Historic debt relief program for farmers of color takes hit after discrimination suits

Congress is on the verge of rolling back a significant debt relief program intended to provide aid to farmers of color after the Democratic-led effort hit a roadblock last year following legal challenges brought by white farmers claiming discrimination.  

Democrats are planning to repeal the program in a sprawling economic package the party could pass as early as this week. But there are new plans to put more than $5 billion toward helping farmers whose operations are deemed at “at financial risk,” as well as those who have faced discrimination.  

Specifically, the bill outlines $3.1 billion to help “distressed borrowers of direct or guaranteed loans administered by the Farm Service Agency,” and $2.2 billion for a program to provide assistance for farmers that experienced discrimination in Department of Agriculture (USDA) farm lending programs prior to January 2021. 

Agri-Pulse was first to report the plan, which was tucked away in Democrats’ 700-plus-page Inflation Reduction Act, a mammoth tax, climate and health care plan the Senate passed over the weekend. 

The plan comes more than a year after Congress passed the American Rescue Plan, a coronavirus relief package that President Biden signed into law in March 2021, which included $4 billion in aid for underserved farmers.  

The measure was met with instant praise from advocates last year and seen, in part, as a step by Congress to acknowledge a long history of discrimination that Black farmers and farmers of color have experienced in the nation, particularly by the government.  

“USDA is recommitting itself to gaining the trust and confidence of America’s farmers and ranchers using a new set of tools provided in the American Rescue Plan to increase opportunity, advance equity and address systemic discrimination in USDA programs,” Agriculture Secretary Tom Vilsack said at the time. 

But shortly after the plan was enacted, white farmers brought forward legal challenges, alleging that the effort as discriminatory. Advocates say the legal action has kept the funding from reaching farmers who have been in desperate need of assistance for more than a year.  

Senators pushing for the funding see the new legislation as a way to get financial assistance to farmers in need 

In a statement to The Hill on Wednesday, Sen. Cory Booker (D-N.J.), said he was excited the new bill “clarifies and reappropriates this funding from the American Rescue Plan.” 

“By giving USDA the authority to modify debt for distressed borrowers, we will keep family farmers around the country on their farms. For those farmers, particularly Black farmers, who have suffered USDA discrimination, this legislation sets in motion a process to right those wrongs,” he said. 

He added the move was the result of a “team effort” with Sens. Raphael Warnock (D-Ga.), Debbie Stabenow (D-Mich.), and Vilsack, as well as Senate Majority Leader Charles Schumer (D-N.Y.), to “get aid to these farmers.” 

“This relief will be a lifeline for our farmers who are most at-risk of foreclosure or losing their land, as well as a boost to farmers who have been left behind for decades,” Warnock said in a statement on Wednesday. He called the aid significant “for economically distressed farmers all across Georgia and the country.” 

But some advocates say they were caught off guard by the plan, which they also argue is too broad and could fall short of helping those who need it most. 

“They call it broader,” John Boyd Jr., a civil rights advocate and fourth-generation farmer, told The Hill on Wednesday. “Generally when you use those types of terminology, the resources never seem to reach Black and other farmers of color.” 

“And that’s what we’ve been saying has been the problem the whole time,” he said. 

Black farmers accounted for roughly 14 percent of farmworkers in the nation about a century ago. But USDA data showed Black-owned farms constituted of less than 2 percent of the country’s 2 million farms in 2017, compared to the 96 percent owned by their white counterparts. 

Advocates have attributed much of the decline in Black farmers to the historical discrimination. 

Decades ago, a landmark class-action suit known as Pigford v. Glickman, in which Black farmers alleged racial discrimination in USDA loan programs, reached a $1 billion settlement. 

Another settlement was struck almost a decade later for $1.25 billion, after thousands of Black farmers were found to have been left out of that round of aid after making claims too late, according to data gathered by the Environmental Working Group. 

Advocates also say many Black farmers were shut out of coronavirus aid and farm subsidies handed out under the Trump administration, which largely benefited white farmers. 

“The local implementation of USDA programs and services has never been addressed ever since it was acknowledged to the Pigford class action legislation,” Dãnia Davy, director of land retention and advocacy at the Federation of Southern Cooperatives, told The Hill. 

Booker said on Wednesday that he plans to “work closely with USDA to ensure farmers quickly get the support they have been waiting on and desperately need.” 

The USDA said in a statement on Wednesday that the new provisions in the Inflation Reduction Act “will prove to be helpful in keeping farmers farming and providing assistance to farmers who have experienced discrimination in USDA’s leading programs.” 

The department also added that, through a section in the bill providing the agency with over $3 billion to provide relief for at-risk agricultural operations, it will be able to “provide loan modifications and payments to distressed borrowers with the goal of keeping farmers farming.” 

But advocates have concerns about implementation.  

“Applying for a loan modification is extremely burdensome on rural landowners and farmers, and so I anticipate significant implementation challenges if this program is, in any way, supposed to be for farmers who have been historically underserved, in particular, Black farmers,” Davy said. “That’s going to be a big challenge to implement in a timely fashion, given the threats of foreclosure notices that folks are receiving at this point daily.” 

She also raised issues with what she described as “extremely vague” language detailing aid for farmers facing discrimination the bill. 

“Unfortunately, the definition of discrimination is lacking as well as any protected classes, and so what will discrimination even mean? Who will these adjudicators be, and how will they decipher what discrimination is when there’s no reference to our civil rights, protected classes?” she said. 

She argued the program fails to meet the needs of farmers eligible for aid under the American Rescue Plan who “were really counting on this debt relief to give them a chance to remain competitive in an agricultural system that has been anti-Black since its founding.” 

“It would appear to me that the focus was to avoid the courts, and not to meet the needs of the Black farmers that were promised that debt relief last year,” Davy said of the bill. 

Updated 12:21 p.m.