Wedding Planner, Caterer, “Brand Builder”: Trump’s Food Aid Program Is Paying $ 100+ Million to Unlicensed Dealers
Isaac Arnsdorf (ProPublica) 21 May 2020
Contractors with no experience in food distribution are looking for suppliers on Facebook while some food banks scramble to find desperately needed deliveries.
A food relief program championed by President Donald Trump and his daughter Ivanka is relying on some contractors who lack food distribution experience and aren’t licensed to deal in fresh fruits and vegetables.
The contractors on Friday began delivering boxes containing fresh produce to food banks and other nonprofits. Forty-nine out of the 159 contractors picked by the U.S. Department of Agriculture to deliver boxes containing produce don’t have a requisite license from the same agency, according to a search of the USDA’s database using the information released about the contractors.
Some of the contractors are established companies, and many food banks told ProPublica they’re successfully and gratefully receiving shipments. But other contractors have eclectic backgrounds with little track record in food distribution, such as a wedding planner, a caterer and a “brand builder.”
As a result, some food banks are left scrambling for shipments or even callbacks.
“We thought this would work very well, and we really needed the food due to rising unemployment and business closings,” said Pamela Irvine, CEO of Feeding America Southwest Virginia, which serves the poorest and most rural counties in that state. The USDA, she said, “had money and wanted to respond quickly, which they should have because you saw all this produce grounded and milk being dumped. However, they didn’t think about how that product should end up on a table somewhere and didn’t communicate and didn’t have a process in place for bidders to understand.”
The awards to firms for which no licenses could be found amount to $105.3 million, about 15% of the total for produce boxes. The USDA also hired contractors for boxes containing meat and dairy, at a total cost of $1.2 billion for six weeks, with the possibility of extending.
The licenses under the Perishable Agricultural Commodities Act, or PACA, are required for wholesalers, processors, truckers, food-service firms and anyone else who buys or sells more than 2,000 pounds of fresh or frozen fruits and vegetables a day, according to the USDA’s website.
“Much like you need a driver’s license to operate a vehicle, the law requires that you have a PACA license to operate a produce business,” the agency’s website says. “A PACA license is proof to your customers and suppliers that you are a serious business person who can be trusted to honor the terms of your contracts.”
The licenses give vendors a way to resolve payment disputes, and many producers won’t sell to someone who isn’t licensed.
“We don’t do business with people without a PACA license,” said Noah Murguia, the CEO of Murguia Fruit, an orange wholesaler in California. Murguia said he is selling oranges to licensed contractors in the program but doesn’t understand why anyone without a license would be allowed to participate. “To me, it’s a big joke,” he said.
The USDA’s official solicitation and application form don’t mention PACA licenses. An agency spokesman said contractors that don’t already have one will need to get one. Continue Reading...
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