July 29, 2022
Organic agriculture continues to be one of the fastest growing sectors of American agriculture. In 2020, the organic food market experienced incredible growth, with sales over $56 billion, a 12% increase from 2019. During the COVID-19 pandemic, certified organic and transitional operations faced numerous challenges including loss of markets, increased costs, labor shortages, and expenses related to obtaining or renewing their organic certification. Transitional operations also faced the financial challenge of implementing practices required to obtain organic certification without the premium prices associated with certified organic commodities.
Producers who are certified organic, along with producers who are transitioning to organic production, can now apply for USDA’s Organic and Transitional Education and Certification Program (OTECP) and Organic Certification Cost Share Program (OCCSP). These programs help producers and handlers cover the cost of organic certification, along with other related expenses.
Applications for OTECP and OCCSP are both due October 31, 2022 through local Farm Service Agency (FSA) offices. One-on-one support is available by calling 877-508-8364.
How OTECP and OCCSP Work
OTECP was created in 2021 as part of the USDA’s Pandemic Assistance for Producers initiative and received $20 million in federal funding. This program provides reimbursement to agricultural producers and handlers who are certified organic as well as crop and livestock producers who are transitioning to organic. The current round of reimbursements is for eligible expenses that were incurred during the 2022 fiscal year. Fiscal year 2022 runs from October 1, 2021, through September 30, 2022.
Payments will be issued after the end of the application period for each fiscal year. OTECP payments will be prorated if calculated payments exceed the amount of available funding.
Meanwhile, OCCSP provides cost share assistance to producers who are obtaining or renewing their certification under the National Organic Program (NOP) and covers 50% or up to $500 per category of certification costs.
This cost share for certification is available for each of the following categories: crops, wild crops, livestock, processing/handling and state organic program fees. OCCSP funds are limited and applications are paid on a first-come, first-served basis. Applications received after all funds are obligated will not be paid.
Certified organic producers can receive cost share assistance through both OTECP and OCCSP, while transitioning producers can receive assistance through OTECP.
Bolstering Organic Agriculture
The 2019 Organic Survey reported robust growth in organic production over the last several years. Organic agriculture saw a 31% increase in overall sales since the 2016 Organic Survey and certified organic farmers transitioned 255,060 acres in 2019. This marks a 113% increase in transitional acres since 2014. Similarly, over 60,611 acres are being transitioned to organic by non-certified farms, compared to 50,688 in 2014. In 2020, the organic food market experienced incredible growth, with sales over $56 billion, a 12% increase from 2019.
The recently released National Organic Research Agenda revealed an urgent need for technical assistance to help transitioning farmers address a broad range of production, marketing, and other challenges. The relatively small number of transitioning farmers in the survey (71 as compared to the more than 1,000 already certified organic farmers) illustrated the steep hurdles farmers face when considering the transition.
While programs like OCCSP and OTECP help producers offset some of the costs of certification, the maximum reimbursement payment of up to $500 per category through OCCSP is hardly enough to cover the total costs of certification which can be thousands of dollars annually for many farmers.
The 2018 Farm Bill provided new mandatory funding for OCCSP, but unfortunately, due to accounting errors, USDA provided Congress inaccurate reports of carryover balances. This resulted in a funding shortfall for the program, and in August 2020 USDA reduced the maximum 75% reimbursement rate or $750 for the program to a maximum reimbursement rate of 50% or $500. This meant that organic farmers, already dealing with the strain of the pandemic and counting on the reimbursement for their certification costs, were left with a reduced payment.
The outcry from organic stakeholders, including the National Sustainable Agriculture Coalition (NSAC), prompted USDA to make new funding available for the program, and in June 2021, the agency announced it would provide up to $20 million in additional organic certification cost-share assistance as part of the USDA Pandemic Assistance for Producers initiative, which led to the creation of OTECP.
Stakeholders have long advocated for raising the maximum payment rate but with the agency seemingly unable to adequately keep track of its accounting, the program (and by extension, the agency) does not inspire confidence among organic producers. This is in addition to burdensome paperwork and a lack of education among FSA field staff on organic agriculture. To alleviate the problems plaguing the program and to better serve organic producers, it is clear broader reform is needed to provide technical and financial support for organic and transitioning farmers.
Categories: Carousel, Grants and Programs, Organic