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COVID-19 FAQs for Farmers

* UPDATED 5/7/2020 *

This is a challenging time for our entire community.  As farmers and ranchers, you provide an essential service feeding the public with fresh, nutritious foods.  It’s very important that you are informed about the COVID-19 outbreak and its implications for your operation.  If you have a question not answered below, please contact Vince Trotter at tvtrotter@ucanr.edu or call
(415) 473-3281. 

FAQ Topics

Shelter in Place

Food Safety

Employee Health & Wellbeing

Marketing/Sales

Financial Assistance

At the end of this FAQ, you can also find a list of useful links to various public health agencies.  You may want to visit them for regular updates.

Shelter in Place

Will the Shelter in Place order for Marin County prevent me or my employees from doing our work?

As with Marin’s previous two Shelter at Home Orders, the new order (passed on 4/29) names food cultivation, including farming, livestock, and fishing as essential business activities during this period.  This includes the movement of employees outside of their residences so that these businesses can continue to offer their goods and services. 

HOWEVER, all essential businesses must develop a social distancing protocol and post it for employees and customers.  Follow these 4 steps to meet this requirement:

  1. Download the template for a Social Distancing Protocol here. 
  2. Fill out the template, identifying all applicable practices for your farm/ranch. If there are other systems/practices you are using, you can add them on a new page at the bottom of the document.
  3. Review the protocols in the document with your employees and give them copies of it.
  4. Keep the protocol posted at the entrance where employees or any members of the public access the farm/ranch.

For more information on Marin County’s Shelter in Place order, consult the FAQ (both English and Spanish) on the county’s Coronavirus Information Page.

Does the Marin order require us to wear masks?

As of April 22, Marin Health & Human Services requires that all individuals wear some kind of face-covering when they leave the house except when driving alone or with members of their own household.  This includes employees of essential businesses, whenever coworkers are present, even if they are not interacting with the public.  Children age 12 and under are exempted and children under the age of two should not wear a mask.  Full details of the order can be found here.  CDC guidance around making and wearing masks can be found here. 

Marin HHS asks that both the public and workers at essential businesses reserve N-95 and surgical-style masks for healthcare professionals and instead use simple cloth coverings, bandanas, homemade masks, etc.  Masks with one-way valves designed for "easy breathing" typically allow for exhalation of droplets and should not be used.

NOTE: This is an additional step on top of the best practices such as washing hands, maintaining 6-ft of distance between others, and avoiding touching your face.

Is cheesemaking considered an essential business activity?

If you have a retail space associated with the cheesemaking, this would fall under the allowance for ”…other establishments engaged in the retail sale of unprepared food…” found in item ii of the definition of “Essential Businesses”.  If you operate a cheese plant purely for sale/distribution to restaurants, retailers or even direct to consumers, then your continued operation would fall under item xx of the definition of “Essential Businesses” – “Businesses that have the primary function of shipping or delivering groceries, food, or other goods directly to residences or businesses.”

You will need to complete a Social Distancing Protocol by 4/3/20 (see previous question) and comply with best practices identified by Marin County Environmental Health Department .  If you operate a retail space for purchase of your cheese, you should implement the practices for food/beverage venues identified by the California Department of Public Health (CDPH)

For more information on Marin County’s Shelter in Place order, consult the FAQ (both English and Spanish) on the county’s Coronavirus Information Page.

What about the new statewide Order?

California Executive Order N-33-20 issued on March 19th provides a “floor” for local shelter-in-place orders.  Counties and municipalities may have more strict guidelines.

Statewide, everyone is required to stay at home except as needed to access “essential services” or to work in one of those industries.  This includes grocery stores and farmers markets as well as restaurants (pick-up or delivery only) pharmacies, banks, gas stations and laundromats.  Also exempted are the federally recognized “Essential Critical Infrastructure”.  This allows for the continuation of food and agriculture-related activities included farming/ranching, food processing, distribution and the many businesses that support food and ag such as fertilizer dealers, feed stores, irrigation and tractor supplies, etc.  If you work in one of these areas, you do not need written authorization to travel to work and engage in related activities.  Keep in mind, however, outside of this and the access to grocery stores, etc., you are expected to stay at home and follow all best practices around social distancing and sanitation.

