on Tuesday, May 12, 2020; CFAP was 
one of the items presented--there were no questions raised about CFAP. 
OTR will host a listening session between FSA, AMS, and Tribal leaders 
on Thursday, May 21, 2020, at 3:00 p.m.

The Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA, Pub. L. 
104-4) requires Federal agencies to assess the effects of their 
regulatory actions on State local, and Tribal governments or the 
private sector. Agencies generally must prepare a written statement, 
including a cost benefit analysis, for proposed and final rules with 
Federal mandates that may result in expenditures of $100 million or 
more in any 1 year for State, local, or Tribal governments, in the 
aggregate, or to the private sector. UMRA generally requires agencies 
to consider alternatives and adopt the more cost effective or least 
burdensome alternative that achieves the objectives of the rule. This 
rule contains no Federal mandates, as defined in Title II of UMRA, for 
State, local, and Tribal governments or the private sector. Therefore, 
this rule is not subject to the requirements of sections 202 and 205 of 
UMRA.

Federal Assistance Programs

    The title and number of the Federal Domestic Assistance Program 
found in the Catalog of Federal Domestic Assistance to which this rule 
applies is Coronavirus Food Assistance Program and 10.130.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995, the 
following new information collection request that supports CFAP was 
submitted to OMB for emergency approval. OMB approved the 6-month 
emergency information collection. A request for comments on the 
information collection will be included in the NOFA issued subsequent 
to this rule.

E-Government Act Compliance

    USDA is committed to complying with the E-Government Act to promote 
the use of the internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.

List of Subjects in 7 CFR Part 9

    Agricultural commodities, Agriculture, Disaster assistance, 
Indemnity payments.

0
For the reasons discussed above, USDA adds part 9 to title 7 of the 
Code of Federal Regulations to read as follows:

PART 9--CORONAVIRUS FOOD ASSISTANCE PROGRAM

Sec.
9.1 Applicability and administration.
9.2 Definitions.
9.3 Producer eligibility requirements.
9.4 Time and method of application.
9.5 Calculation of payments.
9.6 Eligibility subject to verification.
9.7 Miscellaneous provisions.
9.8 Perjury.

    Authority: 15 U.S.C. 714b and 714c; and Division B, Title I, 
Pub. L. 116-136.


Sec.  9.1   Applicability and administration.

    (a) This part specifies the eligibility requirements and payment 
calculations for the Coronavirus Food Assistance Program (CFAP). CFAP 
will provide payments with respect to commodities that have been 
significantly impacted by the effects of the COVID-19 outbreak. 
Payments will be made with respect to only commodities produced in the 
United States; commodities imported into the United States may not be 
used to determine any payment made under this part.

[[Page 30831]]

    (b) The program is administered under the general supervision and 
direction of the Administrator, Farm Service Agency (FSA) with the 
assistance of the Agricultural Marketing Service (AMS).
    (c) The FSA State committee will take any action required by this 
part that an FSA county committee has not taken. The FSA State 
committee will also:
    (1) Correct, or require an FSA county committee to correct, any 
action taken by such county FSA committee that is not in accordance 
with the regulations of this part; or
    (2) Require an FSA county committee to withhold taking any action 
that is not in accordance with this part.
    (d) No provision or delegation to an FSA State or county committee 
will preclude the FSA Administrator, the Deputy Administrator, or a 
designee or other such person, from determining any question arising 
under the programs of this part, or from reversing or modifying any 
determination made by an FSA State or county committee.


Sec.  9.2   Definitions.

