Biden announces $2 billion in USDA discrimination payments

The government has issued $2 billion in payments to more than 43,000 farmers who suffered discrimination when they applied for USDA farm loans in the past, said President Biden on Wednesday. More than half of the recipients were producers in Mississippi and Alabama, who received a combined $905.5 million.

Congress provided funding for the Discrimination Financial Assistance Program (DFAP) in 2022 after lawsuits stymied a debt-relief plan aimed at farmers of color. Some 889 farmers received the maximum DFAP payment of $500,000.

“Farmers and ranchers work around the clock to put food on our tables and steward our nation’s land. But for too long, many farmers and ranchers experienced discrimination in farm loan programs and have not had the same access to federal resources and support,” said Biden in a statement. He called the payments, open to farmers, ranchers, and forest landowners, “a bold step to address the effects of discrimination in farming and ranching.”

The USDA received more than 58,000 claims during a six-month application period that closed on Jan. 17. Each application was reviewed by two independent teams. Congress specified that the DFAP be run by third-party administrators. In the end, payments went to 23,000 farm and ranch operators, who received an average of nearly $82,000, and to 20,000 applicants who said they had planned a career in agriculture but were unable to get a USDA loan. They received an average of $5,000.

“My hope is that this will ensure that many farmers can stay on their farms, contribute to our nation’s food supply, and continue doing what they love,” said Agriculture Secretary Tom Vilsack.

The states with the largest payments were Mississippi, at $521.8 million, followed by Alabama ($383.7 million), Georgia ($137.3 million), North Carolina ($136.1 million), Arkansas ($106.8 million), and Oklahoma ($100.6 million). Mississippi had 13,283 recipients and Alabama had 10,907. No other state had more than 1,600. Some New England states had only a handful of recipients — two in Rhode Island, five in New Hampshire, six in Vermont, and eight in Maine. Payments went to every state, the District of Columbia, and three U.S. territories.

“We’ve taken a step in the right direction,” said Rep. Shontel Brown, an Ohio Democrat. “For centuries, Black and other ethnic minority farmers and ranchers endured discrimination, including from the USDA itself. Being denied even a small loan can mean a lifetime of lost earnings or even the loss of property.”

Vilsack said the USDA has awarded $2.4 billion in a separate program to assist farmers in financial distress and facing possible foreclosure on USDA loans and guaranteed loans. That program and the DFAP were created as part of the 2022 climate, healthcare, and tax law.

Over the past generation, the USDA has acknowledged in legal settlements with Black, Hispanic, Native American, and women farmers a history of bias in the operation of its farm loan programs.

The USDA webpage for the DFAP was available here.