Will slaughter plants still be operating?  My animals won’t wait.

The USDA has announced that meat, poultry and egg inspection services will continue as normal.  They have put into place measures to ensure that employee absenteeism will not adversely affect industry operations.  This statement from Dr. Mindy Brashears (USDA Deputy Undersecretary for Food Safety) and Greg Ibach (USDA Under Secretary for Marketing and Regulatory Programs) asserts that they are focused on maintaining timely delivery of services.

Local cut-and-wrap providers are considered essential businesses during this period of Shelter in Place.  As such, they are allowed to continue with normal operations.  Contact your processor directly to know how or if their services have been impacted.  Some businesses may have trouble maintaining adequate staffing due to closures of schools and daycares as well as the general directives to send any sick employees home.

But what about all the big plant closures we’ve been hearing about?

 Several large processors outside of California have closed due to COVID-19 outbreaks among their employees.  Some plants are saying they will be open again soon, others have not announced when they will resume operations.  This has had the impact of depressing prices for live animals at auction.  Meanwhile, smaller regional plants that provide private label and custom slaughter are operating at capacity.

If you raise beef, you may want to consider exempt processing.  You can sell live animals to a person or many separate people and have the animal harvested at the ranch by a local custom operation.  The customers who purchased “shares” of the live animal can then pick up the cuts at the meat shop.  Read about this process on our website here.

If you have access to inspected slaughter but cannot get the carcasses cut-and-wrapped, you could potentially do the cutting yourself in a commercial kitchen and sell the cuts direct to consumers under the USDA retail exemption.  You would in essence be operating like any other butcher shop or meat counter with only a county food facility permit.

Read this brochure here to understand the regulations for a “Retail/Restaurant/Central Kitchen” exemption and contact Vince Trotter at tvtrotter@ucanr.edu for more details.

What will happen to my buyers during the Shelter in Place order?

Certified farmers markets, farm and produce stands, as well as supermarkets, grocery stores and restaurants providing food for delivery or carry-out are all considered essential businesses and may continue to operate.  To find out what changes in practice may be required at your local farmers market, consult with your Market Manager and follow any food facility guidance from county Environmental Health Services.  California Department of Public Health (CDPH) has also posted policies and recommendations for food facilities.

The Agricultural Institute of Marin has published two handy videos demonstrating best practices for farmers markets:

Food Safety

Do I need to change my food safety practices in the wake of COVID-19 emergency?

The USDA has stated that “Currently there is no evidence of food or food packaging being associated with transmission of COVID-19. Like other viruses, it is possible that the virus that causes COVID-19 can survive on surfaces or objects.”

Additionally, the CDC has said on their Coronavirus FAQ:

“Coronaviruses are generally thought to be spread from person-to-person through respiratory droplets. Currently there is no evidence to support transmission of COVID-19 associated with food.  It may be possible that a person can get COVID-19 by touching a surface or object that has the virus on it and then touching their own mouth, nose, or possibly their eyes, but this is not thought to be the main way the virus spreads.”

In general, because of poor survivability of these coronaviruses on surfaces, there is likely very low risk of spread from food products or packaging that are shipped over a period of days or weeks at ambient, refrigerated, or frozen temperatures.”

In other words, there is every reason to think that the current recommended best practices for harvesting, washing and packing produce are sufficient.  However, it is vitally important that any workers showing signs of illness be removed from food processing as studies show that COVID-19 can survive on hard surfaces or objects for up to 72 hours.  This could include metal tables used in your post-harvest area and plastic bags or wax boxes that hold produce.  Cardboard such as those used for shipping fruit or other products can support COVID-19 for 24 hours.  The CDC has published an extensive explanation of how to clean surfaces and maintain good sanitation in the context of COVID-19.  You can find it here.

One easy disinfectant being recommended for general household sanitizing is 4 teaspoons of bleach in 1 quart of water, placed in a spray bottle for easy application on a variety of surfaces.  

