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August 3, 2023 — The United States Department of Agriculture (USDA) has taken significant steps to address the long-standing issue of discrimination faced by farmers in its lending programs.
In August 2022, President Biden signed into law the Inflation Reduction Act (IRA), which authorized $2.2 billion in financial assistance for farmers, ranchers, and forest landowners who have experienced discrimination in USDA farm lending programs. The USDA aims to distribute these funds to eligible borrowers by the end of 2023.
Please note: The USDA has set a deadline for accepting applications until October 31, 2023 to begin your claim use our 100% Secure Intake Form to start your claim.
Background and Legal Framework
The USDA has been under scrutiny for decades due to discrimination complaints filed by minority farmers who were denied benefits under its farm assistance programs. In 1997, a group of African-American farmers filed a class-action lawsuit against the USDA, alleging racial discrimination in farm lending and benefit programs. The lawsuit resulted in a consent decree approved by a federal district court in April 1999, which established a framework for resolving individual claims.
Under the consent decree, various parties outside the federal government are responsible for deciding on individual claims based on information provided by the claimants and the USDA. As of January 2001, more than 25,000 people had filed claims, but some were rejected as ineligible class members, and others were found not to be entitled to a payment. Many of these individuals appealed these decisions to a court-appointed party, and additional individuals have submitted requests to file late claims.
The Inflation Reduction Act
The Inflation Reduction Act (IRA) signed into law by President Biden in August 2022 directed the USDA to provide financial assistance to farmers, ranchers, and forest landowners who have experienced discrimination in USDA’s farm lending programs. With an appropriation of $2.2 billion, the USDA is now implementing this program to address past injustices and promote equity in the agricultural sector.
The financial assistance provided under the IRA will be administered through qualified nongovernmental entities, as specified in the law. The USDA will soon issue contracts to nongovernmental program administrators, including a national administrator and four regional hubs, to coordinate the delivery of the financial assistance program efficiently. These vendors are encouraged to partner with organizations experienced in agriculture and working with underserved producers who have a relationship with the USDA.
Eligibility and Application Process
Farmers, ranchers, and forest landowners who have experienced discrimination by the USDA in its farm loan programs prior to January 1, 2021, are eligible to apply for financial relief. This includes individuals who have assigned or assumed USDA farm loan debt that was subjected to discrimination.
The eligibility criteria cover various forms of discrimination, such as race, age, sexual identity, gender, religion, disability, marital status, and retaliation for prior civil rights activity.
Begin the claims process today, the Schmidt National Law Group is actively seeking IRA claimants, but you MUST ACT before October 31, 2023. Call us direct at 1-800-631-5656, or use the form above, we can help answer any questions about your IRA eligibility.
Criteria to file a farming discrimination loan claim under the IRA
Any black farmers, ranchers, or forest landowners who have firsthand experience with ANY type of unfair treatment during the loans process (including long delayed loan processing) should be aware of the requirements of the IRA in order to file for claim compensation.
The specifics of certain qualifications are still being decided, this is what we currently know, the following criteria must be met:
- You are currently /or were a farmer, rancher, or forest landowner
- The discrimination must have taken place prior to January 1st, 2021
- There is clear evidence of racial discrimination, such as being denied a loan
- The discrimination directly inflicted monetary damages
- The discrimination happened in direct relation to the Direct FSA farm loan program, or the FSA discriminated against you when you were seeking a guaranteed farm loan
- You feel the discrimination happened based solely on your race.
Types of discrimination may include, but not limited to: Loan denials, unfair loan terms, changing of the loan terms, failure to inform a loan applicant of any changes made, deferred or delayed loans, or being asked for excessive collateral. All of these practices are illegal under the IRA Act.
Farm Loan Discrimination Attorneys Help Claimants.
To apply for financial assistance, eligible individuals can submit their applications online through the Schmidt National Law Groups intake form below:
The USDA has set a deadline for accepting applications until October 31, 2023 after which the applications will be reviewed in November and December. Payments will be made to eligible applicants soon after the review process is completed.
Payment Determination and Tax Considerations
The maximum payment for each eligible applicant is set at $500,000, as determined based on the consequences experienced from the discrimination. However, the actual payment amount may vary depending on the number of applications received and approved for payment. The USDA is committed to ensuring a fair and equitable distribution of funds to eligible farmers, ranchers, and forest landowners.
It is important to note that the financial assistance payments are not tax-exempt. However, the USDA is exploring options to address the tax implications of the payments and provide relief to the recipients, although no specific details have been announced at this time.
USDA’s Administrative Process for Discrimination Complaints
In addition to the financial relief program established under the IRA, the USDA has its own administrative process for resolving discrimination complaints. The Office of Civil Rights (OCR) within the USDA investigates allegations of discrimination, determines if there is evidence of discrimination, and negotiates settlements with complainants when discrimination is found. The Office of General Counsel reviews the cases where discrimination is substantiated to ensure the legal propriety of the finding and the proposed award. Finally, the Farm Service Agency (FSA) implements settlement agreements when discrimination is found in programs operated by the agency.
The resolution of discrimination complaints through USDA’s administrative process differs from the class-action settlement. In the administrative process, the USDA makes decisions on the discrimination complaints, whereas the class-action settlement involves external parties deciding on individual claims. Both processes aim to address and rectify discrimination experienced by farmers, ranchers, and forest landowners.
Conclusion
The USDA’s implementation of the Inflation Reduction Act and the establishment of a financial relief program is a significant step towards addressing discrimination in its farm lending programs. By providing financial assistance to eligible farmers, ranchers, and forest landowners who have experienced discrimination, the USDA aims to promote equity and justice in the agricultural sector. The application process is now open, and eligible individuals are encouraged to apply for the financial relief they deserve.
Begin your IRA Claim today by contacting the Schmidt National Law Group at 1-800-631-5656 or use the 100% Secure Intake Form above, you have until October 31, 2023 to file, ACT NOW.
For more information and updates on the progress of USDA’s equity initiatives, visit usda.gov/equity.
Note: The information provided in this article is based on multiple sources, including the U.S. Department of Agriculture and news articles. The article aims to provide a comprehensive overview of the USDA farmer discrimination lawsuit and the financial relief program. It is recommended to refer to official USDA resources for the most up-to-date and accurate information.
Updated on August 3, 2023.
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