    The following definitions apply to CFAP. The definitions in parts 
718 and 1400 of this title apply, except where they conflict with the 
definitions in this section.
    All other cattle means commercially raised or maintained bovine 
animals not meeting the definition of another category of cattle in 
this part excluding beefalo, bison, and animals used for dairy 
production or intended for dairy production.
    AMS means USDA's Agricultural Marketing Service.
    Application means the CFAP application form.
    Aquaculture means only those species as announced in a NOFA.
    Cattle means commercially raised or maintained bovine animals, 
excluding beefalo, bison, and animals used for dairy production or 
intended for dairy production.
    Cattle raised or maintained for breeding purposes means animals 
commercially raised or maintained for use as either a sire or dam for 
the production of livestock offspring or lactation.
    Commodity means an agricultural commodity produced in the United 
States and intended to be marketed for commercial production that has 
been designated as eligible for payments under CFAP.
    Crop means non-specialty crops and specialty crops.
    Feeder cattle 600 pounds or more means cattle weighing more than 
600 pounds but less than the weight of slaughter cattle-fed cattle as 
defined in this section.
    Feeder cattle less than 600 pounds means cattle weighing less than 
600 pounds.
    First quarter means January, February, and March of 2020.
    Foreign entity means a corporation, trust, estate, or other similar 
organization that has more than 10 percent of its beneficial interest 
held by individuals who are not:
    (1) Citizens of the United States; or
    (2) Lawful aliens possessing a valid Alien Registration Receipt 
Card.
    Foreign person means any person who is not a citizen or national of 
the United States or who is admitted into the United States for 
permanent residence under the Immigration and Nationality Act and 
possesses a valid Alien Registration Receipt Card issued by the United 
States Citizenship and Immigration Services, Department of Homeland 
Security.
    Hogs means any swine 120 pounds or more.
    Lambs and yearlings means all sheep less than 2 years old.
    NOFA means a Notice of Funding Availability under this part 
published in the Federal Register.
    Non-specialty crop means any of the following crops: Malting 
barley, canola, corn, upland cotton, millet, oats, sorghum, soybeans, 
sunflowers, durum wheat, hard red spring wheat, and any crops announced 
in a NOFA. The term excludes crops intended for grazing.
    Pigs means any swine weighing less than 120 pounds.
    Producer means a person or legal entity who shares in the risk of 
producing a crop or livestock and who is entitled to a share in the 
crop or livestock available for marketing or would have shared had the 
crop or livestock been produced and marketed. A contract grower who 
does not own the livestock, will be considered a producer if the 
contract allows the grower to have risk in the livestock.
    Slaughter Cattle--fed cattle means cattle with an average weight in 
excess of 1,400 pounds which yield average carcass weights in excess of 
800 pounds and are intended for slaughter.
    Slaughter cattle--mature cattle means culled cattle raised or 
maintained for breeding purposes, but which were removed from inventory 
and are intended for slaughter.
    Specialty crops means any of the following crops: Almonds; apples; 
artichokes; asparagus; avocados; beans; blueberries; broccoli; cabbage; 
cantaloupe; carrots; cauliflower; celery; corn, sweet; cucumbers, 
eggplant; garlic; grapefruit; kiwifruit; lemons; lettuce, iceberg; 
lettuce, romaine; mushrooms; onions, dry; onions, green; oranges; 
papayas; peaches; pears; pecans; peppers, bell type; peppers, other; 
potatoes; raspberries; rhubarb; spinach; squash; strawberries; sweet 
potatoes; tangerines; taro; tomatoes; walnuts; watermelons; and any 
crops for which funds are made available and announced in a NOFA. The 
term excludes crops intended for grazing.
    Unpriced inventory means any production that is not subject to an 
agreed-upon price in the future through a forward contract, agreement, 
or similar binding document.
    Wool means the fiber sheared from a live sheep and includes, unless 
noted otherwise, graded and nongraded wool. Graded wool is paid on a 
clean basis, and ungraded wool is paid on a greasy basis.


Sec.  9.3   Producer eligibility requirements.

    To be eligible for a CFAP payment, a producer must:
    (a) Meet all of the requirements in this part;
    (b) Be a:
    (1) Citizen of the United States;
    (2) Resident alien, which for purposes of this part means ``lawful 
alien'' as defined in part 1400 of this title;
    (3) Partnership of citizens of the United States;
    (4) Corporation, limited liability company, or other organizational 
structure organized under State law;
    (5) Indian Tribe or Tribal organization, as defined in section 4(b) 
of the Indian Self-Determination and Education Assistance Act (25 
U.S.C. 5304); or
    (6) Foreign person or foreign entity who meets all requirements as 
described in part 1400 of this title; and
    (c) Have had a share in the eligible commodity on January 15, 2020, 
or April 16, 2020, through May 14, 2020.


Sec.  9.4   Time and method of application.