Aren’t I killing COVID-19 in my wash water?

The CDC has published a list of disinfectants that kill COVID-19.  If the sanitizer you currently use is not mentioned on their list, Kali Feiereisel of CAFF’s Food Safety Program says in her excellent blog post, “It would be better for food safety if you kept using it [according to the label] than discontinue its use."

If you’re not currently using a sanitizer in your postharvest wash water, you can find one on the Produce Safety Alliance’s Resource Page. Certified Organic operations should review USDA’s list of Organic-approved sanitizers and detergents here.

For many, the use of bleach (sodium hypochlorite) is a go-to strategy in these times.  Read your labels, paying close attention to the concentration of NaOCl in your bleach.  Here are two essential resources for determining the right concentration for your use and calculating the ratios:

Am I (or my employees) potentially spreading COVID-19 just by handling product, loading trucks, etc.?

Good hygiene by you and your workers is essential.  As the CDC points out on their Coronavirus FAQ, “Before preparing or eating food it is important to always wash your hands with soap and water for 20 seconds for general food safety. Throughout the day wash your hands after blowing your nose, coughing or sneezing, or going to the bathroom.”  Disposable gloves and hand sanitizers are no substitute for frequent, thorough hand-washing.

You should also be washing down work surfaces frequently.  See the CDC’s guidance around cleaning and disinfecting here.

These activities should already be part of your standard operating procedures, and it is vital to remain vigilant with these practices.  You can find more specific guidance from Marin County Environmental Health here.

Employee Health & Wellbeing

Are my employees in any danger if they come to work at the farm/ranch?

Any employees who fit the CDC’s guidelines for “higher risk” should remain at home.  This includes people age 65 or older and those with an underlying medical condition such as lung disease, asthma, heart disease, diabetes, a weakened immune system, or any of the other illnesses mentioned here.

Similarly, anyone exhibiting signs of illness, especially symptoms associated with the common cold should remain at home and consult with their doctor.

For other employees, the CDC has published a lengthy list of practices to protect yourself and others.  Chief among them is to avoid close contact with others, maintaining a 6-foot distance from coworkers, cover coughs and sneezes, and wash hands frequently.  Marin County has created this poster you can use to explain the basics to your employees with a version in Spanish here.  Their FAQ on COVID-19 is also available in Spanish here.

Consider that your employees may be dealing with a variety of challenges.  Public transit has been dramatically affected, access to basic food and supplies may be limited due to hoarding behavior by some in the community.  Additionally, closure of schools and aftercare programs is making it hard for many to maintain their regular work schedule.  Use flexibility and judgement wherever possible.  The safety and well-being of your workers is closely connected to the safety of our community as a whole.

If you are struggling to communicate the details of COVID-19 to workers with limited English, check out Switchboard’s list of multilingual resources related to the coronavirus here

We typically work in teams, and there isn’t enough room to spread out in the pack house/processing plant/milk room.

This is a particular challenge for many food processors.  Some operations have taken to splitting shifts so fewer people are working at the same time, spreading the work over a longer stretch.  If some indoor activity can be moved outdoors where there is more room to spread out, consider that. 

Be conscious of equipment that is shared by multiple people and either purchase more to reduce sharing or institute practices to wash between uses.  Telephones, hand trucks, harvest knives, hand tools.  Also note fixtures that are handled repeatedly by your crew.  Assign a person to rotate through with sanitizing spray or equip each person to clean a surface prior to their own use.  Handles on lift gates, steering wheels on trucks, valves on tanks or knobs on doors that can’t be propped open for reasons of food safety or climate control.  All of these should get regular cleaning.  The EPA has an exhaustive list of approved disinfectants here.  A simple solution of bleach diluted in water and kept in a spray bottle should be easy to make and apply.  Always read labels carefully.

Remember, you are not only trying to prevent spread of the virus among your employees – you are preventing anyone from taking it home to their families.

