Farm Aid

According to the Farm Aid 2020 tax filing (IRS Form 990, Schedule M), Farm Aid reports receiving in-kind donated auction items on which it placed a value of $60,853. In addition, according to the Farm Aid audit of December 31, 2020 (Note 9, In-Kind Services and Donated Materials), Farm Aid received in-kind services and donated materials during 2020 on which it placed a value of $8,503.

[Note: CharityWatch generally excludes the value of in-kind (non-cash) donations of goods and services from its calculations of Program % and Cost to Raise $100. More information on how grades are calculated and the treatment of in-kind donations can be found on the Our Process page.]

According to the Farm Aid audit of December 31, 2020 (Note 14, Related Party Transactions):

"The Organization paid a contractor, controlled by a board member, a total of $113,034 for film production costs which is recorded in facility rentals and production costs under festival and special events on the [audited] statement of functional expenses for the year ended December 31, 2020. Additionally, $7,010 due from this contractor for an overpayment made by the Organization is included in accounts receivable at December 31, 2020."

In addition, according to the Farm Aid 2020 tax filing, Farm Aid reports re: the existence of a family or business relationship among officers, directors, trustees, or key employees that Willie Nelson and Lana Nelson have a "family relationship," and Willie Nelson and Mark Rothbaum have a "business relationship" (IRS Form 990, Schedule O re: Form 990 Part VI, Section A, line 2).

Willie Nelson is reported as "Chairman/Director," Lana Nelson is reported as "Secretary/Director," and Mark Rothbaum is reported as a Director. Farm Aid reports having 10 voting members on its board at year-end 2020 (IRS Form 990, Part VII, Section A & Part VI, Section A).

According to the Farm Aid audit of December 31, 2020 (Note 8, Paycheck Protection Program Loan):

"On April 30, 2020, the Organization received a PPP loan established by the SBA [Small Business Administration] under the Coronavirus Aid, Relief and Economic Security Act ('CARES Act') in the amount of $175,450. The loan and accrued interest are forgivable provided that the Organization uses the loan proceeds for eligible purposes (including payroll and employee benefits) within a given time-period and maintains a certain employee head count level.

"The Organization intends to use the loan proceeds for purposes consistent with the PPP and believes that the Organization's use of the loan proceeds will meet the conditions for forgiveness of the loan. The Organization will record the amount of forgiveness as a gain when legally released by the lender. ... On September 22, 2021, the Organization received full forgiveness of the PPP loan and the accrued interest from the bank."

According to the Farm Aid audit of December 31, 2020 (Note 2 re: Subsequent Events):

"The Organization's management has evaluated the effect which subsequent events may have on these [audited] financial statements. Management's evaluation was completed on November 10, 2021, the date these financial statements became available to be issued. On April 1, 2021, the Organization received a Paycheck Protection Program ('PPP') second draw loan of $229,344 granted by the Small Business Administration ('SBA') under the Consolidated Appropriations Act, 2021. All or a portion of the loan and accrued interest may be forgivable based on the amount of qualifying expenses incurred and demonstration of at least a 25% reduction in gross receipts between comparable quarters as compared to the previous year.

"On March 18, 2021, the Organization received a $2,700,000 preliminary distribution from a revocable trust (the 'Trust') of which the Organization is named a beneficiary. On October 28, 2021, the Organization received an additional distribution of $4,500,000 from the Trust. Uncertainty exists regarding the status of certain assets held by the Trust, including on-going probate proceedings. The trustee's best estimate of the amount of remaining potential distributions to the Organization are approximately $2,250,000 which is subject to change as the administration process progresses."

According to the Farm Aid audit of December 31, 2020 (Note 15, Uncertainty Regarding the Impact of COVID-19):

"The Organization is subject to risks and uncertainties as a result of the current COVID-19 pandemic. The COVID-19 pandemic has presented a substantial public health and economic challenge around the world and is affecting the U.S. economy and other economies worldwide. The full extent to which the COVID-19 pandemic may impact the Organization depend[s] on future developments that are highly uncertain and may not be accurately predicted, including the duration and severity of the pandemic. The Organization is carefully monitoring the situation and evaluating its options during this time. No adjustments have been made to these [audited] financial statements as a result of this uncertainty."