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Iowa farmers get $100 million in government relief
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Iowa farmers get $100 million in government relief

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DES MOINES — Gov. Kim Reynolds announced plans Tuesday to channel about $100 million of federal CARES Act relief funds for a range of agricultural programs to offset the impact of COVID-19 on farmers, producers and agricultural industries.

Money from Iowa’s $1.2 billion share of the $2 trillion federal stimulus package approved earlier this year will go to farm sectors hurt by the coronavirus pandemic that first hit Iowa in early March, the governor said.

Under the plan:

  • $60 million will go to an Iowa livestock producer relief fund
  • Up to $9 million for an Iowa disposal assistance program
  • $15.5 million for a state biofuel grant program
  • $7 million for a renewable fuel retail recovery program
  • $6 million to the Iowa beginning farmer debt relief fund
  • $2 million for the meat processing development and expansion program
  • $500,000 to help finance a farm produce and protein program.

“This has been a tough year for the agriculture community,” Iowa Secretary of Agriculture Mike Naig said. “The programs funded by the CARES Act will help our farmers, renewable fuels retailers and producers, and small meat processors respond to market disruptions and continue on the road to recovery.”

Iowa exported more than $16 billion in manufactured goods and agricultural products to 199 countries last year, so the “critical” assistance announced Tuesday will help support and maintain Iowa’s place in the world market, according to Debi Durham, executive director of the state Economic Development Authority and the Iowa Finance Authority.

“Iowa is at the foundation of our global food supply chain and the epicenter of the renewable fuels industry,” Reynolds said in a statement.

“COVID-19 and a devastating derecho dealt a major blow to everything from the demand for ethanol to the supply of meat on grocery store shelves. But just as important are the livelihoods of thousands of Iowa farm families, agricultural industries and the communities they support.

“Today’s investment,” Reynolds said, “reflects the critical role Iowa’s ag industry has in our state’s overall economic recovery.”

According to the governor’s office, by using the IEDA’s existing small-business relief program infrastructure, the $60 million livestock producer relief fund will provide grants of up to $10,000 to eligible producers of pork, beef, chicken, turkeys, dairy, fish or sheep to serve as working capital to stabilize livestock producers.

In addition, the state Department of Agriculture and Land Stewardship is in charge of an Iowa disposal assistance program initiated in May to help livestock producers recoup expenses incurred when they were forced to euthanize and dispose of livestock due to lack of market access caused by the COVID-19 disruption of the meat supply chain,

The two state agencies also will work in concert on the biofuel and renewable fuel programs with $15.5 million provided for biofuels producers who were excluded from receiving aid under other parts of the CARES Act.

The new program will provide relief to those Iowa ethanol and biodiesel producers based on gallons produced, with grants awarded through IEDA’s existing small-business relief program that will be capped at a maximum of $750,000 per producer.

The state ag agency already administers the renewable fuel retail recovery program and the added $7 million will go to help expand retail fueling infrastructure for higher blend renewable fuels — including E15 or higher and B11 blend or higher.

Iowa Renewable Fuels Association Executive Director Monte Shaw said fuel demand was “badly hurt” when pandemic hit this country and most Americans opted to stay home as much as possible as a safety precaution and, in some states, under government directive.

Shaw said Tuesday’s announced funding is a “much-needed” lifeline for Iowa’s renewable fuel producers and makes Iowa the first state in the nation to provide direct aid to the biofuels sector.

“At its peak, the COVID-19 pandemic led to the idling of roughly 50 percent of Iowa’s biofuels production capacity,” Shaw said in a statement. “Even today, fuel use has not returned to normal and biofuels producers are struggling to simply break even.”

According to the governor’s office, the $6 million in CARES Act money going toward debt relief will help eligible beginning farmers with a long-term debt service payment of up to $10,000 paid directly to their lender.

Another $2 million will aid small meat processors to expand processing capacity across the state to meet protein demand. A separate $500,000 will help specialty ag producers in Iowa as well as the schools that purchase them.

In addition to supporting local growers of fruits and vegetables to expand their capacity, it provides grants to schools that buy produce and other local crops and protein sources.

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