April 22, 2020
Editor’s Note: The RFP has now been published and can be accessed below. We will continue to update this post as more information and resources become available. Last updated 4/27 at 5:02pm
Late on a Friday night (4/17), Secretary of Agriculture Sonny Perdue announced the highly anticipated plan for how the U.S. Department of Agriculture (USDA) intends to distribute the $23.5 billion Congress provided to aid farmers impacted by the ongoing pandemic.
The centerpiece of this USDA plan is the Coronavirus Food Assistance Program (CFAP). CFAP will consist of two components: $16 billion in direct payments for commodity growers, specialty crop farmers, and livestock and dairy producers, and $3 billion in direct purchases of meat, dairy and specialty crops.
USDA’s Farm Service Agency (FSA) will administer the $16 billion direct payment program, while the Agricultural Marketing Service (AMS) will administer the latter effort through a new “Food Box program.” The $19 billion program uses $9.5 billion provided under the CARES Act, $6.5 billion in existing Commodity Credit Corporation (CCC) borrowing authority, and another $3 billion from the Families First Coronavirus Response Act. In addition, USDA will have an additional $14 billion in CCC funding available later this year.
As initially reported by USDA last week, CFAP will consist of two components: $16 billion in direct payments for crop and livestock farmers and ranchers, and $3 billion in direct purchases of meat, dairy and specialty crops. USDA’s Farm Service Agency (FSA) will administer the $16 billion direct payment program, while the Agricultural Marketing Service (AMS) will administer the latter effort through a new “Food Box program”. More on that program below.
While pleased USDA is moving forward to provide urgently needed relief to our nation’s farmers, NSAC is extremely disappointed that USDA included no mention of local food or direct market farmers in their initial emergency payment plans. This is a direct rebuke to Congress, which explicitly included “Producers that supply local food systems (including farmers markets, restaurants, and schools)” in relief efforts. Stay tuned to NSAC’s blog as more information becomes available on the direct payment program.
As part of the other component of CFAP, AMS is seeking to partner with local and regional distributors — whose workforce has been significantly impacted by the closure of restaurants, hotels, schools and other food service entities — to procure and provide boxes of fresh produce, dairy, and meat products to food banks and other non-profits serving Americans in need.
Providing boxes with fresh food is unique for USDA, which has a long track record of purchasing and procuring shelf stable food from U.S. producers to provide to food banks, other emergency feeding organizations (EFOs) and other nonprofits engaged in similar work. Focusing on this fresh food box approach, which has some parallels to what Community Supported Agriculture (CSA) programs have been doing for years, is a way to try and get around the fact that the larger emergency food system is struggling with cold storage bottlenecks, volunteer shortages, and dwindling supplies of donated food. All of these challenges are occurring at the same time farmers across the country have been destroying crops or leaving them in the field as a result of social distancing strategies that have radically impacted their marketing channels.
The program is being run on a regional basis, using the 5 regions below:
As a brand new program, a lot of questions remain about how it will work; however initial details indicate that the new CFAP food box program could be a genuine opportunity for food hubs, community kitchens, and local food producers.
The program does not contain any small business set-aside, however applicants will be required to discuss how their proposed project supports the mission of facilitating agricultural markets and how they “intend to engage small farmers (e.g those farms servicing local and region interests and farmers markets).” More details on applicant requirements can be found by reviewing the Request for Proposals and associated documents here.
As expected, food hubs and local farmers will not be without challenges and barriers to participation; but NSAC nonetheless encourages food hubs, local food organizations, and local food producers to take a serious look at how they might form partnerships with food banks, other EFOs and nonprofits doing similar work to develop innovative projects and partnerships to provide healthy fresh local and regional food to those most in need during this unprecedented crisis.
AMS estimates it will purchase approximately $100 million per month in fresh fruits and vegetables, $100 million per month in a variety of dairy products, and $100 million per month in pre-cooked meat products through CFAP. Food boxes assembled and provided to food banks and other EFOs must consist of 100 percent domestic grown and processed food only. Food boxes can only include fresh produce, processed dairy such as cheese, pre-cooked chicken, pre-cooked pork, and fluid milk. Fresh cut produce will be allowed but not canned or frozen produce. Legumes are not allowed.
