While the Senate Health, Economic Aid, Liability Protection, and Schools Act would help more farmers and ranchers participate in the Paycheck Protection Program, the American Farm Bureau Federation is calling to additional changes to make PPP truly usable for people involved in agriculture.
When drafting their follow-up to the CARES Act, Senate Republicans included the Farm Bureau-backed Producer Paycheck Protection Act, which would allow farmers and ranchers who file a Schedule F to apply. a loan based on 2019 gross receipts, rather than net. profits.
Allowing farmers to apply for PPP loans on the basis of 2019 gross receipts will significantly expand the eligibility pool, AFBF Chairman Zippy Duvall said in a letter to Senate Majority Leader Mitch McConnell (R-Ky.), Senate Minority Leader Chuck Schumer (DN.Y.), Senate Small Business and Entrepreneurship Committee Chairman Marco Rubio (R-Fla.) And Member of the Senate Small Business and Entrepreneurship Committee ranking, Ben Cardin (D-Md.).
The bill’s provisions for streamlining the loan cancellation process for loans under $ 150,000 and providing agricultural credit service institutions with access to set-aside for small financial lenders would also help farmers. farmers and ranchers.
In addition, the AFBF is calling on lawmakers to provide certainty that all H-2A workers in the United States are considered employees under the PPP and that wages paid to those employees are eligible for loan forgiveness. The group demanded that PPP funds used to offset costs associated with housing and transporting farm workers also be eligible for a rebate.
“Many producers provide housing for farm workers that will need to be modified to comply with federal health and safety guidelines. In some cases, producers may need to secure additional housing entirely. Producers have also taken steps to mitigate the spread of COVID-19 by limiting vehicle occupancy as workers commute to workplaces every day, forcing producers to hire additional vehicles. These changes resulted in unforeseen accommodation and transportation costs, ”Duvall explained in the letter.
The Farm Bureau is also urging Congress to clarify that expenses incurred while operating a business under a PPP loan are deductible as normal and customary business expenses for income tax purposes.
“To do otherwise would have the effect of taxing the loan amount and the loan aid interest as income, the exact opposite of Congress’ intention,” Duvall wrote.
For a more detailed analysis of the PPP provisions of the Senate HEALS Law and the Omnibus Law on Emergency Solutions for Health and Economic Recovery adopted by the House, see this Recent market intelligence.
The House passed the HEROES law in May. Once the Senate approves the HEALS law, the two chambers will negotiate a single bill to be sent to the president for signature.