Keep in mind that the use of N-95 masks should be reserved for infected persons and healthcare professionals.  The California Department of Public Health has released new guidance around cloth masks and makeshift barriers as potential aids in preventing the spread of coronavirus.  However, maintaining distance between people and establishing good sanitation practices are still the best method of keeping people safe.

Other important steps include:

  • Discourage employees from sharing cell phones, lunches or other personal items
  • Prepare for people to be absent. Cross train your crew and take a moment to make a plan – what will you do if one person has to stay home?  What if two?  How will you change daily flow and what parts of the operation can you slow or put aside until you are back up to speed?
  • Grant sick leave when workers show signs of illness or if they need to care for sick family members. If you don’t already have clear information on company policy, sit down with workers now to explain.  See "What happens if an employee falls ill?" below.

What is this Social Distancing Protocol I’m hearing about?

As of 4/3/20, all essential businesses must develop a Social Distancing Protocol.  Follow these 3 steps to meet this requirement:

  1. Download the template for a Social Distancing Protocol here. (Scroll to the bottom and click on “Appendix A – downloadable for businesses”)
  2. Fill out the template, identifying all applicable practices for your farm/ranch. If there are other systems/practices you are using, you can add them on a new page at the bottom of the document.
  3. Review the protocols in the document with your employees and give them copies of it.
  4. Keep the protocol posted at the entrance where employees or any members of the public access the farm/ranch.

What happens if an employee falls ill?

The CDC is continually updating its Guidelines for Businesses & Employers.  Most importantly, the guidelines state:

“Employers should not require a positive COVID-19 test result or a healthcare provider’s note for employees who are sick to validate their illness, qualify for sick leave, or to return to work. Healthcare provider offices and medical facilities may be extremely busy and not able to provide such documentation in a timely manner.”

The Family First Coronavirus Response Act mandates new, nationwide access to paid leave for family and medical emergencies during the pandemic.  This includes workers who must stay home due to school/daycare closures.  For employers with fewer than 500 employees, this new law lays out a combination of leave types and timings that vary according to the size of your workforce and employees’ reasons for staying home.  Most importantly, it will give you tax credits to cover the cost of the sick leave, and you can reduce your quarterly estimated tax payments accordingly.    And while small businesses of less than 50 employees can request a hardship exemption from the mandate, it’s important to consider the alternative: Employees who fear the loss of income may feel they have no choice but to go to work sick and hide it from their employers and supervisors.  This is a scenario that may ultimately shut down your entire workforce.

Read up on the provision and how to claim the tax credit at the IRS’ site here.

Four good places to read up on the new sick leave provisions are:

What if I have to lay off workers due to slowdowns in my business?

Under the recently passed coronavirus relief package (aka “CARES Act”), a new Pandemic Unemployment Assistance Program extends traditional unemployment benefits for an additional 13 weeks with an extra $600/week added to the amount already paid by the state. This is separate from the direct cash payments of approximately $1200/person ($500/child) that are being sent to individuals and families regardless of employment status. (NOTE: these direct payments are only available to people who have paid federal taxes at least once since 2018.)  Unemployment benefits will be paid retroactively as far back as February 1st, 2020 so long as workers can attest that their job loss was related to COVID-19.

Direct employees to the California Employment Development Department (EDD) for details on filing an unemployment claim.  Due to the nearly 3 million claims filed in the last month, the EDD is advising people to file online at https://www.edd.ca.gov/Unemployment/UI_Online.htm.  While claims typically take 21 days to process, the EDD says they intend to cut the time it takes to receive payments down to 48 hours from application.

NOTE: Unemployment benefits are also available to people who have simply had their hours reduced due to COVID-19.  If you have cut hours due to slowdowns in sales/production, refer your team to the EDD (above).

You can also direct employees to the new job-matching site with over 70,000 jobs available now:  https://onwardca.org/

Make sure that all of your employees understand that there is a statewide moratorium on evictions in effect, so even if they lose their jobs, their housing should remain secure.  If you provide housing for your employees and are needing to reduce your staff, know that this moratorium also applies to you.  Folks can read a summary of the policy on the governor's website here.

