Farm Debt Relief Now Available for BIPOC Producers

Posted on Thursday, May 13th, 2021 by Guest Blogger
VH Produce in Singer, CA. Photo from USDA.

The most recent federal pandemic relief, The American Rescue Plan, included historic levels of support specifically for farmers of color. This blog is reposted from the National Sustainable Agriculture Coalition (NSAC), of which CalCAN is a member. NSAC advocates for federal policy reform for the sustainability of food systems, natural resources, and rural communities. See the original post here

As farmers all across the country enter the busy season of spring planting, policymakers are busy in the nation’s Capital as well getting ready to roll out important relief provisions included in the latest round of COVID-19 aid. Congress passed its fifth round of relief in response to the coronavirus pandemic – The American Rescue Plan – earlier this spring, which included $5 billion in direct aid for Black, Indigenous, and People of Color (BIPOC) farmers.

The U.S. Department of Agriculture (USDA) is charged with implementing this provision, with the Farm Service Agency (FSA) responsible for distributing the approximately $4 billion in farm debt relief payments for BIPOC producers who have farm loans made directly by FSA or through private lenders (i.e. Farm Credit, ag banks) with USDA guarantees. While payments have yet to be issued to farmers, the new Administration is working quickly to get urgent relief to some of our nation’s most hard-hit and persistently underserved farmers in the country.

USDA recently released more information on how these relief funds would be distributed and what farmers need to know about accessing this relief. Many of the most frequently asked questions are summarized below, with additional information on USDA’s website.

Who is eligible for relief?

All Black, Native American, Alaskan Native, Asian American, Pacific Islander, and  Hispanic/Latino farmers are eligible for relief, so long as they have outstanding debt on any of the following types of FSA loans (as of January 1, 2021):

In order to issue payments to eligible borrowers, farmers must have their demographic information on file with FSA. If you are uncertain of your demographic designation with FSA, call your local Service Center to verify your classification on record. If an update or correction is needed, farmers may either fill out an AD-2047 form (PDF, 234 KB) and return it to your local USDA service center or call them to update your record, including race and ethnicity.

If multiple borrowers are listed on the loan, the loan is still eligible for relief so long as one of the borrowers meets the criteria listed above.

Do farmers need to apply for debt relief?

Debt relief payments will be made automatically and do not require farmers to apply for payment. USDA is in the process of notifying all eligible borrowers that they have loans that are eligible for debt relief. Farmers will need to verify their total outstanding debt and return the form to FSA before payments are issued.

If you believe you are eligible for debt relief and have not received a notification from FSA, first check with your local service center to ensure your demographic information is on file. If an update or correction is needed, you may either fill out an AD-2047 form or contact your local service center to update your record, including race and ethnicity.

What about farmers who don’t have loans with FSA?

Currently, debt relief is only available for farmers who have current outstanding debt with FSA directly, or with an FSA guaranteed lender. However, farmers who are not eligible may be able to benefit from additional assistance from USDA. While USDA estimates that the debt held by BIPOC borrowers through FSA direct and guaranteed loans is roughly $4 Billion, USDA also has approximately $1 Billion that may be able to be used to provide relief for farmers that hold other types of debt. USDA is actively working to establish a process for providing assistance to former borrowers that are socially disadvantaged based on race and ethnicity. Details will be shared as soon as a process is established.

More aid on the way?

In addition to the $4 Billion in farm debt relief payments, Congress authorized an additional $1 Billion to allow USDA to provide additional support for BIPOC farmers. This includes funding to:

  • Provide financial assistance to socially disadvantaged farmers, ranchers, or forest landowners that are former farm loan borrowers that suffered related adverse actions or past discrimination or bias in USDA programs
  • Support outreach, mediation, financial training, capacity building training, cooperative development training and support, and other technical assistance for BIPOC producers
  • Provide grants and loans to improve land access for socially disadvantaged farmers, ranchers, or forest landowners
  • Establish an equity commission within USDA to address racial equity issues
  • Conduct agricultural research, education, and extension, as well as scholarships and internship programs, at minority serving academic institutions (i.e. 1890s, 1994s, HSIs)

USDA is in the process of soliciting input from stakeholders and BIPOC farmers on how best to utilize this additional funding, including how to provide relief for farmers who have faced discrimination in accessing USDA programs. NSAC will continue to provide updates on how this funding will be prioritized. In the meantime, we encourage farmers and stakeholders within the sustainable agriculture community to check out our BIPOC partners to learn more about what is truly needed to lift up and support these communities:

Additional Resources

USDA American Rescue Plan Debt Payment – Overview

USDA Blogpost – FAQs on American Rescue Plan Debt Relief for Socially Disadvantaged Borrowers (April 2021)

USDA American Rescue Plan Debt Payment – Frequently Asked Questions (English):

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