Democrats pivot on race-based loan relief as white farmers sue

Congress quietly replaced a farm loan assistance program for racial minorities that was threatened by legal challenges from white farmers.

The new provision no longer mentions race. Instead, it offers loan relief to struggling borrowers and additional help to farmers, ranchers and foresters who have faced discrimination. Change comes later white farmers claimed that the program, established by the 2021 US bailout, discriminated against them by specifying that loan assistance was only available to socially disadvantaged groups.

Supporters of the pivot — including some black lawmakers — say the workaround is more legally airtight and will get help quickly to groups in need. Yet some black farmers fear this is just another example of the Department of Agriculture leaving them behind after generations of discrimination that have made it harder — and sometimes impossible — for them to get loans.

“When you put black farmers with everyone else, we come in last based on all numbers and all history,” said John Boyd Jr., president of the National Black Farmers Association.

Democrats Climate, Tax and Healthcare Act (Public law 117-169), provides $3.1 billion for loan relief to subprime borrowers—encompassing distressed farmers, regardless of minority status—and $2.2 billion for farmers discriminated against in lending. the USDA. For the latter program, farmers outside of race-based socially disadvantaged groups, such as white women and members of the LGBTQ community, could be eligible. The Department of Agriculture said it intended to get the aid to farmers as quickly as possible.

As part of the US rescue plan (Public Law 117-2), socially disadvantaged farmers were to get $4 billion in loan relief. The funds were meant to correct the Department of Agriculture’s historic refusal to lend to ethnic minorities on the basis of race, saving dozens of black farmers with unsustainable debts from foreclosure.

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Glenn Morris watches his corn being unloaded at the elevator on October 11, 2021 in Princeton, Ind. Morris is one of two black farmers who still work full-time in Lyles Station, an area of ​​Indiana once dominated by black farmers.

There are fewer than 50,000 black farmers in the United States, down from 950,000 at its peak in 1920. Supporters warn that many remaining farmers are hanging by a thread.

“Debt relief was a contract between black farmers, farmers of color, and the USDA,” Boyd said, “and they broke that deal by terminating it.” He added that he was considering filing a new lawsuit based on the cancellation of the program.

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Last legal resort

The new language has been in the works for more than a year, a Senate aide said, but was only added in a director’s amendment before the Senate voted.

White farmers who sued the Biden administration for discrimination through the Wisconsin Institute for Law & Liberty applauded the repeal of previous aid to socially disadvantaged groups.

“The devil may be in the details, of course, and we will be monitoring the program closely to ensure the USDA adheres to constitutional principles of non-discrimination,” said Rick Esenberg, president and general counsel of WILL, in a press release.

Some underrepresented farmer groups are optimistic the new program will help them and avoid legal hurdles that have blocked US bailout assistance.

“Immediate relief just needs to get to the people most in need,” said Kari Jo Lawrence, executive director of the Intertribal Agriculture Council.

Lloyd Wright, who grew up on a family farm in Virginia and served as director of the USDA’s Civil Rights Office in the 1990s, said eliminating the previous section of the US bailout made the program even better .

“I don’t think they could have done a better job writing it,” Wright said, adding that the lawsuits against the white farmers who blocked the aid were “going nowhere.”

Prove discrimination

Boyd said he was concerned that this funding would be used by other farmers, such as white women.

This scenario sounds plausible to Cesar Escalante, a professor of agricultural and applied economics at the University of Georgia. Compiling and submitting evidence of discrimination has been challenges for black farmers in the past for reasons including lack of access to documents and computer literacy, Escalante said.

“So even though more racial minority farmers are discriminated against, the majority cannot argue and prove their case,” Escalante said. “But more women farmers could do it, even if their absolute number is lower than that of certain racial minority groups.”

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But many black farmers have documented histories of discrimination, Wright said, especially those whose family businesses began before 1964, when the Civil Rights Act made segregation illegal. He said Native American farmers should also be able to easily prove they faced discrimination, since settlers took their land in the first place.

The wording of the law directs the USDA to create a program to determine who has been discriminated against, said Stephen Carpenter, an attorney with the Farmers’ Legal Action Group – and ‘it will be difficult for them to do so’ .

“Thumb in the dike”

Proponents of the new program argue the alternative would have been no help had white farmers won their case against the Biden administration. That way, they say, distressed black farmers and other racially disadvantaged groups will still be eligible for loan modifications, as well as discrimination assistance.

But Boyd said black farmers in his community feel left out by an administration they helped elect.

“It’s going to be tough for me to go out there and ask our black farmers in the midterm elections to vote for people who aren’t helping,” he said.

Sen. Cory Booker (DN.J.), who sits on the Agriculture, Nutrition and Forestry Committee and helped draft the Democrats’ bill provision with the senator. Raphael Warnock (D-Ga.), says he understands why some black farmers are skeptical given the history of the federal government failing to deliver on its promises.

“I wish right-wing extremists and activist judges hadn’t delayed the debt forgiveness we passed in the US bailout,” Booker said in a statement. “But it was clear that these resources were going to be tied up in court for years, with an uncertain outcome in the end.”

Legislation is key to reducing the debt burden that threatens to push black farmers out of business, said Lorette Picciano, executive director of the farmers’ network Rural Coalition. “It’s likely that these farmers will get a resolution much faster” than they would have without the wording of the bill, she said.

Many black farmers who approve of the new wording in the bill recognize that more is needed to make up for years of discrimination by the federal government. But Wright said he hoped it would at least prevent the country from losing black producers who now make up less than 2% of all farmers in the country.

“This bill was not designed to do that,” Wright said. “This bill as it stands can put an inch in the dike so that we don’t lose all the others.”

To contact the reporter on this story: Maeva Sheehey in washington at [email protected]

To contact the editors responsible for this story: Robin Meszoly at [email protected]; Sarah Babbage at [email protected]