Some of my employees may not have access to public benefits due to immigration status

Governor Newsom announced on 4/15 a program to distribute cash aid to undocumented immigrants through partnerships with local non-profit organizations.  As of 5/1, this program has been tied up in litigation as concerns were raised about the constitutionality of such a program.  Stay tuned.

The Governor’s office has also issued a COVID-19 Guide for Immigrant Californians.  See it here in 6 languages.  It will undoubtedly have updates related to the new cash assistance program.  It also explains the Public Charge rule and what kinds of public benefits immigrants can claim without jeapordizing their immigration status or green card process.  Share this document with your employees.

Isn’t there a federal program to help me cover my payroll?

The CARES Act created something called the Paycheck Protection Program to cover 8 weeks of payroll, rent, utilities and mortgage interest.  You should talk to your lender/bank about preparing an application.  After the initial funding ran out, Congress has reappropriated money, but it is not expected to last long.  Read "Is there any kind of emergency funding available?" below.

Marketing/Sales

My restaurant contracts have dried up.  What do I do now?

This is a quandary many farmers are facing.  Community Alliance With Family Farmers (CAFF) has put up a great page full of resources for finding new markets and adapting to new methods of sales/distribution in the era of COVID-19.

A number of other organizations are aggregating product from farms around the region and making them available for customer pickup.

  • FEED Sonoma's FEED.Bin is assembling hundreds of boxes of produce for customers to pick up or have delivered.  If you already sell to FEED or if you conform to organic practices and need a place to sell product contact Tim Page at tim@feedsonoma.com for details.
  • Agricultural Institute of Marin (AIM) is initiating a curbside pickup program for pre-ordered regional products as well as pre-assembled boxes of products that can be purchased at several of AIM's farmers markets.  To add your products to the program, contact Andy Naja-Riese at andy@agriculturalinstitute.org
  • Farmers market organizer, Agricultural Community Events (ACE) has created a complete e-commerce site for their market vendors around the Bay Area. Customers can pre-order any of the farms/ranches items for pickup at the market.  The site handles all of the financial transactions as well.  Contact info@ilovefarmersmarkets.org to join a market and get into the platform.

Others are helping to promote your products to a wider audience:

  • CAFF has started an online list of farms with product to sell and buyers looking for items.  You can enter your products to the list and CAFF’s staff will help identify good matches.  You can access the list here.
  • If you are a member of Sonoma County Farm Trails, they will promote your products directly to thousands of consumers and publicize whatever delivery/pickup options you can arrange.   For details, contact the Farm Trails office at farmtrails@farmtrails.org. 
  • The Marin Agricultural Land Trust (MALT) is also promoting Marin producers in their newletters and blog.  Contact Tristan Conway for details at tconway@malt.org.

Should I start selling my products online?

Maybe.  The pathway to selling products online can range from low to high-tech.

Low-tech: Promote your products over platforms like Nextdoor and CropMobster.  You can take orders over email, arrange payment via online services like Paypal and then drop off at individuals’ homes or set up an impromptu pick-up at your farm.  Simply ensure that you maintain a 6-foot distance from people and encourage your customers to do the same if their pickups overlap with others.

Medium-tech:  If you’re already using Quickbooks, you can add invoicing and payment processing that integrates with your system.  Email customers an invoice with a “pay now” button that allows them to enter credit cards or bank transfers.

High-tech:  Set up an e-commerce website that allows customers to choose products from a catalog, create a “cart” and checkout with online payment.  National Young Farmers Coalition reviewed several such e-commerce platforms, comparing features of 19 different software options.  See the breakdown here.

CAFF has some great resources related to sales and marketing for farms here.

