KANSAS CITY, MO – The Paycheck Protection Program (PPP) was a $953 billion program established by Congress in 2020, to help businesses, self-employed workers, sole proprietors, certain nonprofit organizations, and tribal businesses continue paying their workers, in response to the nationwide economic shutdown due to coronavirus.
Farmers and ranchers could use loans from this program to help keep employees on payroll and offset some of their operating costs and the maximum loan amount was equal to 2.5 times the monthly average profit plus payroll and eligible overhead expenses, such as the employer’s share of insurance payments and unemployment taxes.
If used on eligible expenses within the first 24 weeks of disbursement, PPP loans were fully forgiven.
According to data from USDA’s 2019 Agricultural Resource Management Survey (ARMS), 72 percent of all commercial farm operations had either positive net income or positive payroll, which met the two most important eligibility requirements to apply for PPP loans and the Small Business Administration (SBA) reports that almost 121,000 farm operations applied for a share of $6 billion in 2020.
According to the Economic Research Service (ERS), 65 percent of the loans were to row crop operations ($3.9 billion) and the remaining 35 percent was disbursed to livestock operations ($2.1 billion).
(SOURCE: All Ag News)