AMS is planning to support the assembly of 5 types or options of boxes: 1) fresh fruit and vegetable box, 2) dairy products box, 3) pre-cooked meat (chicken and pork only) box, 4) a combo box, and 5) fluid milk box. Proposals can include plans to assemble and deliver all 5 types of boxes or just 1, and everything in between. However, AMS is most interested in entities that can provide boxes with multiple products. There is no box size or minimum content requirements for the boxes. Boxes can be created for individuals or families.
USDA will award contracts for and provide resources for the purchase of the agricultural products, packing materials, the assembly of commodity boxes, and delivery to non-profit organizations that can receive, store, and distribute food items to those in need.
The RFP published by AMS does not including specific price points dictating how much an applicant is expected to be spending per box on any of the 5 types of food boxes the AMS is supporting the assembly and delivery of. Pricing and proposals will be ranked separately for each box type and will be compared to one another and historical prices to determine fair and reasonableness of pricing.
AMS has laid out a very aggressive timeline for implementing the program:
This program is being administered through the contracting office at AMS. Entities or “offerors” as the RFP describes them, that can qualify for contracts are not limited to food hubs and distributors, but any entities that can procure food, assemble boxes and distribute the boxes to nonprofits engaged in efforts to feed the needy are eligible, that includes farmer cooperatives, farmers market operators, and restaurants. However, in order to secure a contract, a food hub distributor or other entity will need to be authorized to become a federal procurement contractor. More information about becoming a federal procurement contractor can be found here.
Awards will be made without negotiations with the applicant therefore, the offeror’s initial offer should contain their best pricing. Awards will be made based on best value using a trade-off process considering the evaluation factors listed in the RFP. Best value may be determined using tradeoffs among the evaluation factors, so the award may be made to offerors other than the lowest-priced or highest technically rated proposal.
The biggest barriers for food hubs, similar organizations, and distributors is likely going to be the need to register and obtain a Data Universal Numbering System (DUNS) number, which is a nine-digit number required to compete for federal grants or contracts. In addition, the organization must also register in the System for Award Management (SAM) and have a SAM number. Registration for both a DUNS and SAM numbers are both free (note do not pay someone to register you in SAM the technical assistance centers below can help you for free). Also, note one of the emergency provisions in the RFP allows you to share your SAM registration at the time of receiving an award rather than at the time of submitting your bid/proposal to AMS.
For those who are having trouble navigating the process to become a federal contractor, there are free technical assistance centers across the country. More information can be found here.
In addition to those resources, NSAC member, the Wallace Center is hosting a webinar on Monday, April 27th at 4pm EST titled “RFP Tips & Best Practices for Federal Bids & Contracts”. You can register for the webinar by clicking here. The Wallace Center has also setup a system to foster opportunities for collaboration between regional organizations looking at applying to the program. If you are considering applying and would like to explore opportunities for coordination with other regional applicants, then please share your information in this spreadsheet.
More details on what is required to be a federal contractor for this solicitation can be found in the RFP and associated documents on AMS’s program website. NSAC highly recommends beginning the process of applying for a DUNS and SAM number now.
AMS has created two “questions and answers” documents 1) on the RFP process that can be found here and 2) on the overall food box program which can be found here. Further questions regarding the RFP may be submitted via email, to ERacquisition@usda.gov with “Questions – USDA RFP” in the subject line.
Very few details are provided in the RFP about what farmers will have to do in order to sell products to those entities that have received contracts from AMS through the program. Farmers providing products for the food boxes will not be considered USDA vendors and therefore will not have to become USDA approved vendors. Requirements of farmers will be more or less determined between the contracting entities that will be purchasing the food, assembling the boxes, and distributing the boxes.
There are some exceptions to that. Unfortunately, suppliers of fresh produce will have to meet one of the following:
This will likely be a significant barrier that prevents many small and medium-sized diversified farms from being able to participate in the program.
Milk and dairy products are required to have been manufactured from milk and dairy ingredients that were produced in the United States and in plants that were inspected and approved by the Dairy Grading Branch, Dairy Programs of AMS or manufactured in plants that are registered and regulated under the jurisdiction of the Federal FDA’s Food Safety Modernization Act (FSMA). For Meat/Poultry Products: All products must be produced under Federal inspection.