A Florida federal judge imposed a nationwide ban on the USDA loan forgiveness program, which was incorporated into the American Recovery Act, which offered $ 4 billion in loan forgiveness on 120% of USDA’s outstanding loans to black farmers and other socially disadvantaged manufacturers. This is the first injunction against the program, following an interim restraining order issued by a federal judge in Wisconsin earlier in June.
The US Rescue Plan Act 2021 provision provides for loan forgiveness of up to 120% of the loan amount for some farmers and ranchers. At least several federal lawsuits have been filed against Agriculture Secretary Tom Vilsack to block aid provided by the US Rescue Plan Act 2021, as regulations specifically prohibit white farmers from participating in the program.
Wen Fa, an attorney for the Pacific Legal Foundation, who has asked a Florida court for an injunction, says they asked the courts to either forgive loans to everyone or not to forgive anyone. Congress approved the program at $ 4 billion for 17,000 people, whereas if it were extended to all USDA lenders, regardless of skin color, it would cost $ 400 billion, Fa says.
In Florida’s injunction, US District Judge Marcia Morales Howard notes that if implemented, the loan forgiveness program “will result in an inevitable one-time act of discrimination that cannot be remedied by an award of pecuniary damage or other compensation in this case.
“It also cannot be canceled after the fact, since the government has no opportunity to collect the debt cancellation after it is paid. The impact of such a large-scale debt relief program on the Claimant in the near future will not be measurable, if at all, ”the judge explains.
In the Wisconsin case, US District Judge William Grisbach, who was appointed to a federal court by then President George W. Bush, says there is “no evidence of deliberate discrimination by the USDA.”
Fa says the racial dimension is very clear about this, and in the past, the Supreme Court has consistently ruled that the Constitution protects against the use of race less than the program stipulates. “I have not seen a single program in recent history that would make the race such an important factor. I think this is a very extraordinary congressional measure that sees race as the defining characteristic for loan assistance, ”Fa says.
White farmers claim to be left out
In May, the Pacific Legal Foundation filed a lawsuit on behalf of a Florida farmer who was unable to apply for a farm loan forgiveness because the program excludes whites. Scott Wynn is a lifelong farmer who runs Wynn Farms in Jennings, Florida and has been producing sweet potatoes, corn and cattle since 2006. However, COVID-19 has hit family finances hard. The plummeting beef prices and inadequate aid and supplies for growing sweet potatoes have meant a drop in income, almost all of which went towards paying off a $ 300,000 federal agricultural loan on a farm loan.
A similar lawsuit was filed by Jarrod McKinney of the Texarkana region on behalf of the PLF. McKinney got his start in agriculture about eight years ago with a federal loan for seed farmers. Like many farmers in the Texarkana region, McKinney breeds cattle and today houses 60 pairs. Like many farmers facing economic hardship as a result of the pandemic, McKinney was hopeful when he heard about the farm loan forgiveness clause included in the recent COVID-19 law. However, his hope was replaced by disappointment when he learned that he was not eligible for the federal program because he was white.
In 2019, the USDA Agricultural Services Agency provided McKinney with another $ 185,000 loan to finance his agricultural operations. COVID hit him just a year after he got his second loan, making it extremely difficult for him to keep up with his regular farm expenses, let alone pay off the loan, and his outstanding balance is currently $ 180,000.
“Today’s ruling enforces the basic pillar of our Constitution: the government cannot treat people unevenly based on immutable characteristics such as race,” Fa says. “The government cannot allow some people to participate in federal programs, while it forbids others only on the basis of their skin color. The courts have rightly rejected such discrimination in the past and should do so now. ”
Minority organizations remain unwavering
One of the leading proponents of the bill in Congress, Chairman of the House Agriculture Committee David Scott, Georgia, supports the loan forgiveness program as a way to keep remaining black farmers. “The very survival of black farmers is at stake — and that would be an unforgivable sin because we, as black slaves, have done the hard work and laid the foundation of America’s great agricultural system for over 200 years under the onslaught of predators for free. the whips of the slaveholders, says Scott.
John Boyd Jr., founder and president of the National Black Farmers Association, says he will continue to advocate forgiveness of loans due to past discrimination. “I will fight until the US Supreme Court,” he promises.
On behalf of the Rural Coalition, the Inter-Tribal Agriculture Council, the North Carolina Black Lawyers Association’s Land Loss Prevention Project, and 23 other farming, rural, environmental, health and civil rights groups, the South Poverty Law Center has filed an application Amicus short asking the Wisconsin federal court to authorize a $ 4 billion forgiveness loan to “correct decades of injustice, systemic racism, and recognized discriminatory behavior by the federal government.”
“Debt cancellation is something that minority farmers desperately need as they recover from the damage COVID-19 has disproportionately caused to their businesses and families,” said Keisha Stokes-Hough, senior oversight attorney for the Economic Justice Project in Southern Poverty. Legal center.
The organizations note that the U.S. Department of Agriculture allocated $ 9.2 billion to farmers in 2020 as part of the Coronavirus Food Assistance Program. Less than 3% of this aid went to a category of producers identified by the USDA as underserved by federal agricultural programs and which includes colored farmers. With this loan forgiveness plan, Congress directed the USDA to help poor farmers.
Groups supporting the memo say the delay in the distribution of these funds puts more BIPOC farmers at risk of bankruptcy or further falling behind their white counterparts. The summary contains statements by BIPOC farmers who will suffer irreparable damage due to the delay in federal support.
However, Fa notes that while the government has argued that while white farmers are more likely to have larger farms and, in turn, be able to withstand the COVID-19 pandemic, this leaves out other small farms that are also could suffer. economic losses due to COVID-19. A minority farmer who took up farming in 2020 could have all debts written off, while a white farmer who was really hit by the pandemic is categorically not eligible for a loan forgiveness.