    (a) An application under this subpart must be submitted in person, 
by mail, email, or facsimile to any FSA county office by the close of 
business on August 28, 2020.
    (b) Failure of an individual, entity, or a member of an entity to 
submit the following payment limitation and payment eligibility forms 
within 60-days from the date of signing the CFAP application, may 
result in no payment or a reduced payment:
    (1) A farm operating plan for an individual or legal entity as 
provided in part 1400 of this title;
    (2) Form CCC-901 Member Information for Legal Entities (if 
applicable);

[[Page 30832]]

    (3) An average adjusted gross income statement for the 2020 program 
year for the person or legal entity, including the legal entity's 
members, partners, or shareholders, as provided in part 1400 of this 
title; form CCC-941 Average Adjusted Gross Income (AGI) Certification 
and Consent to Disclosure of Tax Information;
    (4) CCC-942 Certification of Income From Farming, Ranching and 
Forestry Operations (optional); and
    (5) A highly erodible land conservation (sometimes referred to 
elsewhere as HELC) and wetland conservation certification as provided 
in part 12 of this title (form AD-1026 Highly Erodible Land 
Conservation (HELC) and Wetland Conservation (WC) Certification for 
CFAP applicant and applicable affiliates).
    (c) If requested by USDA, the applicant must provide documentation 
that:
    (1) Establishes the applicant's ability and intent to harvest, 
transport, and market the commodity for the intended market or crop's 
expected production in a quantity determined based on the producer's 
approved yield, expected level of production, or inventory of the 
livestock, crop, or commodity;
    (2) Establishes the applicant's ownership share in the commodity; 
and
    (3) Establishes the applicant's value at risk in the commodity.


Sec.  9.5   Calculation of payments.

    (a) Payments for eligible non-specialty crops will be the sum of:
    (1) Unpriced inventory that is harvested but held in inventory as 
of January 15, 2020, not to exceed 50 percent of 2019 total production, 
multiplied by 50 percent, multiplied by the Coronavirus Aid, Relief, 
and Economic Stability Act (CARES Act) payment rate in paragraph (h) of 
this section; and
    (2) Unpriced inventory as of January 15, 2020, not to exceed 50 
percent of 2019 total production, multiplied by 50 percent, multiplied 
by the Commodity Credit Corporation (CCC) payment rate in paragraph (h) 
of this section.
    (b) Payments for eligible specialty crops will be the sum of:
    (1) For specialty crops listed in paragraph (h) of this section 
that were sold between January 15, 2020, and April 15, 2020, the 
quantity sold multiplied by the payment rate in column 2 of Table 1 in 
paragraph (h) of this section;
    (2) For specialty crops harvested and shipped but subsequently 
spoiled due to loss of marketing channels between January 15, 2020, and 
April 15, 2020, the harvested and shipped quantity that spoiled 
multiplied by the payment rate in column 3 of Table 1 in paragraph (h) 
of this section; and
    (3) For unpriced specialty crops that did not leave the farm or 
mature crops that remained unharvested between January 15, 2020 and 
April 15, 2020 due to loss of marketing channel, the sum of the 
quantity of crops that did not leave the farm and the quantity of 
mature crops that remained unharvested, multiplied by the payment rate 
in column 4 of Table 1 in paragraph (h) of this section.
    (c) Payments for cattle will be the sum of the results of the 
following two calculations:
    (1) Cattle sold between January 15, 2020, to April 15, 2020, 
multiplied by the CARES Act payment rate in paragraph (h) of this 
section; and
    (2) Unpriced cattle inventory between April 16, 2020, to May 14, 
2020, multiplied by the CCC payment rate in paragraph (h) of this 
section.
    (d) Payments for hogs and pigs will be equal to the sum of the 
results of the following two calculations:
    (1) Hogs and pigs sold between January 15, 2020, to April 15, 2020, 
multiplied by the CARES Act payment rate in paragraph (h) of this 
section; and
    (2) Unpriced hog and pig inventory between April 16, 2020, to May 
14, 2020, multiplied by the CCC payment rate in paragraph (h) of this 
section.
    (e) Payments for dairy will be equal to the sum of the results of 
the following two calculations:
    (1) First quarter production, multiplied by the CARES Act payment 
rate in paragraph (h) of this section; and
    (2) First quarter production, multiplied by 1.014, multiplied by 
the CCC payment rate in paragraph (h) of this section.
    (f) Payments for lambs and yearlings will be equal to the sum of 
the results of the following two calculations:
    (1) Lambs and yearlings sold between January 15, 2020, to April 15, 
2020, multiplied by the CARES Act payment rate in paragraph (h) of this 
section; and
    (2) Unpriced lambs and yearlings in inventory between April 16, 
2020, to May 14, 2020, multiplied by the CCC payment rate in paragraph 
(h) of this section.
    (g) Payments for wool are the sum of:
    (1) Unpriced inventory on January 15, 2020, not to exceed 50 
percent of 2019 total production, multiplied by 50 percent, multiplied 
by the CARES Act payment rate paragraph (h) of this section; and
    (2) Unpriced inventory on January 15, 2020, not to exceed 50 
percent of 2019 total production, multiplied by 50 percent, multiplied 
by the CCC payment rate in paragraph (h) of this section.
    (h) The payment rates in Tables 1 and 2 of this paragraph (h) will 
be used to calculate CFAP payments:

