Prop 12

Debt Forgiveness for Disadvantaged Farmers on Hold After Judge’s Ruling

Brian German Agri-Business, USDA-NRCS

The debt forgiveness assistance program for socially disadvantaged farmers is on hold for now after a recent ruling by a federal judge.  The U.S. Department of Agriculture (USDA) had been moving forward with a program to help approximately 14,000 minority farmers and ranchers across the country. Close to $4 billion in funding was approved for the program to pay off direct or guaranteed loans issued to producers. Judge William Griesbach of Wisconsin’s Eastern District has issued a temporary restraining order against the program, preventing payments from being issued.

Debt Forgiveness

The order comes after a lawsuit was filed back in April by the Wisconsin Institute for Law and Liberty (WILL). In the lawsuit, WILL claims that the debt relief program is unconstitutional. WILL is representing 12 farmers from Oregon, South Dakota, Minnesota, Kentucky, Iowa, Missouri, Wisconsin, and Arkansas. The lawsuit asserts that the relief program for minority farmers and ranchers is discriminatory in excluding white producers.  “Because plaintiffs are ineligible to even apply for the program solely due to their race, they have been denied the equal protection of the law and therefore suffered harm,” the lawsuit states.

The debt forgiveness program offers payments up to 120 percent of direct and guaranteed loan balances for socially disadvantaged borrowers. USDA has expressed disappointment in the ruling and has indicated it plans to defend the debt relief program. In a statement, USDA said it will be going over the lawsuit with the U.S. Department of Justice. Loan payments were initially expected to be sent between June and December this year. However, with the recent ruling, USDA has halted payments.

Other similar lawsuits against the debt forgiveness program have also be filed in several states. A discrimination lawsuit has been filed in the U.S. District Court for the District of Wyoming. Another suit in the Western District of Tennessee has also been filed.

About the Author

Brian German

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Ag News Director, AgNet West