USDA Updates Reporting On Usage In Cuba Of MAP/FMD Funding Authorized By 2018 Farm Bill
/In 2018, legislative advocates maintained that inserting a Market Access Program (MAP) and Foreign Market Development (FMD) provision in the Farm Bill was critical to “laying the groundwork” for increasing exports of agricultural commodities and food products to the Republic of Cuba. Statements from members of Congress included: “… an important first step to regaining our presence in Cuba.” Yet, there was not one application to the United States Department of Agriculture (USDA) in 2018 or 2019.
Most observers reasonably concluded that legislative advocates- within the United States Congress and organizations located in Washington DC and located outside of the beltway would have prominently teed-up at least one high-profile applicant to publicize in advance they would use the provision if it became law or at least one high-profile applicant to immediately and publicly request funding when the Farm Bill became law on 21 December 2018.
The most significant impact of a shockingly low number of MAP/FMD requests in 2018, 2019, 2020, and 2021 is what the lack of interest portends for other legislative efforts in the United States Congress to rescind prohibitions upon the provision of payment terms for agricultural commodity and food product exports from the United States to the Republic of Cuba.
Use to date of USDA MAP/FMD Republic of Cuba-focused funding provisions in the 2018 Farm Bill has been anemic. Since 2018, One entity has used MAP funding in the Republic of Cuba. No entity has used FMD funding in the Republic of Cuba. The USDA reported no applications were rejected.
Since 2019, a total of eight applications were received by the USDA to use MAP and/or FMD. According to the USDA, “Although the table indicated nine expressions of interest over two years, these represent fewer than nine organizations as some of the organizations applied in multiple years. The earlier table only included those entities that expressed interest in Cuba directly, not anyone that sought to add Cuba to a regional program.”
According to the USDA, at least one participant in 2021 and 2020 sought to add the Republic of Cuba to a regional program for MAP, but none for FMD. No entity pursued or was rejected for activities in the Republic of Cuba through a regional program. In some respects, that some entities applied more than once, but did not ultimately use MAP and/or FMD in the Republic of Cuba is more consequential because it begs the question- why did the entities apply, but not choose to use MAP and/or FMD in the Republic of Cuba?
One entity received MAP funding (US$60,000.00) in the Republic of Cuba- Denver, Colorado-based Potatoes USA which in November 2020 delivered to the Republic of Cuba 33,118 pounds of potato seeds valued at US$44,760.00. Sample costs are ineligible for MAP or FMD funding.
In 2020, one (1) entity applied to use, but did not use FMD funding and four (4) entities applied to use MAP funding while one (1) entity (Potatoes USA) used MAP funding. From the USDA, “… any unspent funds would normally remain in participants’ agreements, available for the agency to approve for plans a participant submits in a future year.”
In 2021, no entity applied to use FMD funding and three entities applied to use MAP funding, but no entity has yet used MAP funding. From the USDA, “Most MAP programs operate on a January to December year, however, some run on a July to June year. The regulations allow groups to continue already approved activities up to thirty days after the end of the program year. Thus, the latest a participant could continue an activity funded by MAP 21 would be July 30, 2022, if their MAP 21 program began June 1, 2021. A participant would have until the end of January 2022, if their MAP program began January 1, 2021. The MAP regulations allow a participant to file claims up to six months after the end of the program year.” In 2021, sixty-seven (67) entities received funding for MAP and twenty-one (21) entities received funding for FMD.
USDA Accepting Applications for FY 2021 Export Programs
“The U.S. Department of Agriculture’s Foreign Agricultural Service is accepting applications from eligible organizations for fiscal year 2021 funding for five export market development programs. FAS recently published the FY 2021 Notices of Funding Opportunity for the Market Access Program, Foreign Market Development Program, Technical Assistance for Specialty Crops Program, Quality Samples Program and Emerging Markets Program. The application deadline for the five programs is June 26, 2020.
Under the Market Access Program, USDA provides competitive, cost-share assistance to U.S. exporters and agricultural, fish, and forest product trade organizations for international marketing and promotion of U.S. commodities and products. More information about the program and the FY 2021 funding opportunity is available at: https://www.fas.usda.gov/programs/market-access-program-map.
Under the Foreign Market Development Program, USDA partners with nonprofit agricultural and forest product trade associations to build longer-term international demand for U.S. commodities. More information about the program and the FY 2021 funding opportunity is available at: https://www.fas.usda.gov/programs/foreign-market-development-program-fmd.”
What Is FMD & MAP?
The USDA does not provide any payments to selected applicants in advance of the applicant making disbursements. The USDA provides payment upon receipt of an invoice from the applicant. The invoices are audited by the USDA and a claw back of payments is permitted. Any Republic of Cuba-related invoice is likely to receive additional scrutiny due to an amendment to the Farm Bill submitted by The Honorable Marco Rubio (R- Florida), a member of the United States Senate.
MAP: “Through the Market Access Program (MAP), FAS partners with U.S. agricultural trade associations, cooperatives, state regional trade groups and small businesses to share the costs of overseas marketing and promotional activities that help build commercial export markets for U.S. agricultural products and commodities.”
“MAP reaches virtually every corner of the globe, helping to build markets for a wide variety U.S. farm and food products. FAS provides cost-share assistance to eligible U.S. organizations for activities such as consumer advertising, public relations, point-of-sale demonstrations, participation in trade fairs and exhibits, market research and technical assistance. When MAP funds are used for generic marketing and promotion, participants must contribute a minimum 10-percent match. For promotion of branded products, a dollar-for-dollar match is required. Each year, FAS announces the MAP application period and criteria in the Federal Register. Applicants apply for MAP through the Unified Export Strategy (UES) process, which allows eligible organizations to request funding from multiple USDA market development programs through a single, strategically coordinated proposal. FAS reviews the proposals and awards funds to applicants that demonstrate the potential for effective performance based on a clear, long-term strategic plan.”
FMD: “The Foreign Market Development (FMD) Program, also known as the Cooperator Program, helps create, expand and maintain long-term export markets for U.S. agricultural products. Under the program, FAS partners with U.S. agricultural producers and processors, who are represented by non-profit commodity or trade associations called “cooperators,” to promote U.S. commodities overseas.”
“The FMD program focuses on generic promotion of U.S. commodities, rather than consumer-oriented promotion of branded products. Preference is given to organizations that represent an entire industry or are nationwide in membership and scope.
FMD-funded projects generally address long-term opportunities to reduce foreign import constraints or expand export growth opportunities. For example, this might include efforts to: reduce infrastructural or historical market impediments, improve processing capabilities, modify codes and standards, or identify new markets or new uses for the agricultural commodity or product.
Each year, FAS announces the FMD application period and criteria in the Federal Register. Organizations apply for the FMD program through the Unified Export Strategy (UES) process, which allows applicants to request funding from multiple USDA market development programs through a single, strategically coordinated proposal. FAS reviews the proposals and awards funds to applicants that demonstrate the potential for effective performance based on a clear, long-term strategic plan.”
Value Of MAP/FMD
For the United States business community, the MAP/FMD amendment to the Farm Bill was significant, but more likely to provide greater financial value to the government of the Republic of Cuba than to United States food product and agricultural commodity exporters using provisions of the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000.
The likelihood of a value to United States taxpayers, as members of the United States Senate have posited, of US$28.00 returned for every US$1.00 in expenditures of MAP/FMD throughout the world, and now including the Republic of Cuba, will be challenging to measure- but it will be important to measure and the USDA should focus upon the cost-benefit analysis.