                           Table 1 to Paragraph (h)--Payment Rates for Specialty Crops
                             [Including, but not limited to, the listed commodities]
----------------------------------------------------------------------------------------------------------------
                                                                 CARES Act payment rate
                                                                 for product that left
                                        CARES Act payment rate    the farm but spoiled
              Commodity                for sales losses ($/lb)       due to loss of      CCC Payment rate ($/lb)
                                                                 marketing channel ($/
                                                                          lb)
----------------------------------------------------------------------------------------------------------------
Almonds..............................                    $0.26                    $0.57                    $0.11
Apples...............................  .......................                     0.18                     0.03
Artichokes...........................                     0.66                     0.49                     0.10
Asparagus............................  .......................                     0.38                     0.07
Avocados.............................  .......................                     0.14                     0.03
Beans................................                     0.17                     0.16                     0.03
Blueberries..........................  .......................                     0.62                     0.12
Broccoli.............................                     0.62                     0.49                     0.10
Cabbage..............................                     0.04                     0.07                     0.01
Cantaloupe...........................  .......................                     0.10                     0.02
Carrots..............................                      0.2                     0.11                     0.02
Cauliflower..........................                     0.11                     0.31                     0.06

[[Page 30833]]

 
Celery...............................  .......................                     0.07                     0.01
Corn, sweet..........................                     0.09                     0.13                     0.03
Cucumbers............................                     0.13                     0.15                     0.03
Eggplant.............................                     0.07                     0.15                     0.03
Garlic...............................  .......................                     0.85                     0.17
Grapefruit...........................  .......................                     0.11                     0.02
Kiwifruit............................  .......................                     0.32                     0.06
Lemons...............................                     0.08                     0.21                     0.04
Lettuce, iceberg.....................                     0.20                     0.15                     0.03
Lettuce, romaine.....................                     0.07                     0.12                     0.02
Mushrooms............................  .......................                     0.59                     0.11
Onions, dry..........................                     0.01                     0.05                     0.01
Onions green.........................  .......................                     0.30                     0.06
Oranges..............................  .......................                     0.14                     0.03
Papaya...............................  .......................                     0.32                     0.06
Peaches..............................                     0.08                     0.32                     0.06
Pears................................                     0.08                     0.18                     0.03
Pecans...............................                     0.28                     0.93                     0.18
Peppers, bell type...................                     0.14                     0.22                     0.04
Peppers, other.......................                     0.15                     0.22                     0.04
Potatoes.............................  .......................                     0.04                     0.01
Raspberries..........................  .......................                     1.45                     0.28
Rhubarb..............................                     0.15                     1.03                     0.20
Spinach..............................                     0.37                     0.37                     0.07
Squash...............................                     0.72                     0.39                     0.08
Strawberries.........................                     0.84                     0.72                     0.14
Sweet potatoes.......................  .......................                     0.18                     0.04
Tangerines...........................  .......................                     0.22                     0.04
Taro.................................  .......................                     0.23                     0.05
Tomatoes.............................                     0.64                     0.38                     0.07
Walnuts..............................  .......................                     0.45                     0.09
Watermelons..........................  .......................                     0.02  .......................
----------------------------------------------------------------------------------------------------------------


