Odds and ends, 2022-2023:
Finally, six months after the end of sign-up, the Pandemic Assistance Relief Program (PARP) payments have been released. Last January, two new disaster relief programs were announced for 2020/2021, Emergency Relief Program phase 2 (ERP2) and PARP.
Most of us were expecting ERP 2, as it has come to be called, as it was announced in June 2022 after funding was made available by Congress in the 2021 Continuing Budget Resolution to keep the government open. It was passed in the waning hours of Sept. 30, 2021.
ERP 1, as the first phase was called, had a sign-up that started on June 2, 2022, after a six-month waiting period. According to USDA, new releases of ERP 1 were going to be easy-peasy. USDA said sorry you had to wait so long for any relief from 2020-2021 disasters, but here it comes. By the way, we are only going to pay those farmers that already got paid for losses under Federal Crop Insurance for those years. Wait. What? There is only pay for losses suffered by producers that had crop insurance claims paid out in those years. One may ask, but those guys have already received some help with their losses, what about everyone who did not receive an indemnity in those years? USDA said that seems to be the fastest way to get benefits out after six months of trying to figure out how to do distribute disaster funds that Congress had approved. We can make payment based on crop insurance indemnities or pay a producer a percentage of their crop insurance indemnity and get the payment out fast. So, producers with crop insurance loss in ’20 and ’21 received all the ERP phase 1 benefits and those producers who did not qualify either due to their level or crop insurance coverage or due to their level of loss got nothing.
Risk Management Agency (RMA), our sister agency, is in charge of Federal Crop Insurance, administered totally by private companies. The companies get paid by RMA to administer it and get total control of the claims process, such that if a loss is determined, the private companies who are at no risk will get totally paid back by RMA on claims amounts their loss adjuster determines are legitimate.
Under ERP phase 1, Congress in its infinite wisdom in the last minutes before midnight Sept. 30, 2021, passed disaster compensation funding for crop losses while trying to keep the government open the next day. That same Congress decided to let USDA decide how to spend those disaster funds based on 2020-2021 crop losses. USDA chose to let the claims paid by private companies administering the federal crop insurance program and getting reimbursed by RMA, send FSA the dollar amounts paid in both 2020 and 2021 for crop insurance indemnities, and that became the basis for ERP phase 1. Therefore, only allowing crop insurance customers that had a loss claim paid and had already in 2020-2021 been reimbursed for a portion of that loss by crop insurance became the only farmers that could qualify for ERP 1.
However, never fear, USDA said, ERP phase 2 (ERP 2) was going to closely following ERP phase 1 it was coming in fall of 2022, to cover (as it was put out in press releases) the shallow losses suffered by farmers in 2020-2021, that were not covered by crop insurance. So, producers that had not received anything for crop losses in 2020 and 2021 had to wait. Well, that never happened in the fall of 2022 or any time in calendar year 2022.
To be continued.
