SAF in Action SAF ADVOCATES FOR FAIR USDA GROWER AID PAYMENT FORMULA
> As reported this spring, the Society of American Florists, leading a coalition of other industry trade associations, suc- cessfully advocated for floriculture grow- ers to receive direct aid from the U.S. Department of Agriculture. Although the USDA released payment formulas for other eligible crops for Coronavirus Food Assistance Program in May, USDA did not release details of the payment formula for floriculture growers. Instead, USDA sought more input on how aid payments should be calculated and posted a Notice of Funding Availability (NOFA) on CFAP direct payments. SAF worked with AmericanHort,
the California Farm Bureau and the Florida Nursery, Growers and Landscape Association (FNGLA) and Charlie Hall of Texas A&M on the comments, which were submitted earlier this week. This time, the emphasis with USDA was a funding formula that would work for all horticulture growers, not just cut flowers and potted flowering plants. Once USDA acknowledged a willingness to include cut flowers as an aid recipient, it made sense to offer a single solution to the USDA for horticulture, as SAF believes the approach taken should be the same. Current CFAP direct payments are based on price-loss, which is a good fit for row crop commodities but not for floriculture. Through the comments, SAF and 103 other industry trade organizations that signed on to the letter sought to make the case to USDA that horticulture’s situation is unique enough to require a unique payment approach. The comments, submitted to
USDA Deputy Administrator for Farm Programs William Beam, said in part:
The nursery and floriculture sector, which represents one-third of the value of all specialty crops, experienced serious economic harm resulting from COVID-19-related disruption of the market chain during the three-month period between January 15 and April 15, 2020. The timing could not pos- sibly have been worse, as 60 to 80 percent of the industry’s sales occur in a 10-week window falling from
March to May. During the height of the pandemic, sector losses resulting directly from associated market dis- ruption were conservatively estimated at $400 million or more. More recent estimates show that the total COVID- 19-related losses in the nursery and floriculture sector will reach between $732 million and $1.2 billion. At a time when sustaining employment is para- mount, these losses threaten some of the roughly 275,000 jobs in nursery and floriculture production.
The industry’s losses resulted substantially from state and local gov- ernment-mandated business closures and restrictions on consumers. The most extreme impacts were felt by producers of the most highly perishable “color crops,” including flowering plants, fresh cut flowers, and tropical foliage plants, which also have some of the narrowest market windows. Data for some of these crops are reported in the USDA Floriculture Crop Summary, which for 2018 reported total wholesale sales of $4.63 billion by growers producing at least $10,000 worth of these crops. The worst-affected growers were forced to dump hundreds of thousands and even millions of dollars’ worth of finished, market-ready crops per week during portions of the aforementioned period, especially during March and April.
The comments recommended
the USDA use one of two funding approaches. The first option would be a revenue loss approach, where producers who demonstrate a drop in sales over the covered period due to the COVID-19 market disruption, when compared to the same period in 2019, would receive a predetermined percentage of those lost sales, similar to the approach taken in the dairy sector. This would be the most streamlined approach. However, 2020 was projected to be among the strongest sales years for the entire sector, and this approach would not compensate growers for those anticipated sales. The second option is based on a cat-
egory of losses under the current CFAP rule. For nursery and floriculture crop
The magazine of the Society of American Florists (SAF) 11
producers with planned shipments which did not leave the farm between January 15 and April 15, 2020, and which have not been and will not be sold, payments will be based on the value of unshipped crops multiplied by a pre-specified payment rate expected to represent a percent- age of the crop’s value as established through weekly or monthly sales and inventory records. Under either option, the comments suggested growers could substantiate their claims based on (1) producer sales and inventory records for the applicable period in 2020 and the corresponding period in 2019, and/or (2) cancellation records of booked sales, inventory records, and “dump reports” of plants destroyed due to loss of markets during the specified time period. “SAF worked hard to make sure
floriculture was included in the USDA aid package given the severe impact of COVID-19 on our growers, but now we’re working to ensure the payment formulas the USDA uses fairly compen- sate growers for their losses,” said Joe Bischoff, SAF’s senior lobbyist. “We remain committed to advocating with the USDA on behalf of floriculture growers as the aid process proceeds to the application phase.” At press time, USDA had not yet
released final aid funding guidelines, which are expected in late July.
Jennifer McNally is director of marketing and communications for the Society of American Florists.
jmcnally@safnow.org
REIGNITE YOUR BUSINESS Throughout June, SAF delivered tar- geted webinars aimed at driving new business to retail florists’ operations and navigating the new business environment through its Reignite Your Business series, sponsored by Teleflora. Catch up on those webinars, including sessions on marketing effec- tively, online strategies and more at
safnow.org/webinars.
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