              Table 2 to Paragraph (h)--Payment Rates for Non-Specialty Crops, Dairy, and Livestock
----------------------------------------------------------------------------------------------------------------
                                                                                CARES Act
               Commodity                                Unit                 payment rate ($/   CCC payment rate
                                                                                  unit)             ($/unit)
----------------------------------------------------------------------------------------------------------------
Barley (malting).......................  bu...............................               0.34               0.37
Canola.................................  lb...............................               0.01               0.01
Corn...................................  bu...............................               0.32               0.35
Durum wheat............................  bu...............................               0.19               0.20
Hard red spring wheat..................  bu...............................               0.18               0.20
Millet.................................  bu...............................               0.31               0.34
Oats...................................  bu...............................               0.15               0.17
Sorghum................................  bu...............................               0.30               0.32
Soybeans...............................  bu...............................               0.45               0.50
Sunflowers.............................  lb...............................               0.02               0.02
Upland cotton..........................  lb...............................               0.09               0.10
Dairy..................................  cwt..............................               4.71               1.47
Slaughter cattle--mature cattle........  head.............................                 92                 33
Slaughter cattle--fed cattle...........  head.............................                214                 33
Feeder cattle less than 600 pounds.....  head.............................                102                 33
Feeder cattle 600 pounds or more.......  head.............................                139                 33
All other cattle.......................  head.............................                102                 33
Pigs...................................  head.............................                 28                 17
Hogs...................................  head.............................                 18                 17
Lambs and yearlings....................  head.............................                 33                  7
Wool (graded, clean basis).............  lb...............................               0.71               0.78
Wool (non-graded, greasy basis)........  lb...............................               0.36               0.39
----------------------------------------------------------------------------------------------------------------


[[Page 30834]]

    (i) Payments for cattle and hogs will be calculated separately for 
the following categories:
    (1) Slaughter cattle--mature cattle;
    (2) Slaughter cattle--fed cattle;
    (3) Feeder cattle less than 600 pounds;
    (4) Feeder cattle 600 pounds or more;
    (5) All other cattle;
    (6) Pigs; and
    (7) Hogs.
    (j)(1) USDA may make payments with respect to other commodities. In 
order to determine whether other commodities will be included in CFAP, 
a notice will be issued that will specify the types of market 
information the public may submit for consideration by USDA. After 
receipt of the information and the use of other related information 
available to USDA, a NOFA will specify the other eligible commodities 
and the manner in which payments will be determined.
    (2) Producers that are privately owned aquaculture businesses 
growing freshwater and saltwater products in controlled environments, 
including raceways, ponds, tanks, and recirculating systems, extending 
to all farmed shrimp and salmonids (trout and salmon) are included in 
CFAP to the extent USDA determines individual types of the products 
have incurred a decline in prices of 5 percent or more between January 
15, 2020, and April 15, 2020. The determination of which species are 
included will be specified in the NOFA referenced in paragraph (j)(1) 
of this section.
    (k) An initial payment will be issued for 80 percent of each CFAP 
payment calculated. A final payment will be issued on a date determined 
by the Secretary, to the extent such funds are available. The total of 
all CFAP payments made, including all initial and final payments, 
cannot exceed a total of $9.5 billion for CARES Act funds and $6.5 
billion for CCC funds.


Sec.  9.6   Eligibility subject to verification.

    (a) Producers who are approved for participation in CFAP are 
required to retain documentation in support of their application for 3 
years after the date of approval.
    (b) Participants receiving CFAP payments or any other person who 
furnishes such information to USDA must permit authorized 
representatives of USDA or the Government Accountability Office, during 
regular business hours, to enter the agricultural operation and to 
inspect, examine, and to allow representatives to make copies of books, 
records, or other items for the purpose of confirming the accuracy of 
the information provided by the participant.


Sec.  9.7   Miscellaneous provisions.

