Forgiveness of loans to black farmers begins in June

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The $ 4 billion debt write-off allowed for black farmers and other disadvantaged farmers will begin in June, according to the report. funding notification loan payment proposal announcement to help approved as part of the American Rescue Plan developed as part of the COVID Rescue Program earlier this year. An estimated 16,000 farmers may be eligible for assistance.

The USDA expects payments to begin in early June and continue on an ongoing basis. Eligible Direct Loan Borrowers will begin receiving debt relief letters from the FSA in the mail on a regular basis starting the week of May 24th. After careful examination, eligible borrowers must sign the letter when they receive it and return to the FSA. (You can see a more detailed chronology here.)

A follow-up notice regarding guaranteed loan balances and direct loans that are no longer secured and which were previously referred to the Treasury for debt collection for offset, will be published within 120 days.

“The US bailout plan has enabled the USDA to implement historic debt relief for disadvantaged farmers and ranchers since June,” said Agriculture Secretary Tom Vilsack. “USDA reaffirms its commitment to building the trust of American farmers and ranchers by using a new set of tools in the American Rescue Plan to empower, advance equity, and address systemic discrimination in USDA programs.”

Section 1005 ARPA grants funding and authorization to the USDA to repay up to 120% of a direct and guaranteed outstanding loan as of January 1, 2021 for disadvantaged farmers and ranchers. The 120% fee represents the full cost of the loan, including 100% of the loan balance as of January 1, 2021, and a 20% refund is available for tax liabilities and other charges related to debt repayment. Any payments made by borrowers from January 1st will be refunded in full.

Connected: Demand for forgiveness loan to black farmers

For much of USDA history, socially disadvantaged farmers and ranchers have faced discrimination – sometimes openly and sometimes through deeply rooted rules and policies – that have prevented them from reaching the same level as their counterparts who do not face discrimination. these documented acts of discrimination. USDA explains.

Over the past 30 years, several major civil rights lawsuits have paid farmers compensation for specific acts of discrimination, including the cases of Pigford I and Pigford II, Kipsigle and Garcia. “However, these settlements and other related activities did not affect the systemic and cumulative effects of discrimination over several decades, which are now beginning to be addressed in the American Rescue Plan,” adds the USDA.

Members of disadvantaged groups include, but are not limited to, American Indians or Alaska Natives; Asians; Blacks or African Americans; Indigenous people of Hawaii or other islands in the Pacific Ocean; and Hispanics or Hispanics. The Minister of Agriculture will determine on a case-by-case basis whether additional groups fall within this definition in response to a written request with additional explanation.

Eligible loans within the announcement are specific outright loans under the Farm Loan and Farm Warehouse Loans programs.

This initial announcement includes all eligible direct loan borrowers except those who no longer have collateral or have an active farming business. “These borrowers often have more complex cases and may not have the same opportunity to invest in their farms to manage their tax liabilities,” the note reads. “The FSA expects about 5% of eligible direct borrowers to be considered in these cases.”

ARPA Sections 1005 and 1006 provide the USDA with new tools to address what it calls “long-standing injustice for disadvantaged borrowers.”

The American Rescue Plan has allocated more than $ 1 billion for a variety of purposes, including guidance on heir ownership, credit management, and the establishment of an Equity Commission that will identify and propose solutions to address and eliminate longstanding discrimination and obstacles faced by USDA staff. clients. , programs and services. USDA senior management spent those first 100 days consulting with stakeholders and community groups and drafting bylaws as this Commission must adhere to the rules set out in the Federal Advisory Committee Act.

Problems of heirs to property

Estate of the heirs – land jointly owned by the descendants of those who left no legal will, thereby leaving them without clear title to the land – is the main cause of involuntary land loss among black landowners. Land transferred without a will is transferred to the surviving members of the family in the order of fractional ownership, that is, any heir can divide or sell the land.

In 2020, John Deere, the National Council of Black Farmers and the Thurgood Marshall College Foundation announced the formation of the LEAP (Systems of Law, Education, Protection and Production) Coalition. The coalition has launched a new website – Deere.com/LEAP – serve as a comprehensive resource explaining why LEAP is important to farmers.

The coalition is working with organizations such as the Federation of Southern Cooperatives and others to provide awareness, experience and legal resources to help blacks and other traditionally underrepresented farmers gain clear rights to their land. LEAP aims to ensure the long-term sustainability of over 60 million acres of land currently owned or cultivated by black farmers.

Tarlin Fox, John Deere employee and LEAP manager, notes: “If you combine this story with the leadership and expertise we have in agriculture, John Deere will be uniquely positioned to address issues such as heir ownership and further unlock economic potential. all farmers ”.

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