Gov’t Shutdown Halts Some Payments, Loans to Farmers

Reuters’ Leah Douglas, P.J. Huffstutter, and Julie Ingwersen reported that “the U.S. federal government shutdown that began Wednesday will halt some payments to farmers and delay access to federal farm loans, the latest blow for producers already facing low crop prices, record-high debts, and a trade war at the height of the fall harvest.”

“The shutdown began at midnight after Republican and Democratic lawmakers could not agree on a plan to fund federal government operations. It will last until one party gets enough votes for its funding plan,” Douglas, Huffstutter, and Ingwersen reported. “On Wednesday, the scope of the shutdown’s potential impact to U.S. farmers was beginning to emerge. Even short interruptions in payments could deepen farmers’ economic turmoil. ‘It costs money to run those combines,’ said Chad Hart, agricultural economist with Iowa State University.”

“Plans show the USDA will continue some operations deemed mission-critical, like administration of nutrition programs and food inspections,” Douglas, Huffstutter, and Ingwersen reported. “But much of its other work will cease, such as processing of farm loans and making payments to farmers, including billions of dollars in disaster aid contained in President Donald Trump’s tax-cut and spending bill.”

“The USDA has stopped issuing weather-related disaster payments, accepting and processing farm loans, providing technical assistance for conservation programs, and swaths of other agency work, the agency shutdown plan said,” Douglas, Huffstutter, and Ingwersen reported. “It will also not process annual commodity and land conservation payments, typically issued by or in October, or advance money for loans the agency has already approved, according to the plan.”

“The USDA was in the process of issuing the last round of payments to farmers from the $10 billion Emergency Commodity Assistance Program, a one-time economic assistance payment to some commodity farmers, in the days before the shutdown,” Douglas, Huffstutter, and Ingwersen reported. “The timing of this shutdown is particularly disruptive because farmers often rely on USDA loans to pay for machinery, fertilizer, and other expenses during harvest season, said economist Hart.”

Farmer Facing Agencies Hit Hard by Furloughs

Progressive Farmer’s Chris Clayton reported that “all told, USDA will furlough 42,256 employees out of 85,907 total employees across the department. The lion’s share of employees remaining are classified as necessary to protect life and property. Most of the employees remaining will be at the U.S. Forest Service, the Food Safety and Inspection Service (FSIS), and the Animal and Plant Health Inspection Service (APHIS).”

“At the Farm Service Agency (FSA), 6,377 staff in county offices across the country will be furloughed,” Clayton reported. “FSA stops processing payments under the Emergency Commodity Assistance Program (ECAP) and the Supplemental Disaster Assistance Program, as well as payments under ARC/PLC and the Conservation Reserve Program (CRP).”

“At the Natural Resources Conservation Service (NRCS), 8,849 employees will be furloughed, leaving fewer than 500 NRCS staff working during the shutdown. All technical assistance is halted. Dam safety and rehabilitation duties continue because they affect life and safety,” Clayton reported. “…At Rural Development, 2,640 staff will be furloughed. The majority of the agency’s work is suspended.”

Where the Shutdown Stands

CNBC’s Erin Doherty reported that “the government shutdown is likely to drag on for at least three days, with the Senate set to be out of session (today) in observance of Yom Kippur.”

“Senators are not expected to vote again until Friday, more than two days after the shutdown began, NBC News reported,” according to Doherty. “Lawmakers are still at an impasse over a deal to fund the government.”

Gov’t Shutdown Halts Some Payments, Loans to Farmers was originally published by Farmdoc.