    (a) If a CFAP payment resulted from erroneous information provided 
by a participant, or any person acting on their behalf, the payment 
will be recalculated and the participant must refund any excess payment 
with interest calculated from the date of the disbursement of the 
payment. Any required refunds must be resolved in accordance with part 
3 of this title.
    (b) The regulations in parts 11 and 780 of this title apply to 
determinations made under this part.
    (c) Any payment under this part will be made without regard to 
questions of title under State law and without regard to any claim or 
lien against the commodity or proceeds from the sale of the commodity. 
The regulations governing offsets in part 3 of this title do not apply 
to payments made under this part.
    (d) The $900,000 average AGI limitation provisions in part 1400 of 
this title relating to limits on payments for persons or legal 
entities, excluding joint ventures and general partnerships, apply to 
each applicant for CFAP unless at least 75 percent of the person or 
legal entity's average AGI is derived from farming, ranching, or 
forestry-related activities. The average AGI will be calculated for a 
person or such legal entity based on the 2016, 2017, and 2018 tax 
years. If the person or such legal entity's average AGI is below 
$900,000 or at least 75 percent of the person or legal entity's average 
AGI is derived from farming, ranching, or forestry-related activities, 
the person or legal entity, is eligible to receive payments under this 
part.
    (e)(1) The total amount of CFAP payments that a program applicant 
who is an individual may receive directly or through the attribution of 
payments as provided in paragraph (e)(3) of this section is $250,000. 
The total amount of payments that a program applicant who is a legal 
entity created under State law may receive is $250,000, except as 
provided in paragraph (e)(2) of this section. Payments made to a 
program applicant who is a joint venture or a general partnership are 
limited to the aggregated amount of payments that individual or legal 
entity members of the joint venture or general partnership may 
otherwise receive.
    (2)(i) The total amount of CFAP payments a corporation, limited 
liability company, or a limited partnership may receive is $250,000 
unless the owners of the legal entity meet the provisions of paragraphs 
(e)(2)(ii) and (iii) of this section.
    (ii) The total amount of CFAP payments a corporation, limited 
liability company, or a limited partnership may receive is $500,000 if 
two different individual owners of the legal entity each provided at 
least 400 hours of active personal labor or active personal management 
or combination thereof with respect to the production of 2019 
commodities for which an application or applications are made in 
accordance with this part.
    (iii) The total amount of CFAP payments a corporation, limited 
liability company, or a limited partnership may receive is $750,000 if 
three different individual owners of the legal entity each provided at 
least 400 hours of active personal labor or active personal management 
or combination thereof with respect to the production of 2019 
commodities for which an application or applications are made in 
accordance with this part.
    (3) In accordance with Sec.  1400.105 of this title, a CFAP payment 
made to any legal entity will be attributed to individuals or legal 
entities with an ownership interest in the legal entity. Payments 
attributed to a legal entity with an ownership interest in the legal 
entity will be further attributed as provided in Sec.  1400.105 of this 
title. If the total amount of CFAP payments made directly or indirectly 
to an individual or legal entity has met the applicable amounts 
specified in paragraphs (e)(1) and (2) of this section, the payment to 
the legal entity will be reduced commensurate with the amount of the 
ownership interest of the individual or legal entity in the legal 
entity. CFAP payments will be attributed to individuals and legal 
entities until the attribution is made only to an individual except the 
attribution will stop at the fourth level of ownership.
    (4) If an individual or legal entity is not eligible to receive 
CFAP payments due to the individual or legal entity failing to satisfy 
some other payment eligibility provision such as AGI in or conservation 
compliance provisions or some other payment eligibility impediment, the 
payment made either directly or indirectly to the individual or legal 
entity will be reduced to zero. The amount of the reduction for the 
direct payment to the applicant will be commensurate with the direct or 
indirect ownership interest of the ineligible individual or ineligible 
legal entity. The application of this ineligibility to receive a CFAP 
payment due to the excessive AGI of an individual or legal entity will 
stop at the fourth level of ownership.
    (f) For the purposes of the effect of a lien on eligibility for 
Federal programs (28 U.S.C. 3201(e)), USDA waives the

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restriction on receipt of funds under CFAP but only as to beneficiaries 
who, as a condition of the waiver, agree to apply the CFAP payments to 
reduce the amount of the judgment lien.
    (g) In addition to any other Federal laws that apply to CFAP, the 
following laws apply: 15 U.S.C. 714; 18 U.S.C. 286, 287, 371, 1001; and 
31 U.S.C. 1001.
    (h) This part applies to applications submitted under CFAP through 
August 28, 2020, or until funds made available for CFAP are exhausted.


Sec.  9.8   Perjury.

    In either applying for or participating in CFAP, or both, the 
producer is subject to laws against perjury and any penalties and 
prosecution resulting therefrom, with such laws including but not 
limited to 18 U.S.C. 1621. If the producer willfully makes and 
represents as true any verbal or written declaration, certification, 
statement, or verification that the producer knows or believes not to 
be true, in the course of either applying for or participating in CFAP, 
or both, then the producer is guilty of perjury and, except as 
otherwise provided by law, may be fined, imprisoned for not more than 5 
years, or both, regardless of whether the producer makes such verbal or 
written declaration, certification, statement, or verification within 
or without the United States.

Stephen L. Censky,
Vice Chairman, Commodity Credit Corporation, and Deputy Secretary, U.S. 
Department of Agriculture.
[FR Doc. 2020-11025 Filed 5-20-20; 8:45 am]
 BILLING CODE 3410-05-P