Check out these webinars on selling farm products online:

Some best practices to keep in mind when selling online:

  • Making the website is easy compared with the work of promoting that website. Be prepared to work social media channels.  Promote your site via whatever mailing list you already have and ask those people to share with their friends and neighbors. 
  • Although online purchase of groceries is on the rise, it’s still relatively uncommon. Millenials are most inclined, so think about them when you’re marketing your site.  Industry analysts say that millennials are more drawn to the values of a product – what does your farm stand for and how are your own values present in your products?  Health claims and convenience are also key drivers.
  • Online purchasing follows a "rule of 3". It typically takes 3 successful online purchases before a customer becomes truly loyal.  That means that your first few transactions with someone are key.  Focus on customer service and getting it right.  Even when transactions are automated over an e-commerce site, find ways to personalize it with a thank you note or something similar.  If you make a mistake during your early days of online sales, do everything you can to make it right.  It will pay off in return customers and their endorsement of your product.

I’m not really an online sales kind of person

Not to worry.  Farm stands are deemed an essential business under the county’s Shelter in Place order, so if you have one already set up, you can continue to operate.  If you have a safe place on your property for people to park and visit a shaded table or other protected space, you might consider this.  Be conscious of impacts to traffic and pedestrian safety and check with neighbors to make sure they will not be negatively impacted.

UCCE Fresno has created a list of best practices for running your farmstand and some signage you can put up to help your customers do the right thing. 

For other ways to promote your products direct to consumers during this time, check out this quick video by Tim Young’s Small Farm Nation.  He outlines 3 ways you can connect with customers during the pandemic.  Additionally, online sales platform Barn 2 Door posted a blog with 3 ways to sell product under COVID-19, and Local Line (another sales platform) gives advice on setting up for direct-to-consumer sales here.

Any other suggestions for how to sell my products?

Think partnerships.  Even if you aren’t, many farms are launching online sales, going direct to consumers.  If you sell meat, team up with a produce farm that has an e-commerce site.  Maybe they would add your meat to their CSA.  If you make cheese, maybe an egg producer would offer your cheese to their egg buyers.   Customers are drawn to all-in-one destinations and would rather make one purchase for all they need than try to visit many different sites. 

What about other essential businesses that you know like breweries, wineries or restaurants?  Would they post a sign or host a pick-up/drop-off site for your products?  Would they promote your products alongside their own? 

Financial Assistance

I don't have employees.  Is there any help for the self-employed?

Yes.  The new sick leave law provides funding to credit self-employed individuals in repayment for time away from work due to COVID-19 related sickness, the sickness of family members, or the need to care for children during school/daycare closures.  This will take the form of a tax credit you can file with your business taxes at the end of the year, and in the meantime you can reduce your estimated quarterly tax payments accordingly. 

This benefit maxes out at 10 days, with the value of each day calculated by dividing your 2019 net earnings by 260.  Full details are on the IRS website here.

As with the new access to sick leave, self-employed individuals are also able to claim unemployment for the first time ever.  Details are still being worked out, but California Employment Development Department says they will begin accepting online applications for self-employed and business owners on Tuesday, April 28th  .  More details here.

How do I keep up with all of my bills until the business is back on its feet?

California state Executive Order N-28-20 suspends evictions of residential or commercial leases where a failure to pay arises out of losses due to COVID-19.  It does not release anyone from the obligation to pay rent or prohibit a landlord from recovering rent due, but where a person or business has lost income as a result of infection or decreased demand for products, eviction is not an option.  This may provide some relief for farms struggling to pay for leased land or rented facilities.  It also provides protection for agricultural workers who find themselves unemployed or underemployed and unable to pay their rent.

Most major banks and even state-chartered smaller banks and credit unions in California have agreed to a 90-day moratorium on collecting mortgage payments from residential borrowers affected by the crisis and a 60-day moratorium on new foreclosures.  Home owners whose mortgage is insured by the Federal Housing Administration will be protected from any foreclosure action until the end of May, and mortgage payments to lenders backed by Fanny Mae or Freddie Mac can also be suspended for 12 months due to coronavirus-related hardship. Check with your own lender for details.  If you have borrowed money through one of the USDA’s Direct Loan programs, you can get relief or even a moratorium on payments.  See their announcement here.

PG&E has also initiated flexible payment plans and suspended service-disconnects for residential and small business customers who cannot pay their bills due to impact by COVID-19.  Details here.

