What will happen to USDA’s loan forgiveness for BIPOC farmers?

The TRO was a response to a lawsuit by a dozen white farmers alleging racial discrimination in being denied access to these funds. This despite the fact that almost 99 percent of earlier pandemic debt relief for farmers, amounting to some $40 billion in benefits, was distributed by USDA to white farmers, according to Environmental Working Group. Plaintiffs alleged that the U.S. Constitution forbids discrimination by the federal government “against any citizen because of his race,” according to their complaint. It’s a claim the judge acknowledged in issuing the TRO, writing in his decision that it’s “always in the public interest to prevent the violation of a party’s constitutional rights.”

The action parallels goings-on over at the Small Business Administration, which quietly “put a pause on processing [preferential grant] applications from women, people of color, and veteran-owned” restaurants and related businesses last month, as lawsuits from right-wing groups alleging harm to white men—including from the same Wisconsin group suing the USDA over BIPOC loan forgiveness—began to proliferate.

Section 1005 of ARPA was intended to provide farm loan assistance for socially disadvantaged farmers and ranchers, and to give USDA a new tool to address decades of racism and inequity in its programs. Some of the language was inspired by the Emergency Relief for Farmers of Color Act and by the Justice for Black Farmers Act, both introduced by members of the Congressional Black Caucus. “Thousands of Black farms have been lost as a result of discriminatory policies of the past,” wrote attorney Greg Francis in an email. Francis represented Black farmers in the Pigford v. Glickman class action racial discrimination lawsuit against USDA in 1999. Section 1005, said Francis, was a “long overdue effort to level the playing field after generations of policies that systemically disenfranchised thousands of hard-working Black farmers.” 

For some interested parties, however, the provision was both too little too late, and predictably easy to strike down. Lloyd Wright was USDA’s director of civil rights before he retired in 1998. He said he credited the White House and senators in the Black Caucus—not USDA or ag secretary Tom Vilsack—for getting the provision added to ARPA, and that it was an important step in the right direction. However, he wasn’t surprised that any plan to offer aid to BIPOC farmers had ground to a halt. 

“It’s consistent with everything else that’s been done to Black farmers; they get told to wait and normally ‘wait’ means ‘never,’” he said. By his estimates, only about 6 percent of Black farmers would actually be helped by ARPA’s Section 1005. “What about the other 94 percent?” he asked (while allowing that other disadvantaged farmers were deserving of assistance as well).

Wright believes the loan forgiveness could have been rolled out sooner. “But [USDA] sat around and waited for long enough that it got stopped,” he said. The agency apparently needed time to certify that BIPOC farmers were, in fact, BIPOC farmers. However, said Wright, the 2008 Farm Bill included a provision that required the agency to collect data on race and gender in addition to more standard information like county and services provided. “If Vilsack had implemented that back then, the department would have had all that information in the system already, and they could have paid these things out in a month,” said Wright.

Section 1005 stipulates that USDA will pay up to 120 percent of loan balances for qualifying producers, on loans issued by the Farm Service Agency; 100 percent is earmarked for the loan balance itself, 20 percent is to pay off any tax liabilities or other fees associated with it. USDA called the provision “historic,” with Vilsack saying it was aimed at regaining the trust of BIPOC farmers by “increas[ing] opportunity, advance[ing] equity and address[ing] systemic discrimination in USDA programs.” To Politico, USDA vowed to “forcefully defend” the provision against the lawsuit. 

Although she believes Section 1005 is worth “vigorously defending,” Tracy Lloyd McCurty, executive director of the Black Belt Justice Center, doesn’t think it goes far enough. McCurty agrees with Wright that only a small fraction of Black farmers will be helped by the provision, and that much more relief is needed to assist legacy farmers still in debt after the $1 billion+ Pigford ruling. (Payout of the settlement proved insufficient relief for some farmers; others had their claims denied.) 

“The Pigford lawsuit left the vast majority of Black farmers … in unconscionable debt [with] no legal recourse to save their family farms,” McCurty wrote in a statement for The Counter. One such farmer family, from Hawkinsville, Georgia, had foreclosure proceedings initiated against them back in 2011 by USDA, “forcing the family to take out a loan with a private bank. … The family still owes over $100K and will not be eligible for debt cancellation under the American Rescue Plan Act.” 

A lawyer for the Wisconsin Institute for Law & Liberty (WILL), which filed the lawsuit on behalf of the 12 white farmers, told the Milwaukee Journal Sentinel that he believed the Biden Administration was “radically undermining bedrock principles of equality under the law” and that the court’s decision to temporarily halt loan forgiveness was recognition that “the federal government’s plan to condition and allocate benefits on the basis of race raises grave constitutional concerns and threatens our clients with irreparable harm.”

In response to the TRO and the lawsuit that precipitated it, 20 organizations representing the interests of BIPOC farmers issued a statement in which they decried “undemocratic actions designed only to frustrate and defeat the justice long denied to BIPOC farmers and ranchers and their communities.” Further delaying payment to BIPOC farmers made disproportionately vulnerable—not only by Covid shutdowns but also by USDA policies and practices that denied them access to credit, conservation, marketing, and cooperative development resources—will only damage them further, the group maintained.

“I wasn’t optimistic about [Section 1005] to begin with,” said Wright. “I hate to be right.”