USDA Opens Enrollment for Discriminatory Loan Debt Relief

by Colter Brown

USDA on Friday opened the application process for farmers, livestock producers and forest landowners who experienced discrimination in USDA’s farm-lending programs.

USDA also cautioned farmers and landowners about possible scammers, adding there are no fees or costs to apply for the debt aid even though some groups claiming to be law firms and others have been trying to recruit farmers to sign retainers or scam them out of funds.

Last year Congress added Section 22007 to the Inflation Reduction Act to provide $2.2 billion in financial assistance to farmers, ranchers and forest landowners who experienced discrimination in USDA loan programs. The provision was created after a similar program targeting debt relief for minority farmers in the American Rescue Plan was blocked in federal court by white farmers who sued over the program.

Under the current program, producers and landowners who experienced discrimination in USDA loan programs before Jan. 1, 2021, are eligible to apply for relief. That includes producers who have USDA loan debts that were subject to discrimination as well.

“The opening of the application process is an important step in delivering on our commitment of providing financial assistance to those who faced discrimination in USDA farm lending, as swiftly and efficiently as possible,” Agriculture Secretary Tom Vilsack said. “USDA will continue to work with our national vendor partners and community-based organizations to make sure eligible farmers, ranchers, and forest landowners have clear information about what is available to them, how to apply, and where to obtain assistance with their questions at each step of the way.”

In noting the opening of applications for the program, USDA stated in its news release that the department “has become aware of some lawyers and groups spreading misleading information about the discrimination assistance process, pressuring people to sign retainer agreements, and asking people to fill out forms with private and sensitive information.”

Yet, the application process is free for producers, and applicants are not required to retain attorneys. USDA added the program is set up to pay loan debts and will not pay attorney fees for people who apply. “The amount of financial assistance will not be increased for those claimants who are represented by an attorney,” USDA stated.

The administration may be in a race to initiate the program. House Republicans in their USDA appropriations bill for fiscal year 2024 would rescind the funding for loan cancellations. That funding bill passed out of committee last month on a party line vote but has not been taken up by the full House.

A group of Democratic senators last December introduced a bill that would remove tax liability for producers under Section 22007, but that bill has not advanced in the Senate or House.

The application process is open now until Oct. 31, 2023. Farmers, ranchers and forestry owners can apply online or go to their local USDA service center. Under USDA’s timeline, applications will be reviewed in November and December with payments reaching producers “soon thereafter,” USDA stated. The department also noted that applications are not paid on a first-come, first-served basis, but all the applications received before Oct. 31 will be reviewed.

To help with applications, USDA has connected with several major organizations to assist producers with the program. More details on those groups can be found on the website.

Separately, a national administrator, the Midtown Group, is responsible for program oversight and will have a national call center to help support producers as well.



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