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Progress in SBA Support for Farmers, NMPF Continues Efforts

May 1, 2020

Dairy producers were aided in  their rush to participate in two Small Business Administration (SBA) loan programs by NMPF resources that helped guide them through an intense crunch for signups.

With additional funding, the Paycheck Protection Program (PPP) and  Coronavirus-specific Economic Injury Disaster Loans (EIDL) both reopened early the week of April 27. NMPF provided an updated coronavirus webpage tailored to meet producers’ questions and needs, assisting them in gaining necessary government relief at a time of unprecedented demand.

Most agricultural producers, including dairy farmers, had not been able to access SBA loans before the pandemic. When passing the CARES Act on March 27, Congress created PPP and expanded eligibility for EIDLs specific to COVID-19, allowing access to both PPP and COVID-19 EIDLs for agriculture and other types of businesses and organizations typically excluded from SBA programs.

Participation in the first round of assistance, which was exhausted in early April, posed immense challenges for dairy producers and American agriculture due to how the programs were rolled out. The Small Business Administration did not interpret the CARES Act to allow farmers to access EIDLs, and producers across the U.S. were put at a deep disadvantage when trying to apply for PPP loans because of how SBA implemented the program.

NMPF joined other key stakeholder organizations in leading the charge to get farmers equitable access to the small business support, working with members of Congress from both parties and Administration officials to bring the reality of PPP and EIDLs in-line with congressional intent in the CARES Act.

Due to this determined collaborative work, a second bill signed April 23 provided additional funding for PPP and COVID-19 EIDLs and changed how the programs are administered moving forward. Congress explicitly stated in the measure that agricultural producers with 500 or fewer employees can access EIDLs and set aside $60 billion of the newly allocated PPP funds for smaller lending institutions, including community banks and credit unions.

“NMPF is extremely pleased that Congress makes it clear in this bill that farmers with 500 or fewer employees should be able to access COVID-19 EIDLs, removing a significant obstacle that has prevented small business support from reaching America’s farmers,” NMPF president and CEO Jim Mulhern said. “On the PPP side, we are hopeful that the measure’s provisions aimed at ensuring small lenders – including community banks and credit unions – have adequate access to PPP funds will make it easier for dairy producers and others in rural areas to apply for support.”

Mulhern thanked NMPF’s champions in Congress and their staff for their work securing these changes to the SBA programs in the legislation, but noted some obstacles still remain, including challenges family farms and other sole proprietors face in SBA’s application process. “NMPF will continue efforts to address remaining problems so farmers are better enabled to fulfill their critical role in helping our nation throughout this pandemic.”