Many Black farmers claim they face discrimination when applying for government loans.
Black farmers have longed claimed to face discrimination from the government when it comes to lending programs as compared to their White counterparts.
Now, Black farmers, and others who have allegedly faced racial discrimination, can file claims for relief, with the money coming from the Inflation Reduction Act (IRA).
In a press release, Agriculture Secretary Tom Vilsack said, “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.”
Gerren Keith Gaynor of The Grio reported, “Black farmers will undoubtedly seek to claim financial assistance under the program. For decades, they have accused USDA of discrimination and denying them needed loans to keep their land and farms operating.
“The Discrimination Financial Assistance Program was established after the Biden-Harris administration’s initial $4 billion debt relief program for Black and other ‘socially disadvantaged’ farmers came to a halt, due to a class-action lawsuit from White farmers who claimed the program under the American Rescue Plan discriminated against them.”
As a result, Democrats rewrote the language to not include race in the rules of eligibility.
However, the original American Rescue Plan loan assistance remains in Texas court.
Ultimately, Black farmers filed their own lawsuits as a means of pressuring the USDA to continue the program for Black farmers who claimed discriminatory lending processes stopped them from getting the money necessary to keep their farmers afloat.
Gaynor reported, “The latest loan assistance program for which farmers can apply is broader and does not mention race explicitly; however, the administration made clear the program is intended for farmers who faced harm by the USDA.
“After the IRA was signed into law by President Joe Biden in August 2022, the agency took time to select vendor partners and community-based organizations who, by law, will be responsible for educating farmers about the program and providing any assistance throughout the application process. Several of the organizations selected specifically work with Black and Brown farmers.”
The USDA senior advisor said, “We realized the importance of this in terms of the overall equity work at the department, but also in terms of being able to incorporate some needed input from the people that we were trying to help.”
Creating a process to choose the correct vendors “took some time” according to the USDA official.
However, the official said, “a lot of thought went into it because it’s critically important.”
Applications for compensation will stay open until Oct. 31.
The website that farmers, ranchers and forest landowners must visit is 22007apply.gov.
Applicants must prove that they had been discriminated against.
The Grio reported, “The USDA stressed that the Discrimination Financial Assistance Program is not a first-come, first-serve process, and all applications received or postmarked before the October deadline will be considered. Payments will be awarded to recipients shortly after applications are reviewed; however, it’s not clear whether that review process will be by the end of the year or January 2024.”
The USDA senior advisor said, “Secretary of Agriculture says that our goal is to get these out by the end of the year, and we’re working towards that.”
The secretary of the USDA said the organization 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 February, Ximena Bustillo of NPR reported, “Indeed, an NPR analysis of USDA data found that Black farmers receive a disproportionately low share of direct loans given to farmers leaving them behind in a program that is important to their livelihoods. The department itself has long tried to fix these systemic problems, but farmers and advocates remain skeptical that its efforts will ultimately benefit those who need it most.
“The USDA’s lending process, for the last century, is not set up to support nontraditional growers including the farmers of color who face high rejection and withdrawal rates as a result…”
USDA Farm Service Agency Administrator Zach Ducheneaux said, “So it might be you’re a Black farmer that’s operating on heirship property who hasn’t had the benefit of a cooperator technical assistance provider right there on the ground with them to help navigate this. By virtue of the lack of support structure around them, they’re going to come to the application process less prepared.”
Last year, the government gave direct loan payments to only 36 percent of Black farmers.
Supposedly, direct loans are among the easiest to obtain.
Direct payments are meant for those who cannot receive credit anywhere else.
The payments are meant to get land, equipment for farms or to use to operate farmland and keep farmers in business.
However, last year 72 percent of White farmers received direct payments.
Sixteen percent of Black farmers got rejected for direct payments in comparison with four percent of White farmers getting denied the direct loan payments.
Black and Asian American farmers withdrew their applications for direct loan payments at the highest rate, 48 percent.
On the contrary, only 24 percent of White applicants withdrew their loan applications.
Despite President Biden’s efforts to rectify the problem, Black and Asian American farmers were the least successful demographic to get approved for direct loan payments over the past two years.