Deadlines for state and federal tax filings have been delayed until July 15th.

If you collect sales tax on any of your products/services, you can hold on to the sales tax you collect for up to 12 months before having to turn them back to the state.  Details are here on the state tax board’s site – you will eventually need to create a plan that spells out when and how those collected tax funds will eventually be repaid.  Call the state tax center at 1-800-400-7115 to set up a plan.

Sales or use taxes apply to:

  • Alcoholic beverages
  • Dietary supplements
  • Nursery stock
  • Cosmetics
  • Pet food

Is there any kind of emergency funding available to help farms and ranches?

Local:

The Sonoma County Economic Development Board has assembled a page for small businesses that lists not only funding sources but also resources for your employees to get relief – including Disability Insurance for those who are quarantined and Paid Family Leave for those that may be caring for infected family members. 

California State:

The California State Treasurer has put together a growing document here, listing potential sources of relief funding from federal, state and local entities.  The Sonoma County Economic Development Board has assembled a page for small businesses that lists not only funding sources but also resources for your employees to get relief – including Disability Insurance for those who are quarantined and Paid Family Leave for those that may be caring for infected family members.

The Governor has also announced that small business that collect sales tax can hold onto those taxes as a kind of interest free loan and pay them back slowly over the next 12 months.  Details here.

Federal:

NOTE: THE PAYMENT PROTECTION PROGRAM (PPP) HAS BEEN RENEWED AND THE EIDL LOAN PROGRAM HAS BEEN EXPANDED TO ALLOW ALL FARMS TO APPLY.  FUNDING IS FIRST-COME-FIRST-SERVED.  APPLY NOW.

The federal government's CARES Act, now in its second iteration, provides small businesses (under 500 employees) with two main forms of assistance:

  • Paycheck Protection Program (PPP). Also called “7(a) SBA loans”, these loans will be administered by private lenders to pay for a specific set of expenses, most of which would be entirely forgivable (read: you do not have to repay the funds).
    • All funds used for the following expenses do not have to be repaid as long as 75% of total funds are spent on payroll
      • 8 weeks of payroll (for employees on payroll as of 2/15/19)
      • 8 weeks of mortgage interest
      • 8 weeks of rent
      • 8 weeks of utilities
    • Up to $10million per applicant, based on 2.5 times your monthly payroll.
    • Interest rate of 1% (presumably on funds not eligible for forgiveness) over 2 years with deferments on payments for 6 months
    • Self-employed and business owners can pay themselves with PPP funds by calculating their own monthly draw based on 2019 net earnings
    • If you have already laid off employees, you can still have PPP funds forgiven if you rehire them before June 30, 2020 and use PPP dollars to pay them.
  • Economic Injury Disaster Loans (EIDL). These are the low-interest loans traditionally provided by the Small Business Administration (SBA) in times of crisis to cover operating expenses and other expenses related to loss of business during the COVID crisis:
    • 3.75% interest with no payments for 12 months.
    • Loan amounts based on estimated “injury” to the business, up to $2million per applicant
    • Applicants can also request a loan advance of up to $10,000 which would be available much sooner and would not have to be repaid .  Loan advances are granted within days of an accepted application and are paid at $1000 per employee.

The Marin Small Business Development Center explains the differences between these programs on their website here or you can get more detail at the Small Business Administration (SBA) COVID-19 page  Consider viewing one of their webinars on the topic - see the calendar here..

At this time, we are recommending that farms take 3 steps:

  1. Apply with your local Small Business Development Center (SBDC) for assistance with this process. Go here to sign up: https://nc.ecenterdirect.com/signup or call 1-833-275-7232.
  2. Talk to your bank or current lender to see if they will be participating in the PPP - this is your best bet for securing PPP funding. If your bank is not participating, use this search for participating lenders tool.
  3. Start gathering documents for both the PPP and EIDL loans. These funds are limited and it is unclear how long it will take to receive funds.  Better to start now – you can always decline funds if you determine you don’t need them.  Application info here:

 

Other options for funding assistance:

 

 

Good Resources to follow for COVID-19 related updates: