A Hearing to Review the State of Black Farmers in the U.S. (March 25, 2021)
Summary
Transcript of "A Hearing to Review the State of Black Farmers in the U.S." before the Committee on Agriculture, March 25, 2021, Serial No. 117-3, with Chairman David Scott presiding; Mr. Scott called it a historic hearing. Witnesses included Secretary of Agriculture Thomas J. Vilsack, John W. Boyd, Jr. of the National Black Farmers Association, Cornelius Blanding of the Federation of Southern Cooperatives/Land Assistance Fund, Philip J. Haynie III of the National Black Growers Council and Sedrick Rowe of Rowe Organic Farms LLC. Glenn Thompson also gave an opening statement. The record includes letters from Deere & Company and Bayer Crop Science and closes with a submission calling for farmer-owned processing facilities, refrigerated trucks and aggregation centers with long-term USDA commitment.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“A Hearing to Review the State of Black Farmers in the U.S. (March 25, 2021).”
Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/house-hearing-117th-congress-a-hearing-to-review-the-state-of-black-fa-45520685fd/
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[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
A HEARING TO REVIEW THE STATE OF BLACK
FARMERS IN THE U.S.
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
----------
MARCH 25, 2021
----------
Serial No. 117-3
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Agriculture
agriculture.house.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
46-332 PDF WASHINGTON : 2021
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COMMITTEE ON AGRICULTURE
DAVID SCOTT, Georgia, Chairman
JIM COSTA, California GLENN THOMPSON, Pennsylvania,
JAMES P. McGOVERN, Massachusetts Ranking Minority Member
FILEMON VELA, Texas AUSTIN SCOTT, Georgia
ALMA S. ADAMS, North Carolina, Vice ERIC A. ``RICK'' CRAWFORD,
Chair Arkansas
ABIGAIL DAVIS SPANBERGER, Virginia SCOTT DesJARLAIS, Tennessee
JAHANA HAYES, Connecticut VICKY HARTZLER, Missouri
ANTONIO DELGADO, New York DOUG LaMALFA, California
BOBBY L. RUSH, Illinois RODNEY DAVIS, Illinois
CHELLIE PINGREE, Maine RICK W. ALLEN, Georgia
GREGORIO KILILI CAMACHO SABLAN, DAVID ROUZER, North Carolina
Northern Mariana Islands TRENT KELLY, Mississippi
ANN M. KUSTER, New Hampshire DON BACON, Nebraska
CHERI BUSTOS, Illinois DUSTY JOHNSON, South Dakota
SEAN PATRICK MALONEY, New York JAMES R. BAIRD, Indiana
STACEY E. PLASKETT, Virgin Islands JIM HAGEDORN, Minnesota
TOM O'HALLERAN, Arizona CHRIS JACOBS, New York
SALUD O. CARBAJAL, California TROY BALDERSON, Ohio
RO KHANNA, California MICHAEL CLOUD, Texas
AL LAWSON, Jr., Florida TRACEY MANN, Kansas
J. LUIS CORREA, California RANDY FEENSTRA, Iowa
ANGIE CRAIG, Minnesota MARY E. MILLER, Illinois
JOSH HARDER, California BARRY MOORE, Alabama
CYNTHIA AXNE, Iowa KAT CAMMACK, Florida
KIM SCHRIER, Washington MICHELLE FISCHBACH, Minnesota
JIMMY PANETTA, California ------
ANN KIRKPATRICK, Arizona
SANFORD D. BISHOP, Jr., Georgia
______
Anne Simmons, Staff Director
Parish Braden, Minority Staff Director
(ii)
C O N T E N T S
----------
Page
Adams, Hon. Alma S., a Representative in Congress from North
Carolina, submitted memorandum................................. 324
Carbajal, Hon. Salud O., a Representative in Congress from
California, submitted case..................................... 350
Costa, Hon. Jim, a Representative in Congress from California,
prepared statement............................................. 7
Submitted article............................................ 302
Submitted hearing............................................ 305
Submitted report............................................. 318
Submitted statements on behalf of:
Scott, Jr., Will, Owner, Scott Family Farms, Founder,
African American Farmers of California................. 322
Asian Business Institute & Resource Center............... 323
Kirkpatrick, Hon. Ann, a Representative in Congress from Arizona,
submitted report............................................... 375
Rush, Hon. Bobby L., a Representative in Congress from Illinois,
submitted book................................................. 348
Scott, Hon. David, a Representative in Congress from Georgia,
opening statement.............................................. 1
Prepared statement........................................... 4
Submitted letters on behalf of:
Bunch, James, President/Chief Executive Officer,
Bunchology LLC......................................... 159
Davis, Webster E., Senior Policy Advisor, Family Farm
Action................................................. 160
Jones, Collis, Vice President, U.S. Policy & Strategy,
Deere & Company........................................ 163
Simpson, Duane, Vice President, North America Government
& Industry Affairs, Bayer Crop Science................. 164
Submitted presentation on behalf of Bernice Atchison, farmer
from Chilton County, AL and Pigford historian.............. 166
Submitted statements on behalf of:
Khanna, Navina, Executive Director, HEAL (Health,
Environment, Agriculture, Labor) Food Alliance......... 204
Jordan, Tanya Ward, President, Coalition For Change, Inc.
(C4C).................................................. 207
Rural Coalition/Coalicion Rural.......................... 208
Thompson, Hon. Glenn, a Representative in Congress from
Pennsylvania, opening statement................................ 5
Witnesses
Vilsack, Hon. Thomas ``Tom'' J., Secretary, U.S. Department of
Agriculture, Washington, D.C................................... 10
Prepared statement........................................... 11
Submitted questions.......................................... 394
Boyd, Jr., John W., Founder and President, National Black Farmers
Association, Baskerville, VA................................... 13
Prepared statement........................................... 15
Submitted questions.......................................... 402
Blanding, Cornelius, Executive Director, Federation of Southern
Cooperatives/Land Assistance Fund, East Point, GA.............. 93
Prepared statement........................................... 95
Haynie III, Philip J., Chairman, National Black Growers Council,
Burgess, VA.................................................... 98
Prepared statement........................................... 99
Rowe, Sedrick, Owner/Operator, Rowe Organic Farms LLC, Albany, GA 101
Prepared statement........................................... 102
Submitted questions.......................................... 403
Sherrod, Shirley, Executive Director, Southwest Georgia Project
for Community Education, Inc., Albany, GA...................... 103
Prepared statement........................................... 105
Submitted question........................................... 403
Cotton, Arnetta, Co-Owner and Program Facilitator, Kingdom
Community Development Services, Wagoner, OK; accompanied by
Earrak Cotton, Owner, Cattle For The Kingdom................... 106
Prepared statement........................................... 108
A HEARING TO REVIEW THE STATE OF BLACK FARMERS IN THE U.S.
----------
THURSDAY, MARCH 25, 2021
House of Representatives,
Committee on Agriculture,
Washington, D.C.
The Committee met, pursuant to call, at 12:00 p.m., via
Webex, Hon. David Scott of Georgia [Chairman of the Committee]
presiding.
Members present: Representatives David Scott of Georgia,
Costa, McGovern, Adams, Spanberger, Hayes, Delgado, Rush,
Pingree, Sablan, Kuster, Bustos, Maloney, Plaskett, O'Halleran,
Carbajal, Khanna, Lawson, Correa, Craig, Harder, Axne, Schrier,
Panetta, Kirkpatrick, Bishop, Thompson, Austin Scott of
Georgia, DesJarlais, Hartzler, LaMalfa, Davis, Allen, Rouzer,
Bacon, Johnson, Baird, Hagedorn, Balderson, Cloud, Mann,
Feenstra, Miller, Moore, and Fischbach.
Staff present: Lyron Blum-Evitts, Carlton Bridgeforth, Ross
Hettervig, Chu-Yuan Hwang, Anne Simmons, Ashley Smith, Parish
Braden, Caleb Crosswhite, Josh Maxwell, Jennifer Tiller, Erin
Wilson, John Konya, and Dana Sandman.
OPENING STATEMENT OF HON. DAVID SCOTT, A REPRESENTATIVE IN
CONGRESS FROM GEORGIA
The Chairman. This hearing of the Committee on Agriculture
entitled, A Hearing to Review the State of Black Farmers in the
U.S., will now come to order.
Welcome, and I want to thank everyone for joining us for
today's hearing. After brief opening remarks, Members will
receive testimony from the witnesses today, and then the
hearing will be open to our Members' questions. Members will be
recognized in the order of seniority, alternating between
Majority and Minority Members, and in the order of arrival for
those Members who have joined us after the hearing was called
to order. When you are recognized, you will be asked to please
unmute your microphone, and you will have 5 minutes to ask your
questions and make your statements. If you are not speaking,
please, I ask that you remain muted in order to minimize the
background noise so we can hear what our witnesses and our
Members are saying. In order to get to all of your questions,
the timer will stay consistently visible on your screen, and
your Chairman is going to be very strict. Five minutes, the
hammer is coming down. We want everybody to participate in this
extraordinary event.
And ladies and gentlemen, my opening statement.
This is a historic hearing, and I want to begin this
hearing with these words. We all know that all things work
together for good. To them, who love God, and to them, who are
called according to God's purpose, there could be no more
glorious words to use to set off this historic hearing that we
are having today. And we all are very pleased to have the
opportunity today to examine this topic which is deeply
embedded in each of our hearts, both Democrats and Republicans
hear about the plight of our Black farmers. And when our minds
and our hearts are together, we are truly doing God's will.
And so, as always, I certainly appreciate the opportunity
to work on this issue alongside my colleague, the Republican
Ranking Member of this Committee and my friend, Congressman
Thompson of Pennsylvania. And I want to thank our Secretary of
Agriculture, Tom Vilsack, for appearing before our Committee
today. And this is our first Committee conversation with your
second tenure at the USDA, Mr. Secretary, and we are so
delighted and glad that you are before us today. I want you to
know, from the bottom of my heart, I thank you for joining us
today.
I have heard that you are extremely busy, and I want to
just doubly appreciate your time that you are taking to speak
with us on this important and historic issue, an issue that I
know that you have been working on. I thank you for the work
that we have done together in putting forward a helping hand in
the rescue package to bring $4 million to help our farmers pay
their loans, and the $1 million that will help provide
technical support. We appreciate your working with us on that.
For decades, the discrimination against Black farmers by
the United States Department of Agriculture has been well-
documented. Reports by the United States Commission on Civil
Rights, the Government Accountability Office, and even the
United States Department of Agriculture itself describes the
discriminatory practices that were enabled by laws dating back
all the way to the 1930s. That is why I am saying this is
historic and hallowed ground that we are working on this day.
In fact, in 1997, a group of Black farmers, including Mr.
Timothy Pigford, filed a class action lawsuit against the
United States Department of Agriculture over the agency's
discrimination against Black farmers in farm loan programs and
other benefit programs, as well as over the agency's failure to
investigate racial discrimination complaints. The evidence is
in. It is before us today, and this is why this is so
meaningful for us, and why I prefaced it with that message from
the Lord that He has given to us this day to serve His purpose
that He has brought us together today, and that is to bring
justice to our Black farmers.
Well, the United States Department of Agriculture settled
this class action lawsuit, and as a part of that settlement,
some Black farmers--just some--received $50,000. Now many of my
House colleagues may think that $50,000 is indeed a lot of
money, but when a new tractor costs as much as $\1/2\ million,
$50,000 is barely enough for a down payment on a reasonably
good used tractor.
It isn't enough to make improvements to the land. It may
not even be enough to finance next year's purchases of seed and
fertilizer. And in my frank opinion, $50,000 is not enough to
make up for the decades of discrimination and generational
wealth that has been lost among Black farming families, losing
the land and the livelihood of our Black families. Black farms
are, by and large, Black family farms.
And further, adding insult to injury, Black farmers were
saddled with IRS tax bills from that Pigford settlement,
leaving many of them worse off than before they even got the
$50,000. And that is why what we did together in the bill we
just passed--when people say what is this in here talking about
paying the tax bill, it is because we learned the Pigford bill.
So, there is money here that takes into consideration of the 20
percent over what we are getting so that those taxes are paid
for, because the IRS uses that money as income, and they tax
that loan forgiveness. I want to thank Secretary Vilsack for
helping us put that package together.
In short, the Pigford settlement was too little, it was too
late for our Black farmers who lost their farms and livelihoods
due to longstanding, systemic discrimination. And this systemic
discrimination continues to be felt by Black farmers right
today, who are still disadvantaged in our United States
Department of Agriculture programs.
This festering wound on the soul of American agriculture
must be healed. This isn't just a festering wound in the Black
farming area. It is a festering wound on all of agriculture,
because we have to excise and heal this wound so that once and
for all, my fellow Members, we will be able to make the
statement that we no longer have racial discrimination in our
United States Department of Agriculture, and that we want our
glorious and wonderful world of agriculture to be open, to have
opportunities for everybody regardless of race, creed, or
color.
That is why I have repeatedly called for a new conversation
between Black farmers and the United States Department of
Agriculture. This hearing is an opportunity for us, together
with Secretary Vilsack here joining us, to begin that
conversation, examine the Secretary of Agriculture's ideas and
reforms that I understand he is already working on. And we have
this opportunity to hear firsthand from our Secretary, and I
thank God for that.
This hearing, today, is very public, and it is a public way
to address the deep mistrust that many of our farmers of color
feel towards the United States Department of Agriculture. We
are not hiding anything here, because when you hide it, you
can't solve it. This is why this hearing is historic. And to
make sure that in an increasingly competitive agriculture
economy, no talent or ability is ignored or left behind. We no
longer can afford that approach.
The Black farmer representatives who are with us today,
they will discuss this longstanding, systemic discrimination
against our Black farmers. Who better to do that than our Black
farmers themselves? And that is why I am so glad that they are
here along with Secretary Vilsack.
In 1920, Black farm operators were 14 percent of all the
United States farmers, and in the South, over 20 percent of all
the farms were owned by African Americans. You know what it is
now? It is less than two percent, 1.8 percent to be exact.
Lack of equal access to our Federal farm loan programs is a
large reason Black farms have lost 90 percent of their land. In
1937, Congress required that locally elected county
commissioners and committees certify the eligibility of farmers
for the farm loan program. And when a farmer applied for a farm
program, the county committees received sensitive information
about the applicants. This left creditworthiness up to the
elected officials, county officials on the committee, many of
whom were landlords on this land. Talk about a conflict of
interest in addition to the racism. So, there was built-in bias
against our Black farmers for decades. And I am not speaking to
you as one that doesn't know. You are looking at your Chairman
who was born on a Black farm, my grandparents' farm, in Aynor,
South Carolina. And you talk about farming, that was the heart
of it in Aynor. I know what it was there.
For those of you who feel the number of loans is fairly
representative of the number of Black farmers today, I say they
totally miss the point. Most farmers who can't get a loan are
simply not farming. But we are here to find out why they aren't
farming, to examine the built-in barriers to the loan system
and to see how to remove them.
We have six farmers and farmer advocates here on the panel
with us today who will share their experience and solutions to
address the effects of discrimination and improve the
profitability and sustainability of our Black farmers. That is
the bottom line. We have to increase the market share of our
Black farmers. If we do that and our Black farmers are making
money, we will never have to be in the position of having to
pay lending bills if they get the proper amount of market share
to sell their products on the market.
Folks, I am noticing our good work here in Congress as
well, and I have a letter of support for policies, including
the American Rescue Plan of 2021 for relief for farmers of
color. If there is no objection, I will enter this letter of
support from a major agricultural industry giant, Bayer, for
the record.
[The letter referred to is located on p. 164.]
[The prepared statement of Mr. David Scott follows:]
Prepared Statement of Hon. David Scott, a Representative in Congress
from Georgia
Good afternoon, I'm pleased to have the opportunity today to
examine a topic which is deeply embedded in my heart--the status of
Black farmers in the United States. And as always, I appreciate the
opportunity to work on this matter alongside my colleague, Ranking
Member Thompson of Pennsylvania.
I want to thank our newly appointed Secretary of Agriculture Tom
Vilsack for appearing before the Committee today. This is our first
conversation of your second tenure at USDA, Mr. Secretary, and we are
glad you are before us today.
I know that you are extremely busy, and I appreciate your time
today to speak on this essential issue. An issue that I know you too
have wrestled with.
For decades the discrimination against Black farmers by USDA has
been well-documented. Reports by the U.S. Commission on Civil Rights,
the Government Accountability Office, and even the USDA itself describe
the discriminatory practices enabled by laws dating back to the 1930s.
In fact, in 1997, a group of Black farmers, including Mr. Timothy
Pigford, filed a class action lawsuit against USDA over the agency's
discrimination against Black farmers in farm loan programs and other
benefit programs, as well as over the agency's failure to investigate
race discrimination complaints.
USDA settled this class action lawsuit, and as a part of that
settlement, some Black farmers received $50,000. Now many of my House
colleagues may think that $50,000 is a lot of money, but when a new
tractor costs as much as $\1/2\ million, $50,000 is barely enough to
buy even a reasonably good used one.
It isn't enough to make improvements to the land. It may not even
be enough to finance next year's purchases of seed and fertilizer. And
in my frank opinion, $50,000 is not enough to make up for decades of
discrimination and generational wealth lost from the losing of land and
livelihood among Black farmers.
Further, adding insult to injury, Black farmers were saddled with
IRS tax bills from the Pigford settlements, leaving many of them worse
off than before.
In short, the Pigford settlements were too little, too late for the
Black farmers who lost their farms and livelihoods due to longstanding,
systemic discrimination. And this systemic discrimination continues to
be felt by Black farmers today, who are still disadvantaged in USDA
programs.
This festering wound on the soul of American agriculture must be
healed. That is why I have repeatedly called for a new conversation
between Black farmers and USDA. This hearing is an opportunity for us,
together, with Secretary Vilsack, to begin that conversation and
examine the Secretary's ideas and reforms that I understand are being
contemplated at USDA.
This hearing today is a very public way to address the deep
mistrust that many farmers of color feel towards USDA, and to make sure
that in an increasingly competitive agriculture economy no talent or
ability is ignored or left behind. We no longer can afford that
approach.
The Black farmer representatives who are here with us today will
discuss the longstanding, systemic discrimination against Black farmers
and its cumulative impact on Black farming in the United States. In
1920 Black farm operators were 14 percent of all U.S. farmers.
Today, Black farmers make up less than two percent of all farmers
in the United States. Lack of equal access to Federal farm loan
programs is a large reason Black farmers have lost 90% of their land.
In 1937, Congress required that locally elected county committees
certify the eligibility of farmers for the farm loan program.
When a farmer applied for a farm program, the county committees
received sensitive information about the applicant; this left credit-
worthiness up to an elected county committee, many of whom were
landlords. So, there was a built-in bias against Black farmers for
decades. And subsequent laws and their regulations are built on that
same foundation of inequity.
For those who feel that the number of loans is fairly
representative of the number of Black farmers today, I say they totally
miss the point. Most farmers who can't get a loan are simply not
farming.
But, we are here to find out why they aren't farming, to examine
the built in barriers to the loan system and see how to remove them.
We have six farmers and farmer advocates here with us today who
will share their experience and solutions to address the effects of
discrimination and improve the profitability and sustainability of
Black farmers.
Folks are noticing our good work in Congress as well. I have here a
letter of support for policies included in the American Rescue Plan for
relief for Farmers of Color. If there is no objection, I will enter
this letter of support from Bayer into the record . . . thank you.*
---------------------------------------------------------------------------
* The letter referred to is located on p. 164.
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I'd now like to welcome the distinguished Ranking Member, the
gentleman from Pennsylvania, Mr. Thompson, for any opening remarks he
would like to give.
The Chairman. Thank you. I would now like to welcome the
distinguished Ranking Member, my friend, the gentleman from
Pennsylvania, Mr. Thompson, for his opening remarks. Thank you.
OPENING STATEMENT OF HON. GLENN THOMPSON, A REPRESENTATIVE IN
CONGRESS FROM PENNSYLVANIA
Mr. Thompson. Well, good afternoon, and thank you, Mr.
Chairman. Always a privilege and honor to work with you on the
issues that are so important to rural America, and to our
agriculture industry. And thank you for holding today's hearing
on such an important issue that I know is not only near and
dear to your heart, but it is an issue of such importance that
each and every one of us participating today, including those
tuning in to our livestream, can learn something from.
Today's hearing to review the state of Black farmers in the
United States is an opportunity to address some questions that,
quite frankly, have gone unanswered for far too long. Everyone
participating today is familiar with the 1999 class action
suit, Pigford v. Glickman, a case that alleged decades of
discrimination by the United States Department of Agriculture
against Black farmers applying for farm loans and other
government assistance. Since the original Pigford settlement,
more than $2 billion have been allocated as compensation for
Black farmers.
Without a doubt, there has been discrimination at USDA in
the past against Black farmers and other socially disadvantaged
groups. Sadly, I am sure, instances of discrimination remain
today.
Now, Pub. L. 117-2, the American Rescue Plan of 2021 was
signed into law 2 weeks ago today. Among the nearly $2 trillion
in spending was $5 billion allocated for Black farmers, $4
billion of which was designated for loan forgiveness. Now, let
me be clear. I didn't vote for this bill for many obvious
reasons. The fact that the bulk of the multi-trillion-dollar
bill had virtually nothing to do with COVID was chief among
them. It was also drafted behind closed doors with no input
from the Minority party. We never get the best product whenever
either party allows that to happen. And moreover, the bill was
drafted based on hypotheticals, misinformation, and incomplete
data. Unfortunately, that is what happens when you force
through partisan legislation through budget reconciliation.
Paying off the loans of socially disadvantaged farmers may help
in the short-term, but it does very little to address the root
cause of this issue. I know my healthcare practice for 28
years, we had to get to the root cause of an issue to truly
address it long-term. I think that applies just as important
lessons apply to legislation or dealing with public policy
issues especially as egregious ones as discrimination within
agriculture programs and the support of those. It does nothing
to attack discrimination head on, and it certainly doesn't
prevent racial exclusion for Black farmers, or any other
socially disadvantaged group in the future.
Now, how did USDA leadership fail so spectacularly to allow
this ongoing discrimination for so many years? Why were bad
actors allowed to continue their comfortable government or
appointed jobs when they so brazenly allowed discrimination to
continue, even if not having directly engaged in discrimination
itself? Where was the oversight? Where was the supervision of
these bad actors? Is simply forgiving debt the best way to
address this problem and provide a forward thinking and
equitable outcome?
The American Rescue Plan of 2021 gives USDA blanket
authority to handle the funds provided through the legislation.
Well, surely leaving an unelected bureaucracy with a decades
long track record of racial discrimination to their own devices
cannot be the best way to right wrongs. We cannot forget the
progress Congress has already made by authorizing program
initiatives through previous farm bills that I am very proud of
to assist our Black and other socially disadvantaged farmers.
From credit to conservation, there have been a number of
provisions that seek to address inequalities.
For example, USDA's Farm Service Agency now targets direct
loans and guaranteed loans to eligible socially disadvantaged
farmers to buy and to operate family-sized farms and ranches.
When it comes to conservation and forestry, the Natural
Resources Conservation Service has made a concerted effort to
provide resources for socially disadvantaged and historically
underserved producers. Every year, NRCS targets five percent of
its EQIP investments, that program, for socially disadvantaged
farmers. However, over the last decade, NRCS has exceeded
expectations with 33 percent of EQIP funding going to
historically underserved producers and beginning farmers.
Of course, I would be remiss not to mention the 2018 Farm
Bill, and Mr. Chairman, recognize your efforts when it came to
doing better and providing the investments in our historically
Black 1890 land-grant universities. Thank you for your
leadership on that initiative as a part of that farm bill
process, including the $80 million in scholarships for those
HBCU students to pursue agricultural education.
While much work remains, we should look to this previous
progress as really a blueprint in our continued discussions. We
must work together as a farm team: farmers, ranchers,
producers, legislators, stakeholders, and activists alike to
reduce barriers that are preventing Black and other socially
disadvantaged farmers from participating fully in a robust farm
economy. We must support a strong farm economy that lifts up
all.
I would like to thank our Chairman once again. I would
especially like to thank our witnesses. We have an impressive
list of witnesses here. Having read and digested your written
testimony, it was certainly heartfelt. There was a lot of
passion, emotion, sharing your life stories throughout that,
and that is appreciated, much appreciated. Your testimony is
critical in helping us better understand the discrimination
Black farmers have faced, and also, it will play a crucial role
to ensure our agriculture policy does not discriminate. Rather,
it empowers farms of all races, sizes, and commodities.
I am here to listen. We are all here to listen, and I look
forward to participating in this long overdue conversation.
Thank you, Chairman, and I yield back.
The Chairman. Thank you, Ranking Member, for those
excellent comments and words.
The chair would request that other Members submit their
opening statements for the record so witnesses may begin their
testimony and to ensure that there is ample time for all of
your questions.
[The prepared statement of Mr. Costa follows:]
Prepared Statement of Hon. Jim Costa, a Representative in Congress from
California
Today's hearing is truly a historic one. I want to thank the
Chairman and Ranking Member for providing this opportunity to review
the state of Black farmers in our country. In California we've seen a
dramatic decrease in the number of Black farmers and unfortunately,
socially disadvantaged farmers still face many barriers. In preparation
for this hearing I requested testimony from Will Scott, Jr. founder and
President of the African American Farmers of California which I will
enter in full to the hearing record.
The additional testimony we'll hear today makes it clear that there
has been discrimination towards Black farmers by the USDA. I want to
point out that there has also been a history of discrimination against
other farmers of color, such as Asian American farmers, in my state.
We're all aware of America's shameful internment of Japanese
Americans during World War II. Many of the Japanese Americans forced
into internment camps were Pacific Coast farmers, who left behind land
they had successfully cultivated for decades. The USDA's Farm Security
Agency was tasked with confiscating the land and ensuring that
agricultural production was uninterrupted by the forced removal of
these Japanese American farmers. Approximately 6,000 Japanese American
farms were confiscated, totaling 200,000 acres, during this period.
Additionally, I have many Hmong farmers in my district, who have
also faced discriminatory barriers. In 1997, some representatives for
Hmong farmers testified before our Committee that they were unable to
secure financing through USDA due to discrimination. Local USDA offices
and banks were unwilling to provide any assistance to Hmong farmers in
submitting farm loan or disaster program applications.
And when Hmong farmers later did gain access to USDA farm loan
programs, many of them were taken advantage of by predatory lenders. In
2001, hundreds of Hmong farmers in Arkansas, Oklahoma, and Missouri
used FSA guaranteed loans to purchase poultry farms, whose values were
inflated by lenders. Hmong farmers were strapped with large mortgages
they could not repay. And when these farms failed, the Federal
Government stepped in to pay off up to 95 percent of each loan.
I will submit for the record the hearing testimony of Mr. Pheng Vue
and Charlie Jonchue Chang before the Committee in 1997, as well as a
2006 article from the Chicago Tribune about Hmong poultry farmers
losing their farm after taking out FSA guaranteed loans. Additionally,
I will submit testimony prepared for this hearing by Blong Xiong,
Executive Director of the Fresno Asian Business Institute and Resource
Center, further detailing the experiences of Hmong and Southeast Asian
farmers during the COVID-19 pandemic.*
---------------------------------------------------------------------------
* The documents referred to are located on p. 302.
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Thank you for holding this hearing on such an important topic. I
look forward to working with Secretary Vilsack and the Committee to
continue to advance the cause of the socially disadvantaged farmers
across the country.
The Chairman. So, without objection, the chair is
authorized at any time to declare the Committee in recess,
subject to the call of the chair.
And now, let us turn our attention to our distinguished
panelists who are here with us today, and we are so delighted.
First, I am very pleased to welcome back to the Agriculture
Committee Secretary Tom Vilsack, who is now leading our
Department of Agriculture for the second time. Secretary
Vilsack needs no introduction to many of us on this Committee,
but I will note that he did serve two terms also as the
Governor of Iowa before joining the Obama Administration as the
30th Secretary of Agriculture in 2009. He was President Obama's
longest serving cabinet Secretary. He was confirmed again in
February of this year for his second tenure as Secretary.
Our next witness is Mr. John Boyd, Jr., founder and
President of the National Black Farmers Association. Mr. Boyd
is a fourth-generation farmer from Baskerville, Virginia, where
he owns and operates a 300 acre farm, raising corn, wheat,
soybeans, and beef cattle. Mr. Boyd is a familiar presence here
in Washington, D.C., as the founder and President of the
National Black Farmers Association. Since 1995, the National
Black Farmers Association has fought hard for equal treatment
for our Black farmers at USDA's Farm Service Agency,
particularly with equal access to credit. Also, Mr. Boyd was a
key spokesperson for Black farmers during both Pigford 1 and
Pigford 2. And Mr. Boyd continues to promote inclusion,
equality of opportunity for Black farmers across all sectors of
our agriculture industry across the nation. It is good to have
you here today, Mr. Boyd, and we appreciate your testimony as
well.
And now, I am pleased to welcome our third witness, Mr.
Cornelius Blanding, Executive Director of the Federation of
Southern Cooperatives. Mr. Blanding joins us today with a deep
background in management consulting and business development,
including 24 years in support of Black farmers and rural
landowners. He has served on more boards and committees than we
have time to name here today. Of note, though, are USDA's
Advisory Committee on Beginning Farmers and Ranchers, as well
as a member of the Advisory Board of the Socially Disadvantaged
Farmers and Ranchers Policy Research Center. We are very
grateful for your time, your experience, and your commitment to
Black farmers, and thank you also for joining us today.
Our fourth witness is Mr. Philip J. Haynie III. He is
Chairman of the National Black Growers Council. Mr. Haynie is a
fifth-generation farmer based in Reedville, Virginia, where he
and his family have a grain farm, a timber harvesting
operation, a bulk transport business, in addition to a
landscaping and excavating company. He is a graduate of
Virginia Tech. Mr. Haynie is currently the Chairman of the
National Black Growers Council. Welcome, Mr. Haynie. You are
clearly a very busy man. Mr. Haynie, we appreciate your
participation in being here today and look forward to your
excellent testimony.
Next, I would like to welcome Mr. Sedrick Rowe. Mr. Rowe is
an organic farmer from Rowe Organic Farms. Mr. Rowe is from
Albany, Georgia, where he operates a USDA-certified organic
farm, producing peanuts, hemp, watermelons, and canalfa--
canola, excuse me. His commitment to agriculture extends from
creation of the first Georgia Organic Peanut Association. His
pursuit of a Ph.D. in soil health--that is going to come in
very handy as we grapple with our climate change, no-till
farming, and cover crops. And his commitment to rural Georgia
is evident by his work with young farmers in his community, and
as a recognized leader of young farmers. He is an example of
hard work and brains, and I hear he knows how to play football,
too. Thank you for being with us, Mr. Rowe.
Our fifth witness is Mrs. Shirley Sherrod, an extraordinary
individual and a legendary leader in the fight to help her
Black farmers. Mrs. Shirley Sherrod is Executive Director of
the Southwest Georgia Project for Community Education,
Incorporated. Mrs. Sherrod is a distinguished fellow Georgian
who has served in multiple positions promoting rural
communities and agriculture. Mrs. Sherrod is a graduate of
Albany State in Albany, Georgia, and Mrs. Sherrod was the first
person of color to be appointed as Georgia's state director of
the United States Department of Agriculture's Rural Development
in 2009. I am really looking forward as we move to really
address rural development and rural broadband. Mrs. Sherrod
brings years of cumulative expertise to today's panel of
witnesses as the founder and Vice President of Development for
New Communities, Inc., the nation's first community land trust,
the Executive Director of Southwest Georgia's Project for
Community Education, Inc., as well as the state lead for
Southern Rural Black Women's Initiatives for Economic and
Social Justice. Thank you so very much for sharing your wealth
of experience and knowledge with us today, Mrs. Sherrod.
And to introduce our final witness, I am pleased now to
yield to our colleague on the Agriculture Committee, the
distinguished gentleman from Kansas, Mr. Mann.
Mr. Mann. Thank you, Chairman Scott. Thank you for this
hearing. I am honored to introduce to you Arnetta and Earrak
Cotton, the owners of Kingdom Community Development Services
and Cattle For The Kingdom in Wagoner, Oklahoma. The Cottons
have more than 54 years of farm and ranch experience, and have
dedicated their lives to outreach and assistance for rural and
underserved communities. I am especially grateful for the
Cottons and their recent work to distribute USDA Farmers to
Families food boxes in Kansas, among other states, and through
the Rural Impact Food Pantry at the church that they lead. I
very much enjoyed getting to know the Cottons. They are
wonderful people. They are the perfect example of serving,
educating, and finding ways to farm and ranch despite
adversity. Mr. and Mrs. Cotton, we look forward to hearing your
testimony in a few minutes.
The Chairman. I thank the gentleman for his remarks and for
his introduction.
Now, we will now proceed to our historic hearing, and with
our testimony, and each of our panelists will have 5 minutes.
Now, I am going to be strict on the timer so that we can get
everybody in and heard. And so, the timer will be visible to
everyone on your monitors so that you will have a countdown to
zero, at which point, your time will be expired and I will
bring down the gavel.
So, now let us start with our distinguished Chairman of the
agriculture--the United States Agriculture Department. Mr.
Vilsack, our distinguished Secretary, you are now recognized
for 5 minutes. Please begin now.
STATEMENT OF HON. THOMAS ``TOM'' J. VILSACK, SECRETARY, U.S.
DEPARTMENT OF AGRICULTURE, WASHINGTON, D.C.
Secretary Vilsack. Mr. Chairman, thank you very much to you
and to Ranking Member Thompson for calling this historic
hearing on the state of Black farmers in America and
discrimination directed at Black farmers by the Department of
Agriculture.
In the interest of time and my belief that the testimony of
the other panelists on this panel is far more relevant and more
compelling than anything I would offer, I won't read my
prepared statement but would ask that it simply be placed in
the record.
What I wish to do today is to speak from the heart, and I
want to provide you, Mr. Chairman, and Members of this
Committee a single and solemn commitment from me and from the
team at USDA that we will, over the next 4 years, do everything
we can to root out whatever systemic racism and barriers that
may exist at the Department of Agriculture directed at Black
farmers, socially disadvantaged farmers, and people who live in
persistently poor areas in rural America.
Efforts have already been made in the past as you have
indicated, Mr. Chairman, good faith efforts to respond to
specific acts of discrimination, but more needs to be done to
dig deeper into the systemic causes and barriers that
perpetuate discriminatory practices, and to deal directly with
the cumulative effect of discrimination, the gap that now
exists between those who had the full array of services at
USDA, the full array of programs at USDA, and those who, for
far too long, have not had that array.
Work has begun already to start the implementation of
President Biden's Executive Order on equity. A working group
has been formed at USDA across all agencies, and they have
already begun to meet and to begin the work of the assessment
of services, benefits, contracts, and procurements, and
barriers and problems that may exist. I will have the benefit
of the guidance and direction for the first time ever of a
senior advisor for equity in the Secretary's office. Dr.
Dewayne Goldmon has been appointed in that position, and he
will work with our new team at the Civil Rights Office, and
with the dedicated men and women at USDA to provide advice and
direction on equity issues throughout the USDA. I certainly
look forward to the day of Senate confirmation of Dr. Jewel
Bronaugh, who once confirmed, will be the first African
American Deputy Secretary at the United States Department of
Agriculture. She and I will partner together to carry out and
fulfill the commitment that I made to you today.
Finally, I am grateful for your leadership, Mr. Chairman,
and that of Chairman Bishop, Senators Booker, Warnock, and
Warren, who helped to shepherd through the American Rescue Plan
of 2021 that contains an historic step forward in responding to
the cumulative effect of discrimination in the past by
providing debt relief for socially disadvantaged producers, by
establishing an Equity Commission to review barriers that exist
at USDA, to assist with heirs property issues, expanded
outreach, market development, and land access. These resources
will help restore some balance in the USDA COVID Covenant
Relief Approach, and allow an external review of all of our
programs at USDA.
We are prepared to move quickly, efficiently, and
thoughtfully to implement the American Rescue Plan of 2021
sections related to Black farmers and socially disadvantaged
farmers, and other sections of the Rescue Plan that relate to
rural America.
As part of my commitment to you today, I also want to
provide an additional guarantee, and that is I plan to have in
place a system of rigorous reporting, accountability, and
oversight in all of our equity efforts.
Let me be clear. There is no place at the USDA for
discrimination, none. Nor, for that matter, anywhere. This
historic moment to advance equity must not be lost, and I
intend to do everything I can to ensure that it isn't.
Mr. Chairman, I look forward to the questions from the
Committee at your pleasure.
[The prepared statement of Secretary Vilsack follows:]
Prepared Statement of Hon. Thomas ``Tom'' J. Vilsack, Secretary, U.S.
Department of Agriculture, Washington, D.C.
Thank you, Mr. Chairman, Ranking Member Thompson, and Members of
this Committee.
When I testified in front of the Senate for my confirmation hearing
a few months ago, I said the world and our nation are different today
than when I served as Agriculture Secretary in a previous
Administration. The COVID-19 pandemic has changed all our lives and
will continue to do so until enough of us are vaccinated to put COVID
behind us. Some things, however, have not changed. The horrific
shootings in Atlanta last week remind us that hatred and bigotry toward
non-white Americans and gender-based violence are real, are threats,
and must end.
I am here today to discuss with you something not unrelated--the
systemic racism and discrimination perpetuated against Black farmers,
and the history of discrimination against Black farmers by USDA that
has prevented numerous African-Americans, among other people of color,
from fully realizing the same level of prosperity and success as their
white counterparts. Unfortunately, the racism that resulted in the
precipitous decline of Black farmers over the last century has also
been evidenced among other groups of socially disadvantaged farmers.
The Congress and the Department have attempted to address the
systemic racism and discrimination that has been repeatedly documented
and found to plague the programs at USDA, especially in the farm loan
programs. In the late 1990's, Congress took the unprecedented step of
waiving the statute of limitations to enable socially disadvantaged
producers to have the chance to be heard and receive some remedy for
the harm they suffered. Congress on several occasions provided funding
to support the settlement of these cases, which was accomplished while
I was previously in this position. During this time, Congress also
acknowledged through support of outreach and other efforts the need to
address the systemic discrimination these producers encountered. USDA
also undertook efforts of self-examination and reform including through
the work of the Civil Rights Action Team and an independent assessment
and identification of barriers to USDA programs.
The history of systemic discrimination against Black farmers has
been well-documented, including a 2003 U.S. Commission on Civil Rights
report which found that Black farm loan applications took 220 days to
process as compared to their white counterparts, or a more recent study
finding that although Black farmers are disproportionately
underrepresented among farmers, were foreclosed on at a higher rate
than any other race.
Despite all that has been done, clearly more needs to be done to
drive our efforts deeper. Here are two steps we must take. First, we
must redress the discrimination that has proven to be systemic,
evidently reflecting the way we have designed or implemented our
programs, laws and regulations. By focusing on determining whether
producers can prove specific, individualized discrimination, our past
actions have failed to do the necessary work tailored to addressing the
systemic discrimination socially disadvantaged producers face. Second,
we must establish the support systems to enable socially disadvantaged
producers to have the opportunity to succeed. Only with the
establishment of such systems, will we be able to finally address the
cumulative effect of discrimination and break the cycles that are
holding these producers back.
When I testified in front of the Senate, I committed to bold action
to address discrimination in all its forms across USDA agencies,
offices and programs. I pledged to ensure all programming is equitable
and works to root out systemic racism. And I promised to build one of
the most capable and diverse teams in the Federal Government, one that
looks like the America we serve.
Within the first 2 months of this Administration, USDA has
appointed and nominated an incredibly talented cadre of appointees,
reflective of a commitment to build a team that looks like America.
USDA field and state offices are often the front door of USDA for
producers and other stakeholders seeking support. From loan officers to
County Committees to State Directors, it is essential that we build a
pipeline and identify leaders for positions that represent the
diversity of America and share this Administration's commitment to
equity.
Additionally, in response to President Biden's Equity Executive
Order, EO 13985, USDA is examining opportunities to increase equity for
all underserved populations, ensuring access to healthy meals to tackle
nutrition insecurity, putting greater emphasis on our nation-to-nation
consultation practices with Tribal nations, and bringing an equity lens
to all strategic priorities, especially tackling the climate crisis and
improving the rural economy.
In short, we are building a USDA that represents and serves all of
America. Many of the new leaders who have joined our team have a
background working with producers. They share personal stories about
farmers of color being rejected for a farm loan or getting a loan too
late in planting season. Those farmers--some of whom you will hear from
today--will tell you that they never forget the sting or consequences
of that rejection, which can be long-lasting and even generational. In
addition, creating more equitable opportunities for Black farmers is a
rising tide that can lift all boats. As one study found, closing racial
gaps in wages, housing credit, lending opportunities, and access to
higher education would amount to an additional $5 trillion in gross
domestic product and six million jobs to the American economy over the
next 5 years.
I am here today to say that racism and discrimination have no place
at the Department of Agriculture. I will not tolerate it, and I am
committed to rooting it out and establishing a relationship with
producers that is built on a commitment to equity, trust and customer
service. One of the most important steps I took in my previous tenure
as Agriculture Secretary was to use authority granted under the 2002
Farm Bill to appoint voting members to over 385 Farm Service Agency
County Committees, addressing a longstanding inequity due to the under-
representation of socially disadvantaged farmers and ranchers. We must
ensure these important appointments continue and that these individuals
have privileges equal to the elected members.
I was pleased when the socially disadvantaged farmer provisions in
the American Rescue Plan began to come together. I'm grateful to you,
Mr. Chairman, for your leadership, alongside Chairman Bishop, and of
course Senators Booker, Warnock, and Chairwoman Stabenow.
From the beginning, these provisions recognized that on top of the
economic pain caused by the pandemic's impact on the economy and
agriculture, socially disadvantaged farmers are also dealing with a
disproportionate share of COVID infection rates, hospitalizations,
death and economic hurt.
The law provides funding to address longstanding racial equity
issues within the Department and across agriculture. It provides debt
relief for socially disadvantaged farmers and ranchers to respond to
the cumulative impacts of systemic discrimination and barriers to
access that have created a cycle of debt.
The new law also provides approximately $1 billion in additional
funding for assistance and support to socially disadvantaged producers
and groups. USDA is in the process of standing up a Racial Equity
Commission to identify and address barriers across USDA. The law also
directs USDA to invest in programs to facilitate land access,
strengthen outreach and education, business development, and more. USDA
is now engaged in a process of outreach and seeking feedback directly
from socially disadvantaged producers as we implement the law. This
will be a collaborative, inclusive process.
Before I close, I want to say that all of us here should want
successful farmers. We should want more farmers. We should want farmers
who can pass their land down to the next generation--who are role
models including for young people of color to take up farming and
ranching. We should want farming to be associated with equity and
opportunity and entrepreneurship--not racism and barriers and
intimidation. We should want farmers of color to have equal opportunity
to contribute to the diverse fabric of American agriculture. We should
make clear that prosperous farmers of color means a prosperous
agricultural sector and a prosperous America. And we should do
everything we can to make that possible. You have my commitment that I
will do just that.
Thank you for your time today.
The Chairman. Thank you, Mr. Secretary. Thank you very much
for your very good testimony that we have just heard.
Now, I want to recognize for 5 minutes our next panelist,
Mr. Boyd. You are now recognized to begin.
Mr. Boyd, you may be muted.
STATEMENT OF JOHN W. BOYD, Jr., FOUNDER AND
PRESIDENT, NATIONAL BLACK FARMERS ASSOCIATION, BASKERVILLE, VA
Mr. Boyd. There we go. I am sorry. Okay.
Mr. Chairman, thank you very much. First, glad to give
honor to God, first and foremost, and I would like to thank
you, the Ranking Member Thompson, Congressman Thompson, the
other congressperson from North Carolina, the Vice Chair, Alma
Adams. I have spent some time visiting with most Members of the
Agriculture Committee to talk to them about the plight of the
Black farmers this week, so I would like to thank all of the
Members who took time to visit with me personally to talk about
the plight of the Black farmers.
It is an honor to be here today to talk to you and this
Committee. This is a hearing, Mr. Chairman, that I personally
have been advocating for, for over 30 years. When I first began
to advocate and press the issue on Capitol Hill, we could never
even get a full Committee Agriculture hearing. The people who
are watching here, this is a very, very historic hearing and
nature. Where the only hearing we could get at that time was
with the Congressional Black Caucus in 1997 where all of the
Members participated and listened to the plight of Black
farmers. On behalf of every enslaved Black man in this country,
on behalf of every sharecropper in this country, on behalf of
every Black farmer who tilled the soil, past and present, we
thank you and this Committee for finally hearing our cries.
I am a fourth-generation farmer, and I was trained to farm
by my grandfather, Thomas Boyd, and also my other grandfather,
Lee Robinson, a sharecropper, and my father, John Boyd, Sr.,
who is probably watching this hearing today. I have a long,
rich history of farming along the Roanoke River in Mecklenburg
County, Virginia, where my great-grandfather, Andrew Boyd, was
a slave. We bring a lot of history and wealth and pride and
wisdom to this Committee today as we reach out to talk to you.
Currently today, I raise corn, wheat, and soybeans, but I
was trained as a tobacco, cotton, and peanut farmer. Many of
those things were bought out under the government buyouts, and
I, too, switched over to those types of commodities.
Today, as you know, Mr. Chairman, in your comments, we are
less than one percent of the nation's farmers, and we are
facing extinction. At the turn of the century, we were over one
million Black farm families strong, tilling 20 million acres of
land in this country. Today, we are down to 4\1/2\ million
acres of land in this country, and less than 50,000 Black
farmers in this country. We got to this place partly by the
United States Department of Agriculture and its discrimination,
and I can attest that discrimination was alive and well at the
Department of Agriculture, and we need to resolve the backlog
of complaints that exist there. We need to improve program
delivery at local offices around the country where those
farmers, even today when they walk into the office and inquire
about the Farmers of Color Act that recently passed, and we are
getting a snobby and disrespected type of tone from the local
offices, that they don't know anything about it and don't know
how it is going to move forward. That was the same type of
information that got us here in the first place, Mr. Chairman.
This Committee worked hard to get that measure passed and we
need to--I'm urging the Secretary today--and I heard his
comments--to move swiftly and implement the bill so that the
farmers can get the debt relief, and also the $29 billion that
was doled out in the Trump Administration, less than 0.01
percent went to Black farmers, 0.01 percent out of the $29
billion went to Black farmers, Mr. Chairman.
We can do better than that, and it was due to the act of
discrimination by using the same policies by rolling this
information out through the county offices, and is failing
because Black farmers don't trust the United States Department
of Agriculture. We have to find a better way to do that, and
that is why we named it, Mr. Chairman, the Last Plantation, and
rightfully so.
And today, we need to move in a more cohesive way. This
isn't a Republican issue. It is not a Democratic issue. It has
happened on the hands of all Presidents, and I have met with
Sonny Perdue, and it was the worst meeting in history for me as
a leader where he said Black farmers had to get big or get out.
He didn't need any tokens or people who didn't want to work on
these committees. That is the type of discrimination that Black
farmers are facing, and--it looks like I am running out of my
time, but I can talk to you, Mr. Chairman, about this all day
long.
I am looking forward to getting all of the questions and
input from this Committee, and again, thank you for having this
very, very important hearing.
[The prepared statement of Mr. Boyd follows:]
Prepared Statement of John W. Boyd, Jr., Founder and President,
National Black Farmers Association, Baskerville, VA
Dear Honorable Chairman David Scott, Vice Chair Alma Adams, and
Congressman Glenn ``GT'' Thompson, Ranking Member. Thank you for the
invitation. It is truly an honor to address your Committee hearing, A
Hearing to Review the State of Black Farmers in the U.S.
I am John Boyd, Founder and President of the National Black Farmers
Association (NBFA). The National Black Farmers Association seeks
justice in terms of the distribution of wealth, opportunities, and
privileges within the United States ``U.S.'' and U.S. territories.
The National Black Farmers Association (NBFA) is a nonprofit
501(c)[(3)] organization with farm training sites across the United
States in rural and urban areas. NBFA is a community-based organization
with a national constituency of over 116,000 members predominately in
42 states. Our membership consists of full-time farmers, part-time
farmers, land and timber owners and many concerned citizens. To date,
the organization continues to work diligently to improve the quality of
life in rural communities through improved agricultural outreach,
technical assistance, access to credit for small farmers, family farm
business development, food distribution, rural economic development and
environmental protection with a Memorandum of Understanding (MOU) with
United States Department of Agriculture (USDA), U.S. Forest Service and
Environmental Protection Agency.
As a national civil rights figure representing Black Farmers, I
have met with President Barack Obama, President Bill Clinton, President
George W. Bush and President Jimmy Carter. I have led dozens of
training sessions and community meetings across the nation, Africa and
Haiti serving as a social justice advocate for women, Native American
and Hispanic farmers in their pursuit to fair access to USDA programs
and services. As a result, I am highly regarded in the farm community
as someone ``who cares'' and has access to critical information about
programs for Black and other minority, youth, veteran, women and
limited resource farmers with a proven ability to deliver high-quality
technical advice and solutions. The latest example of my personal
commitment and corporate resolve to ensure civil, economic,
environmental and social justice and fiscal responsibility for NBFA
members and other small-scale farmers is the NBFA call to action
``ReClaiming, ReGaining, and ReGenerating Our Family Farms''.
The NBFA has been providing sustainable agriculture workshops and
conferences for over 30 years due to the ongoing injustices faced by
Black and other minority farmers. The NBFA provides all educational
outreach training initiatives, direct technical assistance and
conferences free of charge to attendees and open invitation for all to
attend in accordance with the MOU between USDA, EPA, U.S. Forest
Service. SC Commission for Minority Affairs and the NBFA.
I am a fourth-generation farmer, maintaining about 1,300 acres in
Southside, Virginia, where I grow soybeans, wheat, corn and raise beef
cattle.
The long history of discrimination by the United States Department
of Agriculture (USDA) is not in dispute.
Scholars, commissions, the courts, and even the Department itself
have confirmed that USDA systematically denied loans, subsidies and
other benefits to Black farmers that were routinely provided to white
farmers.
In 1965, the U.S. Commission on Civil Rights found \1\ that
discrimination in farm programs had contributed to a decline in
Black ownership of farmland.
---------------------------------------------------------------------------
\1\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1965_USCCR-Report.pdf.
In 1968, the U.S. Commission on Civil Rights found \2\ that
Black farmers faced discrimination when seeking farm loans and
other forms of assistance.
---------------------------------------------------------------------------
\2\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1968_USCCR-Report.pdf.
In 1970, the U.S. Commission on Civil Rights found \3\
discrimination in the administration of USDA programs.
---------------------------------------------------------------------------
\3\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/cr12en2.pdf.
1982, the U.S. Commission on Civil Rights documented \4\
discrimination complaints at USDA county offices.
---------------------------------------------------------------------------
\4\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1990_House-Report.pdf.
In 1995, the [General Accounting] Office found \5\ USDA
county committees had few people of color.
---------------------------------------------------------------------------
\5\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1995_Minorities-and-Women-on-Farm-
Committees.pdf.
In 1996, a study for USDA's Farm Services Agency found \6\
farmers were not getting an equitable share of farm payments
and loans.
---------------------------------------------------------------------------
\6\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1996_DJ-Miller-Report.pdf.
In 1997, USDA's Inspector General documented \7\ a ``climate
of disorder'' among USDA civil rights staff.
---------------------------------------------------------------------------
\7\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1997_IG-Report.pdf.
In 1997, the Civil Rights Action Team created by USDA
documented \8\ stories of discrimination against farmers of
color.
---------------------------------------------------------------------------
\8\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1997-crat-report.pdf.
In 1998, the USDA's Commission on Small Farms cites \9\
discrimination as a cause of the decline of Black farmers.
---------------------------------------------------------------------------
\9\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1998-NCSF-Report.pdf.
In 1999, a Federal court found \10\ USDA discriminated
against Black farmers by denying or delaying loans.
---------------------------------------------------------------------------
\10\ https://acresofancestry.org/wp-content/uploads/2021/01/April-
1999-Court-Opinion-Approving-Consent-Decree-.pdf.
In 2001, the U.S. Commission on Civil rights found \11\
Black farmers waited four times longer than white farmers to
receive farm loans.
---------------------------------------------------------------------------
\11\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/2001_USCCR-Report.pdf.
In 2008, the Government Accountability Office reported \12\
that USDA had still not resolved many discrimination
complaints.
---------------------------------------------------------------------------
\12\ https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/2008_GAO-Report.pdf.
But discrimination is not something that I read about in a report
or a court transcript. I have attached to my testimony the reports by
the Commission on Civil Rights, the Department of Agriculture, and the
Government Accountability Office as well as written testimony I have
presented to Congress over the years as the NBFA President that
document this history of discrimination, differential treatment, and
breach of trust by USDA. They also detail the struggle the NBFA has
encountered at the USDA to end racial discrimination and achieve
justice for Black Farmers as the NBFA was a named plaintiff in In Re
Black Farmers Discrimination and has filed objections and sought legal
remedies to protect Black Farmers in America.
In 1983, I was introduced to the USDA Farmers Home Administration
(now known as Farm Service Agency) by an elderly Black farmer who was
fighting off foreclosure. Once I purchased the farm with a farm
ownership loan, the lien was recorded in the local county courthouse.
That was the being of my relationship or lack thereof that brings me
before you today to discuss the ``State of Black Farmers''. I
experienced racial discrimination personally when I sought farm
operating loans from the Department. I was called ``boy.'' I was spit
on. My loan applications on numerous occasions were torn up and thrown
in the trash while I watched. Upon investigation by the USDA Office of
Civil Rights, several applications were found unprocessed in my USDA
file. In my county office, Black farmers were only seen on Wednesday--
or what came to be known as ``Black Wednesday.'' When Black farmers
received USDA loans they were assigned ``supervised'' bank accounts
which required white loan officers to co-sign every transaction.
As a result of differential treatment and discrimination against
Black farmers like myself, the number of Black farmers has fallen
dramatically--from more than 900,000 in 1920 to less than 50,000 today.
Unfortunately, the effects of discrimination by the Department can
be felt decades after reaching historic settlement agreements. I
reached a settlement agreement with USDA in 1997 which provided
complete debt relief. In 2019, I was informed that USDA had breached
the settlement agreement and over $600,000 in USDA liens remained
against my farm according to a title search. I filed a complaint
against USDA for Breach of Agreement and Retaliation because the
amounts recorded in the liens were erroneous and the prepared
Certificates of Satisfaction to release the liens had been prepared but
never executed or filed as they remained unsigned by the local county
FSA official in my USDA file. It wasn't until I secured and paid for
the services of an attorney to file these Certificates that my farm was
no longer in jeopardy of [land loss] at the hands of the USDA. This
wasn't the 1st time USDA officials had failed to act upon my behalf and
I am here today because I want to openly address why the NBFA has
continued to call for accountability and transparency at the Department
in 2021. Too many Black Farmers continue to request our assistance to
address program complaints and civil rights violations.
Discrimination continues to be reflected and reinforced by current
USDA programs.
While Black farmers receive about $60 million in annual commodity
subsidies, white farmers annually receive about $10 billion in
commodity subsidies.
While an eligible Black farmer receives, on average, $7,755 in
commodity subsidies, an eligible white farmer receives, on average,
$17,206 in commodity subsidies.
Like commodity subsidies, ad hoc disaster payments also
overwhelmingly flow to white farmers.
Experts found that 99% of the Market Facilitation Payments made to
offset the effects of President Trump's trade war went to white
farmers. Experts also found that 97% of Coronavirus Food Assistance
Payments made to address the [COVID]-19 pandemic went to white farmers.
The disparity in the crop insurance program--which requires a
farmer-paid premium many Black farmers cannot afford--may be even
greater, but Congress will not lift the veil of secrecy that hides who
receives crop insurance subsidies.
As you know, arm income support payments are tied to production or
revenue. The largest 10% of subsidy recipients collect more than half
of all subsidies. Virtually all of these farmers are white.
The result of decades of discrimination is that Black farms are
smaller, and our revenues are smaller than those of our white
neighbors. Therefore, eligible Black farmers receive less support from
USDA and fall further and further behind. What's more, a
disproportionate share of Black farmers produce farm products that are
not even eligible for traditional subsidies.
Rather than right these historic wrongs, government programs have
largely perpetuated systemic racism.
In response to discrimination by the Department, I joined with
other farmers to sue USDA, which resulted in the Pigford and In Re:
Black Farmers Discrimination settlements. By acknowledging the long
history of discrimination, the Black Farmer settlements were an
important first step. But they failed to provide farmers the debt
relief Black farmers needed.
During the Trump Trade war, it was unacceptable that foreign owned
corporations benefited at an alarming rate while tax-paying American
farmers such as myself received min[u]scule amounts of the relief
designated with stated purpose to help American Farmers. Economic
fairness was at stake in that matter but failed to provide much needed
relief for the disruption to our farms.
On June 19, 2019, I testified before the U.S. Financial Services
Committee. I stated, ``Unless there is a set aside amount for support
of small-scale farmers in the proposed $16 Billion Bailout, we will be
treated as invisible and insignificant participants in the process.
Policy decisions regarding farmers will continue to disproportionately
reward foreign-owned corporations and exclude already disadvantaged
farmers in our category. Justice would be served in the current crisis
by a vote for bipartisan legislation from this Committee to set aside
$5 Billion to help address the needs of Black and other small-scale
farmers. Fair treatment is all we are asking. Just justice.'' \13\
---------------------------------------------------------------------------
\13\ https://docs.house.gov/meetings/BA/BA10/20190619/109679/HHRG-
116-BA10-Wstate-BoydJ-20190619-U1.pdf (video testimony: https://
youtu.be/Ibm-zA4wQII)
---------------------------------------------------------------------------
By providing debt relief to Black farmers and other farmers of
color, the American Rescue Plan Act begins to fulfil the promises of
the Black Farmers lawsuits and, more importantly, gives new life to
Black farmers facing foreclosure. But there is still much more to be
done to right these historic wrongs and to ensure that Black farmers
remain part of the fabric of American agriculture.
To support Black farmers, we must reform our subsidy and crop
insurance programs to level the playing field between white farmers and
Black farmers. We must make these programs more transparent, so Black
farmers can see whether promised reforms are actually working. We must
expand access to land and credit so that Black farmers can expand our
operations. And we must improve outreach and technical assistance to
Black farmers who have been treated as second-class citizens by the
Department for too long.
Thank you, Chairman Scott, for holding this historic hearing.
Appendix
Editor's note: the documents listed were submitted by the witness
as an Appendix. They are listed here in the order that they were
submitted. Due to its size the Appendix is retained in Committee file,
and the individual documents are available online at the hyperlinks
noted. Note: items marked with () denote that in addition to the
excerpt the full report is retained in Committee file.
1. USDA RBS Research, Report 194: Black Farmers in America, 1865-
2000 The Pursuit of Independent Farming and the Role of
Cooperatives (https://www.rd.usda.gov/files/RR194.pdf) \14\
---------------------------------------------------------------------------
\14\ Note: contained further on in the Appendix is an excerpt from
this report, p. 24 (Appendix Table 3--Farm operators in the U.S. by
race, 1900 to 1997).
2. USDA NASS, 1964 Census of Agriculture, Vol. 2, Part 8, Color,
Race, and Tenure of Farm Operator (http://lib-usda-
05.serverfarm.cornell.edu/usda/AgCensusImages/1964/02/08/
1964-02-08.pdf), Table 4. Number of Negro and Other
Nonwhite Farm Operators, by Regions and States: 1900 to
---------------------------------------------------------------------------
1964, p. 761
3. USDA NASS, 1964 Census of Agriculture, Vol. 2, Part 8, Color,
Race, and Tenure of Farm Operator (http://lib-usda-
05.serverfarm.cornell.edu/usda/AgCensusImages/1964/02/08/
1964-02-08.pdf), Table 3. Number of Farms by Color and by
Tenure of Operator, and Land in Farms by Tenure and
Operator, by Regions and States: 1880 to 1964, p. 756
4. U.S. Commission on Civil Rights, 1965, Equal Opportunity in Farm
Programs: An Appraisal of Services Rendered by Agencies of
the United States Department of Agriculture. A Report of
the United States Commission on Civil Rights, 1965 (http://
files.eric.ed.gov/fulltext/ED068206.pdf)
5. U.S. Commission on Civil Rights, 1965, Civil Rights Under Federal
Programs: An Analysis of Title VI of The Civil Rights Act
of 1964 (https://hdl.handle.net/2027/mdp.39015019789091)
\15\
---------------------------------------------------------------------------
\15\ Note: this document is available at a variety of university
sites; however, in all extant instances they are using the ``Digitized
by Google'' copy.
6. U.S. Commission on Civil Rights, 1970, Federal Civil Rights
Enforcement Effort: A Report of The United States
Commission on Civil Rights 1970 (https://
www2.law.umaryland.edu/marshall/usccr/documents/
---------------------------------------------------------------------------
cr12en2.pdf), pp. I-III, 48-49
7. USDA, January 1981, A Time to Choose: Summary Report on the
Structure of Agriculture (https://archive.org/details/
timetochoosesumm00unit/page/n1/mode/2up)
8. U.S. Commission on Civil Rights, February 1982, The Decline of
Black Farming in America (https://files.eric.ed.gov/
fulltext/ED222604.pdf)
9. USDA, Economic Research Service, July 1986, Rural Development
Research Report Number 59, Black Farmers and Their Farms
(https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1982_USDA-History.pdf)
10. House Rept. 101-984, The Minority Farmer: A Disappearing American
Resource; Has The Farmers Home Administration Been The
Primary Catalyst? (https://books.google.com/books/download/
Congressional_Serial_Set.pdf) \16\
---------------------------------------------------------------------------
\16\ Note: the submission in the Appendix document is from a
LexisNexis printout of the House report. The item retained in Committee
file is a pdf excerpted from the Congressional Serial Set 14029
digitized by Google.
11. USDA, February 1997, Civil Rights at the United States Department
of Agriculture: A Report by the Civil Rights Action Team
(https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1997-crat-report.pdf), p.
---------------------------------------------------------------------------
9
12. U.S. DOJ, 1994, Vol. 18, Authority of USDA to Award Monetary
Relief for Discrimination \17\ (https://www.justice.gov/
olc/file/626886/download), pp. 52-73
---------------------------------------------------------------------------
\17\ Note: this is an excerpt from the U.S. Department of Justice
report entitled, Opinions of the Office of Legal Counsel of the United
States Department of Justice Consisting of Selected Memorandum Opinions
Advising the President of the United States, the Attorney General and
Other Executive Officers of the Federal Government in Relation to Their
Official Duties, Volume 18, 1994.
13. U.S. GAO, September 29, 1995, GAO/GGD-95-211, Equal Employment
Opportunity Women and Minority Representation at Interior,
Agriculture, Navy, and State (https://www.gao.gov/assets/
---------------------------------------------------------------------------
ggd-95-211.pdf)
14. U.S. GAO, March 1, 1995, GAO Decision, B-260588, RCED-95-113R,
Minorities and Women on Farm Committees (https://
www.gao.gov/assets/rced-95-113r.pdf)
15. USDA FSA, March 4, 1996, D.J. Miller Disparity Study Final
Report, Producer Participation and EEO Complaint Process
Study for the Farm Service Agency (FSA) of the U.S.
Department of Agriculture, Part I, Vol. I-II (https://
static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/1996_DJ-Miller-
Report.pdf)
16. USDA CRIT, September 1997, Implementation of the Civil Rights
Action Team Report at USDA: An Interim Progress Report
(https://permanent.fdlp.gov/lps15852/critprog.pdf)
17. U.S. GAO, March 19, 1997, GAO/T-RCED-97-112, Farm Programs:
Efforts to Achieve Equitable Treatment of Minority Farmers
(https://www.gao.gov/assets/t-rced-97-112.pdf)
18. USDA OIG, February 27, 1997, Report No. 50801-2-Hq(1), Report for
the Secretary on Civil Rights Issues--Phase I, Farm Loan
Programs--Civil Rights Complaint System Evaluation (https:/
/www.usda.gov/sites/default/files/oig.htm)
19. U.S. District Court for D.C., April 14, 1999, Civil Action No 97-
1978 (PLF), Timothy C. Pigford, et al., Plaintiffs, v. Dan
Glickman, Secretary, The United States Department Of
Agriculture, Defendant. Civil Action No. 98-1693 (PLF),
Cecil Brewington, et al., Plaintiffs, v. Daniel R.
Glickman, Defendant, Notice of Class Certification and
Proposed Class Settlement (https://www.dm.usda.gov/
pigford.pdf)
20. USDA NCSF, January 1998, A Time to Act: A Report of the USDA
National Commission on Small Farms (https://archive.org/
download/timetoact
1545usda/timetoact1545usda.pdf)
21. U.S. District Court for D.C., April 14, 1999, Civil Action No 97-
1978 (PLF), Timothy C. Pigford, et al., Plaintiffs, v. Dan
Glickman, Secretary, The United States Department of
Agriculture, Defendant. Civil Action No. 98-1693 (PLF),
Cecil Brewington, et al., Plaintiffs, v. Daniel R.
Glickman, Defendant, Opinion (https://
media.dcd.uscourts.gov/pigfordmonitor/orders/
19990414op.pdf)
22. USDA NRCS, undated, Civil Rights at USDA: A Backgrounder on
Efforts by the Obama Administration (https://
www.law.umich.edu/facultyhome/margoschlanger/Documents/
Publications/Offices_of_Goodness/USDA Civil Rights at USDA
A Backgrounder on Efforts by the Obama Administration.pdf)
23. U.S. Commission on Civil Rights, February 2001, Racial and Ethnic
Tensions in American Communities: Poverty, Inequality, and
Discrimination. Volume VII: The Mississippi Delta Report
(https://files.eric.ed.gov/fulltext/ED457307.pdf)
24. USDA NASS, June 2004, 2002 Census of Agriculture, AC-02-A-51,
United States Summary and State Data, Volume 1, Geographic
Area Series, Part 51 (http://lib-usda-
05.serverfarm.cornell.edu/usda/AgCensusImages/2002/01/51/
2002-01-51.pdf), pp. 48-49
25. USDA NASS, December 2009, 2007 Census of Agriculture, AC-07-A-51,
United States Summary and State Data, Volume 1, Geographic
Area Series, Part 51 (https://www.nass.usda.gov/
Publications/AgCensus/2007/Full_Re
port/Volume_1,_Chapter_1_US/usv1.pdf), pp. 58-61
26. U.S. GPO, 110-246, Statute Compilation, December 20, 2018, 110-
246--Food, Conservation, and Energy Act of 2008.xml
(https://www.agriculture.senate.
gov/imo/media/doc/110-246_Food, Conservation, And Energy
Act Of 2008.pdf), pp. 92-95 \18\
---------------------------------------------------------------------------
\18\ Note: the full compilation is retained in Committee file.
Further note: the compilation has been updated as of January 8, 2019
(https://www.govinfo.gov/content/pkg/COMPS-10237/pdf/COMPS-10237.pdf).
27. U.S. GAO, October 22, 2008, GAO-09-62, U.S. Department of
Agriculture: Recommendations and Options to Address
Management Deficiencies in the Office of the Assistant
Secretary for Civil Rights (https://www.gao.gov/assets/gao-
---------------------------------------------------------------------------
09-62.pdf)
28. Committee on Oversight and Government Reform Hearing,
Subcommittee on Government Management, Organization, and
Procurement, May 14, 2008 Management of Civil Rights at the
USDA (https://www.govinfo.gov/content/pkg/CHRG-
110hhrg48172/pdf/CHRG-110hhrg48172.pdf), Serial No. 110-137
29. USDA OASCR, November 5, 2010, Informational Memorandum for Deputy
Chief of Staff to the Secretary, Proposed Resolution to
Adjust the Recorded Yields of Black Farmers in Clarendon
County, South Carolina (https://static.ewg.org/reports/
2021/BlackFarmerDiscriminationTimeline/2010_Black-Farmers-
Yield-Clarendon-SC.pdf)
30. U.S. DOJ, February 18, 2010, Department of Justice and USDA
Announce Historic Settlement in Lawsuit by Black Farmers
Claiming Discrimination by USDA (https://www.justice.gov/
opa/pr/department-justice-and-usda-announce-historic-
settlement-lawsuit-black-farmers-claiming)
31. 111th Congress, H.R. 2847, An Act making appropriations for the
Departments of Commerce and Justice, and Science, and
Related Agencies for the fiscal year ending September 30,
2010, and for other purposes. (https://www.congress.gov/
111/bills/hr2847/BILLS-111hr2847eah.pdf), pp. 90-97 \19\
---------------------------------------------------------------------------
\19\ Note: the bill was signed into law (Public Law 111-147
(https://www.congress.gov/111/plaws/publ147/PLAW-111publ147.pdf)) March
18, 2010.
32. USDA Office of the Administrative Law Judges, Office of Hearings
and Appeals, February 13, 1984, SOL Docket No. 09-0177
Charles McDonald, Complainant v. Tom Vilsack, Secretary,
United States Department Of Agriculture, Decision and Order
(https://oalj.oha.usda.gov/sites/default/files/100708SOL09-
---------------------------------------------------------------------------
0177DO.pdf)
33. USDA NASS, May 8, 2019, 2012 Census of Agriculture, Race,
Ethnicity and Gender Profiles, United States (https://
www.nass.usda.gov/Publications/AgCensus/2012/
Online_Resources/Race,_Ethnicity_and_Gender_Profiles/
cpd99000.pdf)
34. USDA NASS, September 2014, ACH12-10, 2012 Census of Agriculture
Highlights, Black Farmers: Up 12 percent since 2007; most
live in southern states (https://www.nass.usda.gov/
Publications/Highlights/2014/Highlights_
Black_Farmers.pdf)
35. U.S. District Court for D.C., April 1, 2012, Civil Action No 97-
1978-PLF, Document 1812, Monitor's Final Report on Good
Faith Implementation of the Consent Decree and
Recommendation for Status Conference (https://
media.dcd.uscourts.gov/pigfordmonitor/reports/
Rpt20120331_final.pdf) \20\
---------------------------------------------------------------------------
\20\ Note: there is an Appendix (https://media.dcd.uscourts.gov/
pigfordmonitor/reports/Rpt20120331_final-app.pdf) to the report. This
document was not included in the submission; therefore, it is also
retained in Committee file.
36. USDA NASS, September 2, 2020, 2017 Census of Agriculture, Race,
Ethnicity and Gender Profiles, United States (https://
www.nass.usda.gov/Publications/AgCensus/2017/
Online_Resources/Race,_Ethnicity_and_Gender_Profiles/
---------------------------------------------------------------------------
cpd99000.pdf)
37. USDA NASS, April 2019, 2017 Census of Agriculture, AC-17-A-51,
United States Summary and State Data, Volume 1, Geographic
Area Series, Part 51 (https://www.nass.usda.gov/
Publications/AgCensus/2017/Full_Report/
Volume_1,_Chapter_1_US/usv1.pdf), pp. 72-75
38. U.S. GAO, July 11, 2019, GAO-19-539, Agricultural Lending:
Information on Credit and Outreach to Socially
Disadvantaged Farmers and Ranchers Is Limited (https://
www.gao.gov/assets/gao-19-539.pdf)
39. Warren Democrats, undated, Addressing Discrimination and Ensuring
Equity for Farmers of Color (https://elizabethwarren.com/
plans/equity-farmers-of-color)
40. Onika Abraham, Director, Farm School NYC, New York, et al.,
letter dated August 31, 2019, Re: Justice for Black Farmers
(https://static.ewg.org/reports/2021/
BlackFarmerDiscriminationTimeline/2019_WARREN-LETTER.pdf)
41. 116th Congress, S. 4929, Justice for Black Farmers Act of 2020
(https://www.congress.gov/116/bills/s4929/BILLS-
116s4929is.pdf)
42. U.S. GAO, February 24, 2021, GAO-21-399T, Financial Services:
Fair Lending, Access, and Retirement Security (https://
www.gao.gov/products/gao-21-399t)
43. 117th Congress, H.R. 1319, Union Calendar No. 1, American Rescue
Plan Act of 2021 (https://www.congress.gov/117/bills/
hr1319/BILLS-117hr1319rh.
pdf) \21\
---------------------------------------------------------------------------
\21\ Note: the bill was signed into law (Public Law 117-2) March
11, 2021; however, as of this date (April 6, 2021) the Public Law has
not been published the enrolled version (https://www.congress.gov/117/
bills/hr1319/BILLS-117hr1319enr.pdf) is the latest available copy.
44. Emergency Relief for Farmers of Color Act (https://
static.ewg.org/reports/2021/
---------------------------------------------------------------------------
BlackFarmerDiscriminationTimeline/2021_Warnock.pdf)
Submitted as Separate Items (Not in Appendix), the documents that
are available online will not be republished herein, and are available
at the hyperlinks noted.
1. USDA, Apr. 2020, Commitment to Progress: Civil Rights at the
United States Department of Agriculture (https://
archive.org/details/CAT11079176)
2. Case: 20-16758, February 19, 2021, National Association of Wheat
Growers, et al., Plaintiffs--Appellees, v. Xavier Becerra,
in His Official Capacity as Attorney General of the State
of California, Defendant--Appellant, and Lauren Zeise, in
Her Official Capacity as Director of the Office of
Environmental Health Hazard Assessment, Defendant. Amicus
Curiae Brief of the National Black Farmers Association in
Support of Appellant and Reversal (https://docs.house.gov/
meetings/AG/AG00/20210325/111400/HHRG-117-AG00-Wstate-
BoydJ-20210325-SD013.pdf)
Submission No. 3
January 28, 1997
Informational Memorandum to the Secretary
Subject: Discrimination Complaints filed by Minority Farmers in the
State of Virginia
To: Dan Glickman, Secretary of Agriculture
From: Lloyd A. Jones, State Director, USDA Rural Development
The purpose of this memorandum is to provide an overview and
general assessment of the activities and process which lead to
preliminary investigations of alleged discriminatory practices at the
local level of the United States Department of Agriculture (USDA). This
memorandum is intended to serve as a confirmation that discriminatory
practices appear to have imposed themselves upon our external customers
(in particular, minority farmers) in Mecklenburg, Brunswick, Lunenburg
and other counties in southside and southeastern Virginia. It is my
opinion that these discriminatory practices are the result of three
main components which are noted as follows: super intense regulatory
barriers which are unfriendly to the small producers, poor quality
customer service (with a healthy portion of weak employee performance),
and a lack of sensitivity for the needs and limited resources of small
producers (to include an apparent unwillingness to communicate with
some producers in a manner that they could understand the regulatory
requirements imposed by the agency, meaning the Farmers Home
Administration, in the customer's attempt to obtain a loan or to
service an existing loan) by some employees within USDA. This report is
my effort to relay to you a chronology of events that took place in
response to charges that were brought to my attention by minority
farmers.
As a former career, and currently a political appointee, civil
servant, I have worked for the Department of Agriculture for more than
20 years. During that time, I have had the opportunity to observe and
react to issues that could be construed as poor customer service. It is
my belief that the support and enforcement of the civil rights and EEO
law within USDA have been monumental challenges for both senior and
mid-level management. As a State Director, it is my responsibility to
make sure that these laws, as mandated by Congress and the Clinton
Administration, are successfully administered.
Recently, there has been a flurry of complaints, allegations,
innuendoes and misstatements concerning discrimination complaints and
activities within the Farmers Home Administration (FmHA) in Virginia.
The following chronological history of events that took place should
clarify most, if not all, of these allegations.
Chronological History
John W. Boyd, Jr.
February 19, 1992--A discrimination complaint was received from Mr.
Boyd by the Farmer Programs Chief, Herman Lundy, and the State Civil
Rights Manager, Ava Marshall.
February 24, 1992--A copy of the discrimination complaint was sent
to the National Office Equal Opportunity Division in Washington, D.C.
April 2, 1992--The State Director notified the County Supervisor of
problems found in a review of Mr. Boyd's case by the Farm Division in
the State Office which indicated that application and loan processing
had been handled inappropriately. An explanation was requested.
April 21, 1992--The County Supervisor wrote a response to the State
Director's request indicating he believed he had handled Mr. Boyd's
case in all fairness and in accordance with FmHA procedures.
June 22, 1992--The State Director notified the County Supervisor of
the importance of processing requests within the timeframes stated in
FmHA procedures.
July 17, 1992--A request for preliminary inquiry was received by
the State Office from the National Office Equal Opportunity Staff for
investigation.
Due to illness, Ava Marshall was unable to act on the preliminary
inquiry for approximately 45 days. She communicated with the National
Office on several occasions to inform them of her efforts to respond to
their request.
April 9, 1993--Ava Marshall became seriously ill and was diagnosed
with multiple sclerosis.
On or about May 9, 1993--A Civil Rights team from Mississippi came
to the Virginia State FmHA office to assist in completing the
preliminary inquiry assignment which was being conducted by Ava
Marshall.
May 12, 1993--The State Director wrote to the County Supervisor
acknowledging that the restructuring of Mr. Boyd's farm loans were not
completed. The County Supervisor did not follow instructions at the
time he ran the Debt Adjustment Loan Restructuring System (DALR$)
program. He forgot to include the $5,000.00 Operating Loan. The County
Supervisor was directed to take appropriate corrective actions within
thirty (30) days.
May 14, 1993--A loan review made by Russell L. Marsh, Farmer
Programs Chief, indicated this case had not been properly handled by
James Garnett, the Chase City County Supervisor. Mr. Boyd had no chance
of meeting his obligations due to the failure to properly service his
loan accounts by the County Supervisor. His FmHA accounts had been
referred to a credit bureau by the County Supervisor and is currently
showing up as delinquent when, in fact, they should be current. Mr.
Boyd also stated that a payment of $3,100.00 made in late 1992 was
never credited to his account. The County Supervisor was given thirty
(30) days to correct these actions.
June 1, 1993--The findings of the team from Mississippi were sent
to the National Office Equal Opportunity Staff.
On or about December 12, 1993--Doug McDowell, Equal Opportunity
Specialist, from the National Office called Ava Marshall, State Civil
Rights Manager, and informed her the Mississippi report was
unsatisfactory and more information was needed on this case.
January 4, 1994--A new request for additional information was sent
to Ava Marshall to research, gather information, and prepare a report
which required a considerable amount of time.
June 16, 1994--Ava Marshall, State Civil Rights Manager, compiled
and sent new information with recommendations and conclusions to
Washington, D.C.
June 24, 1994--The State Civil Rights Manager met with Russell Lee
Marsh, Farmer Programs Chief, to discuss payments Mr. Boyd indicated
were made and not credited to his account. The wrong amount was
credited to Mr. Boyd's account and too much was given to another
borrower. Mr. Marsh instructed the County Office to reverse the payment
from the other borrower's account and apply the correct amount to Mr.
Boyd's account. They are to notify Mr. Marsh when this is completed.
Once completed, everything in the original May 12, 1993, memorandum
must still be done. He indicated this needed to be done right away so
the accounts could be properly set up, and the loan be serviced in
accordance with FmHA Instructions.
July 14, 1994--The State Director notified Sharron Longino,
Associate Administrator, FmHA, that after Mr. Boyd having been in
business for ten (10) years, the FmHA Chase City County Supervisor's
actions had put him further behind in his farming operations and debt
servicing than he was when he started. Mr. Boyd had no farm income to
pay his loans and relied totally on non-farm income for his family
living expenses. FmHA was holding a mortgage on Mr. Boyd's farm with a
new poultry house which was not even being utilized. The County
Supervisor and District Director provided no supervisory support to Mr.
Boyd which increased his chances for failure.
August 15, 1994--The National Office Farmer Programs Division
reviewed Mr. Boyd's case and provided specific recommendations to the
Equal Opportunity Staff for reconciling the problems with this case.
September 12, 1994--The National Office responded with corrective
servicing actions to resolve this case.
October 11, 1994--Mr. Boyd and his attorney met with the State
Director, the Farmer Programs Chief, and six (6) other members of the
FmHA staff to discuss items outlined in the letter from the National
Office.
October 24, 1994--The State Director wrote to Mr. Boyd notifying
him of the corrective actions that were to be taken by the Chase City
County Office concerning his farm accounts.
October 24, 1994--The State Director wrote to Mr. Boyd notifying
him of actions taken on his FmHA rural housing application.
November 1, 1994--The State Director responded to the National
Office regarding the outcome of the letter dated September 12, 1994.
This letter indicated that all corrective actions suggested by the
National Office were not completed. Mr. Boyd was not satisfied with the
results of the meeting or the actions taken by the State Office staff,
and proceeded to inform the National Office that he wanted to continue
with his complaint as filed.
January 10, 1995--The new Chase City County Supervisor, Anne J.
Rickman, provided the State Director with an update on the status of
Mr. Boyd's loan restructuring and information needed on an operating
loan.
October 1, 1995--Farm Service Agency assumed responsibility for
agricultural credit lending activities.
April 5, 1996--J. Calvin Parrish, Acting State Executive Director,
Farm Service Agency, sent Mr. Boyd a copy of his 1992 original
discrimination complaint.
October 11, 1996--The final decision of USDA, signed by Wardell C.
Townsend, Jr., Assistant Secretary for Administration and Designated
Director of Equal Opportunity Officer, on John Boyd's February 18, 1992
complaint alleging discrimination based on race, found that
discrimination on the basis of race had occurred and ordered corrective
actions be offered.
November 26, 1996--Otis Dailey, District Director, Farmville,
Virginia, reported that according to the final decision from Wardell C.
Townsend, Jr., the Assistant Secretary for Administration and
Designated Director of Equal Opportunity Officer dated October 11,
1996, the complainant met with him in April 1988 to express concerns
about James Garnett failing to process loan applications and the
acceleration of John Boyd's account. Mr. Dailey said that he does not
deny meeting with Mr. Boyd, but he does not remember it. Mr. Dailey
reported he does not recall Mr. Boyd contacting or attempting to
contact him until the summer of 1996 concerning a 502 Rural Housing
application he filed in the Chase City Office and assigned to the
District Office for processing. Prior to the appeal date set up by the
Appeals Officer, Mr. Boyd called and requested information from his
file for the meeting. Mr. Dailey met Mr. Boyd in Chase City and
assisted him with what he needed for the appeal. The day Mr. Boyd met
with Mr. Dailey, Mr. Boyd asked that he follow him out of the office
into the hall. Mr. Boyd made statements about Mr. Garnett's handling of
his farm loans, and felt it was because of his race. Again, Mr. Boyd
said that he met with Mr. Dailey years ago about the charges made
against Mr. Garnett. Mr. Dailey stated that there were no specific
incidents that could be considered discriminatory.
Mr. Dailey was notified by memorandum from the State Director that
Mr. Boyd had filed a Civil Rights complaint alleging discrimination. In
June 1993, Anne Rickman, District Farm Specialist, was assigned to the
District Office. All responsibilities for farm loans were designated to
Anne Rickman. The Farm Program was handled by the State Office through
the District Farm Specialist. Mr. Dailey reported that, at that time,
he was distanced from farm activities in the District Office and the
John Boyd case. In a discussion with the District Farm Specialist, Anne
Rickman, later to be the new Chase City County Supervisor, it was
reported the complainant's requests were being taken care of to resolve
the concerns. Mr. Dailey stated he had had no contacts with Mr. Boyd
since being informed that his complaint had been turned over to the
State Civil Rights Manager in 1992. Mr. Dailey states specifically, as
District Director, he was not involved ``in the loop.'' Mr. Dailey
stated that in his position, it was like one hand did not know what the
other was doing. Mr. Dailey stated that the District Farm Specialist
representing him was actively and aggressively working towards
``fixing'' Mr. Boyd's loan problems, thereby keeping him on his farm
and operational. Mr. Dailey stated that in discussions with the
District Farm Specialist and regular contacts with the County Office,
it was reported Mr. Boyd's problems were being handled. Mr. Dailey met
with Mr. Boyd in the summer of 1996 in the Chase City Office. Mr.
Dailey said it is to be noted that he was questioned about this case,
officially, approximately February 1994. This was after the County
Supervisor had been forced to accept a transfer or separate from the
agency, and the performance appraisal for the County Supervisor had
been completed. Mr. Dailey stated that his comments were taken out of
``context'' during the February 1994 meeting.
Chronological History
Willie L. Crute, Jr.
January 22, 1994--Discrimination complaint was filed by Mr. Willie
Crute based on race against James Garnett, County Supervisor, Chase
City, Virginia.
February 17, 1994--A copy of the discrimination complaint was sent
to the National Office Equal Opportunity Division by the State
Director.
March 18, 1994--Freedom of Information Act (FOIA) request was
submitted to Lloyd A. Jones, State Director, by Mr. Crute's attorney,
requesting documents related to loan applications filed by Mr. Willie
L. Crute, Jr.
April 20, 1994--Freedom of Information Act request was denied in
part and appeal rights were given by Randall M. Welch, FOIA Officer.
May 23, 1994--Request for preliminary inquiry into this complaint
was requested by Carlton L. Lewis, Chief, Program Compliance Branch,
Equal Opportunity Staff, FmHA, National Office.
June 2, 1994--Freedom of Information Act appeal requested by Mr.
Crute's attorney on the initial request for information.
July 1, 1994--Freedom of Information Act request was made by Willie
L. Crute, Jr. for several documents in his file.
July 18, 1994--Two (2) of the items in Mr. Crute's request for
information were sent; approval from the National Office on the other
three (3) items was requested.
July 19, 1994--The results of the preliminary inquiry were sent to
the National Office Equal Opportunity Staff for review.
August 9, 1994--The results of the preliminary inquiry were sent
back for recommendations and summary of the events. Ava Marshall, State
Civil Rights Manager, had made recommendations and conclusions,
previously; however, when reviewed by her supervisor, Mr. Reginald
Rountree, she was instructed to remove them.
August 16, 1994--The results of the preliminary inquiry were
resubmitted with recommendations and conclusions to the National Office
Equal Opportunity Staff as requested.
December 21, 1994--Request was received from Philip Southers,
Attorney, OGC, to close their files on Willie L. Crute, Jr.
January 9, 1995--Response from Lloyd A. Jones, State Director, in
reference to the memorandum dated December 21, 1994. Mr. Jones advised
Mr. Southers to keep the files open since Mr. Crute had filed a law
suit against the agency.
October 1, 1995--Farm Service Agency assumed responsibility for the
agricultural credit lending activities.
January 24, 1996--Donald L. Davis, State Executive Director, Farm
Service Agency, wrote to Mr. Crute notifying him they were not aware of
any offer to settle his complaint by the National Office, and offered
him an opportunity to file a Tort Claim if he wanted to do so. Mr. Lee
Marsh, AgCredit Director, sent Mr. Crute a Tort Claim form to complete.
July 1, 1996--The final decision of USDA, signed by Wardell C.
Townsend, Jr., Assistant Secretary for Administration and Designated
Director of Equal Opportunity Officer, on Willie L. Crute, Jr.'s
January 22, 1994 complaint alleging discrimination based on race, found
that discrimination on the basis of race had occurred.
November 26, 1996--Otis Daily, District Director, reported that
through his regular contacts with the Chase City Office and the
District Farm Specialist, he learned Mr. Crute had filed a
discrimination complaint being handled by the State Civil Rights
Manager. He stated that to his knowledge, no contacts were ever made by
him with Mr. Crute.
Chronological History
Eric R. Rice
August 24, 1993--Mr. Eric R. Rice filed a discrimination complaint
based on race against Mr. Charles M. Featherston, County Supervisor,
Brunswick County FmHA Office.
October 19, 1993--Instructions for completing a preliminary inquiry
on Eric R. Rice was sent to the State Director.
April 15, 1994--Jacqui Micheli, Equal Opportunity Specialist,
National Office, Equal Opportunity Staff, mailed Ava Marshall a copy of
the preliminary inquiry report of Eric R. Rice that was done by Pat
Baker, state Civil Rights Coordinator, Delaware. Ms. Baker concluded
from her investigation, the major problem in the Brunswick County
Office was the attitude of the County Supervisor. She stated that, for
many years, the Black farmers felt Mr. Featherstun had total control of
the FmHA office and their applications/benefits. She reported the
processing cards did not show a large discrepancy in processing time;
however, a review of the files did show the servicing attitude which
may have deterred minorities from applying for all benefits/options,
because they felt it would do them no good. Ms. Baker admitted in her
conclusions that since she was from another state, she did not have
enough time to fully complete the review of all items reported by the
Black farmers serviced by this County Office to determine if
differences were made between Black and white farmers in areas of loan
making.
January 3, 1995--Records show that Carrie Schmidt, Acting State
Civil Rights Coordinator, in the absence of Ava Marshall, State Civil
Rights Manager, requested in a letter signed by Lloyd A. Jones, State
Director, to the Maryland/Delaware State Director for his State Civil
Rights Coordinator to assist Virginia on this preliminary inquiry.
These records are very hard to understand because the letter is dated
January 3, 1995, and requesting assistance from the State Civil Rights
Coordinator in Delaware from November 15, 1993, through November 19,
1993. Apparently there was a typographical error in the dates noted.
February 2, 1995--A letter sent from Vicky E. Hunt, Acting Chief,
Program Complaints Adjudication Division, to Cheryl Prejean Greaux,
Director, Equal Opportunity Staff, transmitting a copy of the
Department's final decision on the discrimination complaint of Mr. Eric
R. Rice. Ms. Hunt told Ms. Greaux that she had forwarded her request to
conduct an onsite investigation into the discrimination complaints of
Mr. Rice and other minority farmers in Lawrenceville, Virginia, to the
Evaluation and Investigation Division for appropriate action. Mr.
Rice's complaint from a civil rights standpoint was closed at this
time.
February 10, 1995--A letter from the Department went to Mr. Rice
stating his complaint was not determined to be discrimination based on
race.
April 3, 1995--A letter from Carlton L. Lewis, Branch Chief,
Program Compliance Staff, Civil Rights Division, was sent to Lloyd A.
Jones, State Director, indicating the Department had responded to Mr.
Rice's complaint with a decision that discrimination had not occurred
and the file should be closed.
August 3, 1995--A letter from Mike Espy, Secretary of Agriculture,
was sent to Eric R. Rice asking for additional information to be
provided to continue investigation of his discrimination complaint. He
was given fifteen (15) days to respond to this letter. He was told if
FmHA did not receive the information on his complaint, the case would
be closed. Secretary Espy indicated his files would be returned to the
Virginia FmHA State Director to consider Mr. Rice's application for
debt settlement.
(Note: This file was given to us by Farm Service Agency to
prepare this report and is not complete. We do not have a copy
of the preliminary inquiry, and most of the dates in the
information we have are conflicting throughout the file.)
Chronological History
Sherman D. Witcher
January 25, 1994--Mr. Witcher filed a discrimination complaint
based on age and race.
February 17, 1994--Mr. Witcher's discrimination complaint was sent
to the Equal Opportunity Division in the National Office requesting a
guide for conducting a preliminary inquiry.
March 23, 1994--A letter was sent by Lloyd A. Jones, State
Director, resubmitting copies of the discrimination complaints from
Willie Crute and Sherman Witcher to the National Office Equal
Opportunity Division requesting guides for preliminary inquiry, as it
had been over a month since they were first submitted.
(Note: Recently in November 1996, when we requested the files
on this case from Farm Service Agency, we were told they had
nothing on Sherman Witcher; however, we found the above
information attached to other documents in the files of Willie
L. Crute, also a complainant. We have no idea of whether a
preliminary inquiry or decision was made in this case, or what
the outcome has been since.)
Chronological History
William S. Warren
January 10, 1992--Mr. William S. Warren filed a discrimination
complaint based on race against Ron Norton, County Supervisor,
Southampton FmHA County Office.
February 24, 1992--Lloyd A. Jones. State Director, sent a copy of
the discrimination complaint to the Equal Opportunity Staff.
March 30, 1992--Equal Opportunity Staff sent Lloyd A. Jones a guide
on conducting preliminary inquiry into this complaint.
September 3, 1992--Ava Marshall began working on the preliminary
inquiries as requested by the National Office. Shortly after beginning
work on this preliminary inquiry, Ava Marshall became ill and was out
from work most of early 1993 after being diagnosed with multiple
sclerosis.
July 21, 1993--Mr. Jones. realizing Ms. Marshall was not going to
return anytime soon, requested assistance from the West Virginia State
Civil Rights Coordinator to conduct these preliminary inquiries.
August 23, 1993--Leland Kesner, State Civil Rights Coordinator from
West Virginia, met with Mr. Warren at his home.
November 19, 1993--Mr. Kesner submitted the results to the Equal
Opportunity Staff.
May 13, 1994--A letter was sent from Michael Dunn, Administrator to
Robert Franko recommending that the case be closed from a civil rights
standpoint without further reporting.
March 2, 1995--Congressman Norman Sisisky received a response to
Mr. Warren's inquiry concerning a decision on his discrimination
complaint indicating that Mr. Warren's complaint was being reviewed by
Office of Civil Rights Evaluation (OCRE) and a decision would be made
as quickly as possible. Once a decision was made, Mr. Warren would be
notified directly.
March 2, 1995--Lou Anne Kling, Acting Deputy Administrator, Farm
Credit Programs, again, verified Mr. Warren's claim was still being
reviewed by OCRE. She indicated a decision will be made in the near
future.
(Note: It appears, from the records that we received from
Farm Service Agency, there has been no further action on
discrimination to date.)
Chronological History
Carol Clay
A White Female Borrower
September 8, 1994--A memorandum from Carlton Lewis, Branch Chief,
Program Compliance Staff, Civil Rights Division, to Lloyd A. Jones,
State Director, requesting the State Civil Rights Manager attempt to
conciliate Ms. Clay's complaint or conduct a preliminary inquiry into
the subject's complaint, and provide the National Office, Equal
Opportunity Staff with a copy of the proposed conciliation or the
preliminary report.
May 30, 1995--A memorandum from Cheryl Prejean Greaux to Willie
Cook, an employee on the CFSA Staff, with the original RECD casefile
enclosed. On June 2, 1994, the RECD Equal Opportunity Division
requested the State Director to have his Acting State Civil Rights
Coordinator attempt conciliation, and if conciliation was not
necessary, conduct a preliminary inquiry. A copy of this memorandum re-
notified the Virginia State Director the file was transferred to CFSA.
She pointed out that no further action had been taken by the Equal
Opportunity staff at this time.
August 2, 1995--Lloyd A. Jones, State Director, sent a report to
the National Equal Opportunity Staff on the preliminary inquiry
alleging discrimination by Carol Clay, submitted by Leland Kesner,
State Civil Rights Coordinator, West Virginia.
(Note: No further information is available on the outcome of
this complaint since the file was transferred to FSA. There is
no information in the files giving us the outcome of this
complaint after being sent to the National Office.)
Chronological History
Linwood Brown
July 21, 1994--Mr. Linwood Brown filed a discrimination complaint
against Rose Finch, Acting FmHA County Supervisor in Lawrenceville
County Office.
July 26, 1994--A copy of Mr. Brown's complaint was sent to the
Equal Opportunity Division in Washington, D.C. It was pointed out, at
that time, that this was the second complaint Mr. Brown had filed
against this office and no actions by the Brunswick County Office have
been taken in previous complaints.
(Note: No further in formation is available on this case
since it was submitted to the National Office Equal Opportunity
Staff on July 26, 1994.)
Chronological History
John and Betty Townsend
White Farm Borrowers
This case was closed by the Department on March 13, 1995, in a
letter signed by Jetie B. Wilds, Jr., Deputy Director of Evaluation and
Adjudication on the basis that no discrimination occurred based on
race.
Chronological History
Minority Farmers of Brunswick Country (Lawrenceville, Virginia)
Once I received a copy of the report from the Delaware State Civil
Rights Coordinator, I realized this problem was much more serious than
I anticipated. I discussed my concerns on numerous occasions after a
complete review of complaints my office had received from Brunswick,
Mecklenburg, Lunenburg, Sussex, and Nottoway Counties in Virginia. I
discussed the concerns that I had regarding these issues with the
appropriate National Office officials. I finally submitted a request in
writing on August 2, 1994, for a full and complete investigation
coordinated by the National Office, FmHA, on program delivery, in this
entire area where most of the complaints had originated.
It was my opinion, as State Director, that a more experienced team
in the area of civil rights should have been allowed to look into the
complaints made by Brunswick County farmers alleging discrimination.
The seventeen (17) farmers who were affected by this are:
John Wyatt Julia Seward Robert Seward
Beatrice Rice Walter Rice, Jr. Charles Bland
James Maclin Mary Maclin Laura Rice
Irene Hayes Eric Rice Larry Tucker
James Walker William Royster Leon Wall, Sr.
Linwood Brown Alvin Rice
October 26, 1993--Carrie Schmidt, Acting State Civil Rights
Coordinator, prepared a memorandum for the State Director's signature
indicating the cases evidenced by the December 31, 1992, memorandum had
been resolved. Mrs. Schmidt was very new to the civil rights program
and perhaps did not understand the complexity of these cases.
Specifically, they involved both violations by the County Supervisor in
program areas and civil rights areas. This memorandum was incorrectly
prepared because the action taken on these cases was program related
only. The files on the discrimination complaints should remain open and
the National investigation conducted as recommended.
August 2, 1994--A memorandum was developed and signed by Lloyd A.
Jones, State Director for FmHA, Virginia, requesting a full and
complete investigation of the discrimination complaints filed by the
minority farmers in Brunswick County.
August 29, 1994--A letter was written by Walter Dent, Acting
Director Equal Opportunity Staff, to Robert Franko requesting
assistance on the matter of discrimination on minority farmers and
employees in the Brunswick County area.
September 13, 1994--Robert Franko, Associate Director of Compliance
and Enforcement, responded to Walter Dent on his request to conduct an
onsite investigation on the minority farmers in Lawrenceville,
Virginia, by stating a request had been sent to the Evaluation and
Investigation Division (EID) for review and appropriate action. He
advised Mr. Dent this staff would evaluate all information pertaining
to the subject complaint, and advised the Enforcement Division as to
whether [an] investigation would be scheduled.
July 20, 1996--Thomas Beaumont, Chief, Program Complaints
Adjudication, wrote to Willie D. Cook, Director, Equal Opportunity,
FSA, requesting additional information regarding minority farmers and
employees in the Lawrenceville, Virginia, FmHA office. Mr. Beaumont
advised Mr. Cook FmHA had notified his office that it had conducted an
investigation at the request of several minority farmers and employees
in the Lawrenceville office, found several civil rights violations, and
recommended his office conduct an on site investigation. As of July 20,
1996, no on[s]ite investigation was conducted. He also pointed out that
the memorandum prepared by Mrs. Schmidt was insufficient to close the
cases from a civil rights point. He requested that Mr. Cook advise all
the farmers who made written complaints to advise whether they were
satisfied with the actions taken. Mr. Beaumont indicated, upon receipt
on this information, his office will process these cases.
August 13, 1996--Willie Cook, Director, Equal Opportunity, Farm
Service Agency, wrote to Donald Davis, State Executive Director,
Virginia State FSA Office, asking his staff to contact the following
farmers on their original discrimination complaints:
Linwood Brown Tommie Lowe John Wyatt
Richard Bains James Walker
David and Dorothy Craig Robert Steward
Chronological History
Other Farmers Who Filed Discrimination Complaints With FmHA Whose Civil
Rights Files Could Not Be Found By FSA Since the Reorganization
Lloyd A. Jones, State Director, Rural Development, Virginia, was
unable to obtain civil rights files from Farm Service Agency on the
following borrowers to prepare the chronological history requested.
(See attached list which was the response from FSA).
Alexander and Helen T. Jerome Brown John Wyatt
Warren
Mary Hayes (Daughter of James and Sally Walker John Lipscomb
James Hayes) Larry Tucker Thurman Douglas
Witcher
Calvin Brown Richard Pearson John and Betty
Townsend
William Royster
Executive Summary and Opinion
I take this opportunity to express my concern regarding the plight
of the small and family farm agriculture producers in America and, more
specifically, in the Commonwealth of Virginia. As previously stated, I
have had the opportunity to serve as State Director of the Farmers Home
Administration and Rural Development for approximately 7 years. During
that time, I received numerous complaints as noted above that involved
alleged civil rights violations by employees within USDA and, more
specifically, the Farmers Home Administration. After thoroughly
investigating the cases and obtaining information surrounding the
allegations, I was convinced that the complaints of civil rights
violations did, in fact, have merit and warranted a more intense
investigation by the Office of Civil Rights Enforcement or the
appropriate investigative agency.
In my effort to find the truth to the issues brought to my
attention, I met with several farmers, Black and white, during the
tenure period of March 10, 1990, through September 30, 1995. The result
of my discussions with these farmers consistently and persistently
reaffirmed that there was, in fact, extremely poor customer service
being rendered in the counties of Mecklenburg, Brunswick, Lunenburg,
Nottoway, and Southampton. The names of James Garnett (Mecklenburg),
Charles Featherstun (Brunswick), Waverly Brown (Lunenburg and Nottoway)
and Ron Norton (Southampton), Berry Wright (District Director,
Franklin, VA) and Otis Dailey (District Director, Farmville, Virginia)
all former employees of the Farmers Home Administration were intimately
connected and in fact were viewed by most, if not all, of the
complainants as the problem. Often, I would hear comments to the effect
that these USDA employees did have any concern or compassion for their
plight or sensitivity to their needs. These comments were made by the
complainants noted above as well as others that attempted or were
participating in the USDA programs. The line authority for supervision
of these was as follows:
Lloyd A. Jones, State Director Ron Norton, County Supervisor
Berry Wright, District Director Charles Featherstun, County
Supervisor
Note: Mr. Wright had first line supervisory responsibility
over Mr. Norton and Mr. Featherstun.
Lloyd A. Jones, State Director James Garnett, County Supervisor
Otis Dailey, District Director Waverly Brown, County Supervisor
Note: Mr. Otis Dailey had first line supervisory
responsibility over Mr. Garnett and Mr. Brown.
Please note that Mr. Ron Norton is the only local
and/or district employee that is still employed with
USDA. Mr. Norton presently works for the Farm Service
Agency.
It is my opinion that the poor customer service that I made
reference to above given by these employees was the disguise used to
enforce the entrenched subtle discrimination practices carried out by
them and possibly some of their subordinate employees in administering
USDA programs. I am convinced that discriminatory practices become such
a way of life with some people that it is difficult, if not impossible,
for them to separate right from wrong and cultural acceptance from
blatant double and triple standards for people that are different
because of some physical feature that has nothing to do with the
character of the person or their ability to manage a farming operation.
When I met with these farmers it was evident that they were sincere,
determined, offended, disappointed, honest and, yet, hopeful for
relief.
Because of the cumbersome process that currently exists in the
administrative process of civil rights complaints[,] it became
increasingly clear to me that it was up to me to take administrative
action in resolving the personnel issues in question with regard to
performance of their duties and thereby finding a way to utilize the
skills of these employees in other areas that would maximize there
potential with regard to good customer service. Therefore, some
employees were given the option of accepting reassignment offers or
being released from duty.
It is also clear to me that the need for a strong civil rights
enforcement process is imperative to taking corrective action in
eradicating discriminatory practices in Virginia and throughout this
country. Although I believe [the] vast majority of the USDA workforce
is in fact dedicated to top quality customer service to all, it is also
my belief and confirmation that there are employees that do not have
the understanding and sensitivity that it takes to be a public servant.
I also believe that there are employees who knowingly discriminate
against people who are different from them regardless of the basis of
that difference whether it is based on physical characteristics or
economic conditions. In my effort to carry out an effective outreach
program by working with and through the 1890 Land-Grant Institution in
Virginia, which is Virginia State University, it was still difficult to
gain the full commitment needed from some of the local USDA personnel
in providing the technical assistance in developing and carrying out a
financial and/or business plan that supported the most effective and
efficient use of a customer's resources, particularly for the small
producers. Virginia State University and Farmers Home Administration
worked hand in hand by seeking and obtaining grants to provide the
financial resources for staff personnel that would forge strong
partnerships between USDA, VSU and the end-user of the services that we
provide. Some USDA employees did display the supportive and positive
attitude that was necessary to assist our customers in the most
effective and efficient way possible. In carrying out this initiative
of reaching the small producer with special focus in southside
Virginia, there were approximately 90 farmers that technical assistance
specialists from VSU provided support to small producers with special
emphasis on reaching minority farmers. I also employed a visiting
professor to work for FmHA in assisting farmers with technical support.
Mr. Hermon Macklin was the visiting professor for VSU and FmHA. I have
attached Mr. Macklin's reports for your review also. His report reveals
that there was concern about the small and minority farmer.
I am persuaded by my [own] personal experiences with USDA, as an
employee and a manager, that discrimination does, in fact, exist within
the ranks of this huge department; and having been on the receiving end
of off-color remarks, ethnic jokes, and insensitive behavior towards
minorities and women, it is clear to me that the ``good ol boy'' system
is still a force to be reckoned with even though we are on the verge of
entering the 21st century with new and exciting opportunities that lie
ahead for all of us. Discrimination has no place for any of us now or
in the future; it needs to be eradicated now.
I strongly recommend that these cases of discrimination be settled
as soon as possible and that any idea of reopening the Willie Crute and
John Boyd cases for reinvestigation be quashed. Any effort along those
lines would be a clear indication of double jeopardy for the victims of
discrimination.
My assessment of these issues areas follows:
A. Discrimination has been proven and a reasonable settlement should
proceed with all haste.
B. Civil rights is a people issue and it must be raised to a status
of number one priority. It cannot continue to be an
afterthought for most and no thought at all for far too
many.
C. Diversity in management is critically important in [bringing]
about change in the behavior and attitude of employees at
all levels of the USDA rank file workforce.
D. Minority farmers need an avenue of support through USDA in spite
of traditional policies that were unfriendly to small
producers.
E. The small producer issue and minority farmers must be addressed
in the farm bill now and in the future. This is such a
critical issue because it does in fact lay the footing and
the foundation for agriculture and the small producer for
the future.
F. The 1890 Land-Grant Institutions must become intimate partners
with USDA in our effort to improve our relationship with
minority farmers and to encourage women and minorities to
be willing to pursue production agriculture as a profession
and business that can be viable and support a lifestyle
consistent with that of other professions.
G. Recognize that this a major cultural change for many USDA
employees and attitudes may only be changed when managers
have the authority and flexibility to immediately take
appropriate corrective action with insubordinate and
insensitive behavior.
H. Immediately reevaluate current policy on the collection of farm
accounts to incorporate more flexibility for all rank and
file to assess the needs of each borrower on its on merit
and not allow the customer to be a victim of a ``cookie
cutter'' approach.
I. Immediately consider developing training for all USDA and non
USDA staff that will include cultural diversity,
sensitivity, civil rights and Equal Employment Opportunity,
etc.
In closing, I hope this report has been of some help to you in
gaining at least my perspective of the problems that we had in Virginia
and how we resolved some of those problems. I would be more than happy
to meet with you to discuss any part of this report at your
convenience.
Lloyd A. Jones,
State Director.
[attachments]
Quarterly Report
January, February, March 1994
H.L. Maclin,
Agricultural Management Specialist.
Fifty two (52) one-on-one contacts were made during the last
quarter. Sixty four (64) telephone calls (out going and incoming) were
made or received during the same period. These contacts were in
conjunction with agricultural management and clarification of subject
materials or documents received by borrowers from Farmers Home
Administration (FmHA). In many cases the print on the documents was so
faded out or dull that it was very hard to read much less to
understand. This situation should be corrected in the County
Supervisor's Office.
The request by two delinquent borrowers have been granted. One was
for a loan write-down and buy-out under FmHA instruction 1951-S. The
other was for homestead protection and conveyance of farm property to
U.S. Government.
I have counseled with one determined applicant to no avail. He
wants to over-shadow existing financial responsibilities. Mr. Lipscomb
contacted me at home by telephone. The call lasted over 2 hours! He
feels that he is not being treated fairly by all levels of Farmers Home
Administration. This applicant, according to reports from FmHA, has not
complied with requests for information, and he is determined to go
beyond County, District, and State Administrators in his quest for a
loan.
By request, I spent 1 day with a new SDA borrower (J. Smith) in
Prince Edward County to discuss some enterprise options for a newly
purchased farm financed by Farmers Home Administration. Mr. & Mrs.
Smith are employed full-time, and operate other business enterprises on
the side for additional income. They are young and the parents of one 4
year old. They have established goals and appear to be hard workers and
should be successful in their endeavors. Follow-up counseling is
important to assure that this family understand the justification of
purchasing additional tractor and other machinery. Purchasing another
tractor was one of Mr. Smith's high priorities. At this stage, other
options should be considered before venturing into more indebtedness.
In analyzing the farm situation, pastures need to be improved and
fenced. Once this is done the beef cattle herd should be upgraded and
numbers adjusted according to the number of acres of pasture land
available for grazing. A lot of pine trees were damaged and fallen by
the ice storm last winter. They should be cut and marketed as soon as
possible. Mr. Smith plans are to harvest the damaged timber himself and
market. Maybe this should be his first option.
Theodore Francis, a man involved in a trucking business in North
Carolina, is very anxious to establish a beef cattle herd on his one
hundred and sixty (160) acre farm in Mecklenburg County. He needs
financial assistance to get started with this enterprise. He telephoned
my home to receive information about the FmHA SDA program. A visit was
made to Mr. Francis' farm on Thursday, March 10. The farm has good
potentials for beef cattle or meat goat production. Approximately one
hundred (100) plus acres could be developed for pasture. There is a
watering and fish pond on the farm which would serve as a source of
water for livestock.
I have referred Mr. Francis to our County FmHA Supervisor in Chase
City, Virginia for possible financial assistance. On March 16[,] I
contacted the County FMHA Supervisor in Chase City to provide an
overview of my visit with Mr. Francis. It was indicated that Mr.
Francis had contacted the FmHA Office and a conference date scheduled
for Tuesday, March 22 was verified.
Participated in Farm Management Staff meetings and several county
management workshops. Assisted Farm Management Specialists with FmHA
borrowers and non-borrowers with enterprise record keeping. On March
17, visited five farm families in Southampton County to discuss record
keeping and farm management programs. I have received some feedback
from FmHA County Supervisors commending the work of Farm Management
Specialists on how helpful they have been in developing farm and home
plans for borrowers. Relationship between borrowers and county
supervisors have improved in some counties. There is a better
understanding among borrowers about the overall borrowing and payback
process, what their options are in certain financial circumstances, how
to concur with FmHA requests in many situations, and the need and
advantage of keeping farm records for each enterprise.
I have established a linkage between the FmHA Management Specialist
at Virginia State University and borrowers I have assisted, so as not
to disrupt management assistance in the future.
I have pledged my support to the FmHA Farm Management Project at
Virginia State University, and will continue to support the program and
assist the Management Specialist with the program.
January 26-28[,] I participated in the State Farmer Programs
Training Seminar at the Omni Hotel, Newport News, Virginia. The
presentations were reviews and updates of farmer programs. Emphasis on
Supervisor-Borrower relationship was a fundamental part of the
discussions. It was made clear and understood that FmHA County
Supervisors must have full knowledge of all details involved in FmHA
Farmer Programs before taking any action involving borrowers and loan
applicants. For me, the sessions were another plus to enhance the image
of FmHA Programs.
During the short period of employment by FmHA I wish to say it has
been another learning experience for me. The job was a challenging
endeavor working with rural agricultural families who needed assistance
and appeared to have had an appreciation for the help rendered through
the SDA FmHA Program.
Many thanks to the FmHA State Director for providing this
opportunity for me to serve people in the Commonwealth of Virginia. I
stand by with an open mind to support and assist Farmers Home
Administration whenever called upon in the future.
I wish to extend my appreciation to state and county staff members
who have made my job very satisfying, informative and productive. May
the program efforts continue to enhance the ``Well-Being'' of needy
families.
Thanks to the Director of Virginia Cooperative Extension and staff
for a pleasant, personal environment and working relationship during my
stay at the University. I will invariably remember the many kind and
helpful program suggestions generated by Virginia Cooperative
Extension.
Bi-Monthly Report
November and December, 1993
H.L. Maclin,
Visiting Professor.
Visitation to FmHA County Offices in Farmville, Chase City,
Courtland, and Brunswick to secure SDA updates and general information
related to SDA borrowers. It is encouraging to find improvement in loan
payments and Farm and Home Plans for 1994. FmHA County Supervisors
indicated that the Farm Management Program coming from VSU is having a
tremendous impact on borrowers farming systems. Many borrowers are
beginning to realize the importance of enterprise record keeping. With
the awareness of nonprofit enterprises, borrowers and small farmers
should be able to increase farm profits.
Five socially disadvantaged farmers contacted me concerning the SDA
program. Some are interested in loans to purchase farms, and others are
looking for funds to establish livestock and poultry enterprises. I
visited several of these farmers and frequent contacts were made by
phone to answer questions or provide information relating to the FmHA
program.
Participated in two farm management meetings at VSU on November 30
and December 15. Places visited in conducting the SDA program were
Farmville, Courtland, Cumberland, Chase City, Valentines, Warfield,
Dolphin, Baskerville, and Crewe.
Other activities involved maintaining good public relationships
with Virginia Cooperative Extension and Virginia State University
through participation and involvement in Thanksgiving and Christmas
events on the University campus.
Considerable time was spent with the Farm Management Specialist in
planning FmHA borrowers workshops to be conducted in January and
February of 1994. I took some time out to enjoy the ``Holiday Seasons''
(Thanksgiving and Christmas).
During the next reporting period I am planning to work closely with
farm planning and financial management workshops; also SDA borrowers
Farm and Home Plans.
Will attend and participate in the Farmer Program Training January
26-28, 1994.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Bi-Monthly Report
September & October, 1993
H.L. Maclin,
Visiting Professor
Fourteen visits were made during this reporting period to SDA
borrowers in Greensville, Lunenburg, Mecklenburg, Southampton, and
Brunswick Counties. These visits involved updating correspondence from
FmHA, existing status, future plans, and assistance needed. My findings
were that many borrowers were faced with low crop yields and poor
quality products due to the drought. This situation will lower profits
and farm income resulting in less money to pay financial
responsibilities. Some are looking at alternative enterprises; and
others off-farm employment to supplement farm income. A few are trying
to obtain family support so as to put forth efforts to raise money and
pay off indebtedness. None want to [lose] their farms.
To soften the needs of the SDA borrowers, there are only a few
options based on the current FmHA guidelines. One possibility would be
to set up a farming system, including only enterprises that have been
proven profitable based on the geographic characteristics of the area.
Restructure the loan so that payments will be compatible to the
established farming system. ``Lease-back payback'' is a good option,
but it only applies to those borrowers showing a cash flow. What about
SDA borrowers not showing a ``cash flow'' operation? Can a farming
system be developed based on available resources that will provide
enough farm profit to show cash flow adequate for family living and
positive potential of paying off the loan? These are options that can
be initiated and closely monitored by FmHA.
Representatives from the USDA FmHA-EDS Office in Alexander,
Virginia, I-MO-FU, a co-worker and I visited and interviewed four SDA
farmers in Greensville and Brunswick Counties. The interviews were
centered around FmHA Programs each participated in and how effective
the program was in solving their problems. What were some of their
immediate needs and some of the things they thought might help them.
The ``feed back'' as a result of the visits impressed the USDA visitors
very much according to comments at the end of the day. We also visited
the Brunswick County FmHA Supervisor's office.
Participated in two farm management meetings involving FmHA and CES
Farm Management Specialist at VSU. Assisted two Management Specialists
in Southampton and Mecklenburg Counties with programs dealing with on-
farm family financial management.
Attended and participated in a Research Field Day on October 26 at
VSU's John Randolph Farm, Petersburg, Virginia. Participated in USDA
satellite program September 8 at VSU. Met with the Southside Business/
Education Commission in South Boston on September 14, and in Farmville
September 15. Also on September 15 visited the FmHA office in
Farmville, the Cumberland CES office and FmHA State Office. On
September 24 visited FmHA office in Chase City, and two borrowers in
Mecklenburg County.
On October 19 attended an Open House at the new location of FmHA
and ASCS State Offices in the Culpeper Building, 1606 Santa Rose Road,
Richmond, Virginia.
On November 5 attended a ``Gala Affair'' Agriculture Alumni Banquet
at Virginia State University.
Plans are being formulated for Borrowers Workshops to be conducted
during the months of December '93, January and February '94. Much time
will be devoted working with Management Specialists in planning and
executing these programs. Some time will be spent working one-on-one
with borrowers requesting assistance.
[August 5, 1992]
July Monthly Report (1992)
H.L. Maclin,
Visiting Professor.
On July 8, 1992, I visited the last two 1951-S Socially
Disadvantaged Borrowers assigned by the State Director (Administrative
Notice (AN), Virginia AN No. 540 (1943A) dated December 20, 1991). The
purpose of this AN is to provide guidance for the Visiting Professor in
an effort to improve the assistance provided to the Socially
Disadvantaged Applicants (SDA), particularly those borrowers who are
unable to acquire the educational assistance from other sources to
interpret correspondence received from FmHA.
The Visiting Professor conducted a total of fifteen conferences
with eight SDAs assigned. These SDAs were selected by County FmHA
Supervisors in four counties. The Visiting Professor provided timely
assistance to these borrowers and made sure they understood all
proceedings coming from the FmHA, and their (borrowers)
responsibilities during 1951-S processing. The borrowers were informed
of their rights under FmHA regulations. It is the intent that no
borrower will lose the family farm merely because of lack of
information.
In all cases, borrowers have been very receptive and eager to learn
more about FmHA and their individual situation. Most borrowers realize
their management short-comings, but their financial predicament do not
look encouraging for a future turn-a-round.
On July 8, 1992[,] I visited Sylvester Warren and discussed with
him, his daughter, and son some of his related activities and
proceedings with FmHA. The following information were revealed.
Sylvester Warren age 67, Courtland, Virginia owns approximately 250
acres of farm and timber land. He grows one hundred acres of peanuts.
Of this number, he rents fifty. He also produces two hundred acres of
soybeans[,] fifty acres are grown on his farm and one hundred and fifty
acres are rented. He received [S]ocial [S]ecurity benefits, the sum of
$352.00 monthly. His liabilities from other creditors are Sovern
Peanuts Company $40,000; S.P.A. $40,000; and Southern States
Corporation $2,500. Indebtedness to Farmers Home Administration was not
revealed. He has requested a $14,000 production loan through Farmers
Home Administration for the year 1992. He has not paid FmHA anything in
several years. He is current in payments with other loaning agencies.
In 1991 twenty six thousand dollar worth of hardwood and pine
timber was sold from approximately 100 acres of timberland. Mr. Warren
indicated that he and his family cut the trees and paid a trucker to
haul logs to the market place. He also stated that the County
Supervisor for Farmers Home Administration was aware of the transaction
prior to selling the timber. He had held conferences with the County
Supervisor and told him he wanted to sell the timber to pay some debts.
If this is true, which I have no reason to doubt, the timber was sold
in good faith.
Mr. Warren filed for a crop disaster loan in 1991 with ASCS.
According to statements from Mr. Warren and Vivian (his daughter) with
the right of ``Power Attorney'', the application was misplaced or left
in the office of the ASCS. Since he has refiled for disaster loan with
no avail.
Sylvester Warren is the father of 13 children. Three daughters live
in his household. One works full time off the farm, one is in tracking
partnership business with her brothers, and one helped on the farm. Mr.
Warren's wife expired 2 years ago. His education is limited to the
first grade. He says he knows how to farm because he grew seed peanuts
10 years for a seed company in North Carolina. Mr. Warren has hired an
attorney to handle his business affairs. Telephone [Redated].
On July 8, 1992[,] I held a conference with the wife of Clifton
Slade, Surry, Virginia. She indicated that her husband Clifton had
suffered a stroke and was not able to carry on his farming and other
business activities. His nephew, Glen Slade, conducts the farming
operation on his four hundred acre farm.
Since visiting the Slade Farm, I contacted Mr. Slade by telephone
for additional information. He indicated that his son, Clifton, was
assisting him with his business activities.
I received a telephone call from Mr. Lundy, Chief, Farmer Programs,
to contact Mr. George E. Morris, Borrower, FmHA, Hwy Rt. 3, Lancaster,
Virginia, who had received 1951-S serving actions to give assistance in
filing FmHA package with County Supervisor. George E. Morris was
contacted by telephone to obtain a statement on his situation. He
indicated that he had been misinformed and needed help in dealing with
the problem.
On July 16, 1992, I visited Mr. Morris and held a conference with
him and his wife. They are retired farmers with an indebtedness of
twenty-six hundred dollars ($2,600) owed to FmHA and a four thousand
dollar ($4,000) debt with Northern Neck State Bank, Warsaw, Virginia.
They rent their farm land for twenty nine hundred dollars ($2,900)
annually. Mr. Morris indicated that his son, who lives in the District
of Columbia, helps in financial management of the farm. He had received
a 1951 Service Action Processing package from the County Supervisors
(office at Tappahannock) on June 6, 1992. He asked for assistance in
filing package. (His package was completed to be returned to the
County's FmHA Office.)
Mr. Morris appeared to have been very disoriented over the 1951-
Serving Action process. I indicated to him that he had two options.
One, file the application requesting rescheduling of payments; and,
two, borrow money and pay off the indebtedness.
Having established credit at the local bank. it appeared to be
advantageous for him to borrow the small amount of money ($2,600) owed
FmHA and pay off the loan.
As a follow-up to my visit, Mr. Morris was contacted by telephone
to check on his decision. He thanked me for the visit and the
assistance rendered in guiding him to make the decision to borrow the
money and pay off the FmHA loan. He also stated that if I ran for
President, I would get his vote.
On July 24, 1992, I participated in the Soil Conservation Service
(SCS) tour in Prince Edward County. I had the opportunity to observe a
Dairy Lot Rotational Management System and a Poultry Dead Bird Litter
System. I was particularly interested in the poultry demonstration
because a FmHA borrower is applying for a loan to construct a Dead Bird
Litter System on his poultry farm. ASCS will pay 75% of the cost when
constructed in accordance to specifications.
I visited and discussed the operation of a Poultry Broiler
Enterprise System with borrower Steven Faircloth in Prince Edward
County.
I had a conference with the Chief Farmer Programs and the State
Director on July 27, 1992. Purpose--administrative procedure.
[June 15, 1992]
Virginia State University
P.O. Box 9081
Petersburg, Virginia 23803
June 12, 1992
Dear Friends:
Farm ownership loans for socially disadvantaged persons will be
discussed in the Town Hall Building, Bank Street, Waverly, Virginia on
June 23, 1992, beginning at 7:30 p.m.
The forum will be conducted by Farmers Home Administration's (FmHA)
Management Specialist. Lloyd A. Jones, State Director, FmHA will be our
guest speaker, assisted by Herman Lundy, Chief of Farmer Programs--both
from the FmHA State Office, Richmond, Virginia.
The discussion will be centered on the need, purpose, and benefits
from the SDA program to land owners. There will be 1 hour of allotted
time for group discussion on issues related to Farmer's Home
Administration programs.
We hope you will attend and participate in these activities. This
is your opportunity to meet our State Director and let him know how you
feel about the FmHA Program.
Sincerely,
Hermon Maclin,
Management Specialist FmHA.
Farm Ownership Loans for Disadvantaged Persons
FmHA Forum
June 23, 1992
Town Hall Building
Bank Street
Waverly, Virginia
Agenda
7:00 p.m. Opening Remarks H.L. Maclin
Introduction Speaker Herman Lundy, Chief,
Farmer Programs
Forum Speaker Lloyd Jones, State
Director, FmHA
8:00 p.m. Group Discussion Gladys B. Holland,
Coordinator for
Discussion
9:00 p.m. Closing Comment H.L. Maclin
June 12, 1992 *
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* Editor's note: this dated report was duplicated in the submitted
documents, it is reproduced herein as received.
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Virginia State University
P.O. Box 9081
Petersburg, Virginia 23803
Dear Friends:
Farm ownership loans for socially disadvantaged persons will be
discussed in the Town Hall Building, Bank Street, Waverly, Virginia on
June 23, 1992, beginning at 7:30 p.m.
The forum will be conducted by Farmers Home Administration's (FmHA)
Management Specialist. Lloyd A. Jones, State Director, FmHA will be our
guest speaker, assisted by Herman Lundy, Chief of Farmer Programs--both
from the FmHA State Office, Richmond, Virginia.
The discussion will be centered on the need, purpose, and benefits
from the SDA program to land owners. There will be 1 hour of allotted
time for group discussion on issues related to Farmer's Home
Administration programs.
We hope you will attend and participate in these activities. This
is your opportunity to meet our State Director and let him know how you
feel about the FmHA Program.
Sincerely,
Hermon Maclin,
Management Specialist FmHA.
May Monthly Report (1992)
H.L. Maclin,
Visiting Professor.
On May 7[,] a management conference was held with Linwood Brown at
his home. We discussed his past farming program. We noted low tobacco
yields and poor quality. His hog operation wasn't paying off, he had a
low soybean yield, and he indicated a need for tobacco rotation system.
For the last 40 years tobacco has been planted on the same fields year
after year. He admitted to management problems.
Linwood agreed to cooperate with CES and FmHA in developing a
better crop rotation system and eliminating his hog project. Plans are
being developed to rotate his tobacco crop. Tobacco will be the only
crop he plans to grow in 1992. He planted pine seedlings during the
planting season to supplement his income.
On May 8[,] a visit was made to the farm of Richard Barnes, an SDA
borrower. He grows approximately 4,000 lbs of flue-cured tobacco, 50
acres of peanuts, and 120 acres of soybeans. His liabilities to FmHA is
$140,000. His setback has been due to disaster crop failure over a
period of years without insurance protection. Growing corn was his
greatest crop failure. He has no plans for growing more corn.
In talking with Mr. Barnes, he is behind in planting this year due
to inadequate production money. FmHA has not processed his production
loan (PL) he applied for in October 1991. Richard usually is the first
to plant crops in his community. He is very disturbed over the time it
is taking to process his PL. While visiting him the County Supervisor
telephoned to let him know his application has been processed, and will
be mailed to Richmond on Monday, May 11.
Applying chemicals to the land and planting seeds in the soil on
time, according to recommendations, are very necessary in maximizing
crop yields. Based on the telephone calls I have received this year
from borrowers, there is a need for investigation of loan processing
systems.
Had the opportunity to meet with USDA staff members and Chief of
Farmer Programs on May 13. At this meeting a progress report was made
to inform the staff about some of the program activities conducted
Visited borrower Linwood Brown in Brunswick County to discuss his
farm plan. It was noted that his tobacco crop was looking very good. He
indicated that he needed some more funds to complete his tobacco
fertilizer application program. He seems to have exhausted all sources
for financial assistance to no avail.
I received several telephone calls from borrowers seeking
information on issues affecting their farming business. For some,
referrals were made to the District and State Officers. Others were
handled by visits or telephone.
I have been in close contact with County, District and State
Offices in planning a district meeting for small farmers to be held in
Wakefield Town Hall on June 4 at 7:30 p.m.
On [M]ay 26-28, I was in attendance at State Cooperative Extension
Service Conference in Charlottesville, Virginia. Time permitted me to
discuss rural educational and service programs with members of the CES
staff.
June 12, 1992
Virginia State University
P.O. Box 9081
Petersburg, Virginia 23803
Dear Friends:
Farm ownership loans for socially disadvantaged persons will be
discussed in the Town Hall Building, Bank Street, Waverly, Virginia on
June 23, 1992, beginning at 7:30 p.m.
The forum will be conducted by Farmers Home Administration's (FmHA)
Management Specialist. Lloyd A. Jones, State Director, FmHA will be our
guest speaker, assisted by Herman Lundy, Chief of Farmer Programs--both
from the FmHA State Office, Richmond, Virginia.
The discussion will be centered on the need, purpose, and benefits
from the SDA program to land owners. There will be 1 hour of allotted
time for group discussion on issues related to Farmer's Home
Administration programs.
We hope you will attend and participate in these activities. This
is your opportunity to meet our State Director and let him know how you
feel about the FmHA Program.
Sincerely,
Hermon Maclin,
Management Specialist FmHA.
[May 18, 1992]
May 14, 1992
Mr. Lloyd Jones,
State Director,
Farmers Home Administration,
Richmond, Virginia
Dear Dr. Jones:
In consideration of our telephone conversation on May 4, 1991, our
FmHA staff has scheduled two (2) SDA community meetings. We are happy
and very pleased to know that you will serve as our guest speaker.
The first meeting will be held at Paul D, Camp Community College,
Franklin, Virginia on Tuesday, June 2, 1992, at 7:30 p.m.
The second meeting will be held in The Town Hall Building, Bank
Street, Waverly, Virginia on Thursday, June 4, 1992, beginning at 7:30
p.m.
You are familiar with the profile used in previous meeting you
participated in. The profile will be the same.
Sincerely,
Hermon L. Maclin,
FmHA Visiting Professor.
1992
April Monthly Report
H.L. Maclin,
Visiting Professor.
The month of April began with a trip to Sussex County to visit
farmer Phillip Smith, borrower Fm.H.A. and a socially disadvantaged
person. Phillip was delinquent in 1991 Fm.H.A. payments and was
concerned very much about a production loan applied for in December,
1991. He indicated the ``dire need'' for the loan to get started with
his 1992 farm plan.
Mr. Smith admitted to the management mistakes made in 1991 and what
he plans to do about them in 1992. Too much outside labor was one thing
that cut into profits. Fuel efficiency was another management problem.
His peanut yields were above average. Soybean yields were very low,
basically due to droughty conditions.
Smith feels that he can profit in 1992 by his mistakes in 1991. He
has adequate seed stock for 1992 planting, which will save thousands of
dollars in production cost. He plans to cut labor costs and fuel fifty
percent (50%).
Mr. Smith discovered through the Cooperative Extension Services
Agent that he was wasting money buying fertilizer and lime that the
soil did not need to maximize production. In 1991, fertilizer dealers
tested the soils on his farm and recommended fertilizer and lime
application. For the year 1992, the Cooperative Extension Service Agent
assisted in soil sampling and mailing to laboratory for analysis. Tests
were returned indicating no fertilizer and lime application were needed
for 1992 crop year.
Smith qualified for disaster payments for his soybean crop.
Payments were expected in April, 1992, and will help in overcoming his
crop lost in 1991.
Since my visit with Phillip Smith a production loan has been made
through a local bank.
On April 9, a conference was held with Donnie Whitfield in the
Office of Cooperative Extension Service, Courtland, Virginia. His
primary interest is in farming, although he works a full-time job. He
grew some crops in 1990 on the family farm. He plans to farm part-time
in 1992. He hopes to get a production loan and a (FOL) loan to buy a
farm. Donnie expressed whole-heartedly the desire and love for farming.
He impressed me as a good candidate for a (FOL) Farm Ownership Loan.
Assistance was provided in making application for a production loan for
1992. Other assistance is pending based on locating a desirable farm
for sale.
County Supervisor, Ronald Norton, was visited on the same day to
discuss Donnie Whitfield's situation and the assigned borrower,
Sylvester Warren.
Ron was impressed and highly recommended Donnie as a good potential
borrower.
Sylvester Warren, 1951-S, borrower with liabilities outstanding of
approximately $175,000.00. Fm.H.A. holding second Deed of Trust on
property. Ron asked me to go out and talk with Sylvester to get a
``feel'' of the situation. I will be scheduling a visit in May.
On April 10, held conference with County Supervisor, Waverly Brown,
to get a progress report on Sylvester Holmes, Tommie Graves and Mark
Reese. Tommie Graves is in the process of completing application for a
loan to buy a 47 acre farm. Holmes and Reese are trying to get
commitments from owners of land they wish to purchase. I also had the
opportunity to visit with Mrs. Mark Reese for an update on loan
application. Assisted Mr. and Mrs. George Hendricks in filling out Farm
and Home Plan for 1992.
Attended the State Meeting for Farmers Home Administration, April
13-16, 1992, at the Marriott Motel, Norfolk, Virginia. The program
content was designed to update the staff on administrative changes and
to create a better relationship among Fm.H.A. personnel. Also, to
eliminate existing barriers between borrowers and staff members. In
essence, to improve the overall structure and image of Fm.H.A. from top
to bottom.
Visited James Garnett, County Supervisor, Mecklenburg County on
April 29, 1992. I had a very interesting discussion with Jim concerning
SDA borrowers: David Oliver and John Boyd, both are part-time farmers
working full-time in Northern, Virginia. These borrowers are delinquent
in payments, but (classified as 1951-S) in the last year are making
payments and showing considerable progress.
David Oliver John Boyd is interested in full-time farming. He
discussed his concerns with supervisor and Chief of Farmer Programs.
David John would like to borrow more money to establish a poultry
enterprise and build a dwelling for his family. Fm.H.A. is analyzing
the potentials of the proposal. No decision at the present date.
Alfred King rents a small amount of tobacco. He is a part-time
farmer. He would like to sell his farm to his son, Dennis. If this
business deal can be negotiated it would resolve Alfred's liability to
Fm.H.A.
James and Shirley Small rented and farmed forty (40) acres in 1990,
hoping to purchase the farm in 1991. In 1991, Fm.H.A. made a loan to
the Smalls of $85,000 to purchase the farm. It's a one hundred acre
farm, 4,000 lbs. tobacco and a dwelling.
The County Supervisor, Garnett, would like to visit and introduce
me to these borrowers in May. This should establish a working
relationship between SDA borrowers and the visiting professor.
[April 28, 1992]
First Quarter
Reporting Period
January 1-March 31, 1992
H.L. Maclin,
Visiting Professor.
For the first quarter (1992) a great amount of time was spent
visiting by telephone and person to person contacts with County
Supervisors, Waverly Brown; Wayne Dail; Charles Featherston, and
borrowers located in their jurisdictions. On several occasions
conferences were held with the Chief of Farmer programs and the State
Director Farmers Home Administration to discuss the issues involved in
conducting the Socially Disadvantaged programs and a progress update on
some of the day by day activities. Conferences were held with the staff
members of Cooperative Extension Services to gather pertinent
information on farm enterprise budgets and analysis of farm plans.
Whenever necessary, the visiting professor has served in the capacity
of removing or preventing obstacles that prevented full participation
of those persons in Fm.H.A.'s farm ownership loan program. Have also
provided technical assistance to qualified applicants in applying for
loans and in developing sound farm and home plans essential for
successful farm operation.
L.T. Holmes; Silvester Holmes; Tommie Graves; Mark Reese; and
Charles King; Ron Ellis, potential borrowers, were visited and
contacted by telephone several times to discuss Operating Loans (OL)
and Farm Ownership Loans (FOL) and assisted in developing farm and home
plans.
Ron Ellis, by request from County Supervisor Waverly Brown,
assisted with developing a feasible Farm and Home Plan. Enterprise
options were developed with the cooperation and assistance of Anthony
Hankins, Cooperative Extension Services Specialist Alternative
Enterprises. Ron had developed a loan budget in excess of $200,000. But
in analysis income potentials results showed maximum loan budget of
$52,000. No decision has been made to make application for loan through
Fm.H.A.
Tommie Graves has filed an application for a loan to purchase a
farm. Option papers are being processed. Upon completion, he should
qualify for a (FOL) Farm Ownership Loan.
Mark Reese wishes to make application for a FOL. Application is
being processed.
Mr. Silvester Holmes, a previous borrower of Fm.H.A. is interested
in purchasing adjoining farm consisting of approximately 172 acres.
This farm was used primarily for live-stock production (beef cattle) by
owner. A considerable amount of land is open, consisting of a very good
stand of fescue and grass mixture. No * price has been established for
the property estimated at $65,000-$75,000.
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* Editor's note: the submission included an out of sequence set of
hand-numbered pages (34-36). They have been published in sequence
herein.
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Silvester owns 100+ acres of land. The land is basically pasture
land. He is a beef cattle producer which consist of 30 brood cows and a
[simmental] bull. He has adequate farm equipment for operation and
liability free. The family is in the process of building a new house on
the farm site (pay as you go). At the present time his gross income
from beef cattle ranges from $10,000 to $15,000 annually. His wife
grows tobacco with a gross income of an average $10,000 annually.
Holmes was involved in an auto accident a few years back resulting
in leaving him physically handicapped. He hires a full-time employee.
Holmes manages the farm and performs small farm chores. As soon as the
selling price of the farm (172 acres) can be determined, plans are to
make application for a loan through Fm.H.A.
On January 27, 1992, Vernon Orrell, Farmer Program Specialist,
provided some basic training in working with 1951-S. Servicing Actions
borrowers. To inform some of the right of appeal and other essentials
involved in the process.
State Director, Lloyd A. Jones, requested the visiting professor to
visit county supervisors and assist in communicating with borrowers
receiving 1951-S. Servicing Actions.
Visits and conferences were held with the following County
Supervisors to get an update on borrower assigned. They were:
a. Charles Featherston
b. Waverly Brown
c. Ronald Norton; also Barry Wright
d. George Haskett
e. Wayne Dail, by phone
Charles Featherston, County Supervisor, indicated assistance needed
by the following borrowers:
Richard Barnes (Greenville County)
Grows tobacco and peanuts. Management problem expenses too high for
some reasons. He has reduced the size on acreage but expenses remain
the same. Some question??
Visited Steven Faircloth on March 24, 1992[,] after receiving a
telephone call asking for help in management. Also discussed with Wayne
Dail, County Supervisor, Steven's situation before making the visit.
Steven has taken Chapter 7. He stated that this was a must in order
to clear some of his liabilities. Now he feels secure enough to take
care of responsibilities for his poultry (Broiler) enterprise. He
stated that he was current in his payments to Fm.H.A.
He was desirous of installing nipple drinkers in the poultry house
and building disposal facilities for his chickens. He is filing
application for same with Fm.H.A.
An invitation was extended [to] me to attend the Annual Association
Meeting the evening of March 24, 1992 in Farmville. In discussions with
the Chairman and other members it was indicated that nipple drinkers
and disposal facilities will be required by all poultry producers in
the near future.
Discussed borrower, Steven Faircloth's poultry enterprise with
Wayne Dail. Also, discussed the matter with District Supervisor, Otis
Daily. The option of installing nipple drinkers and disposal facilities
requested by Faircloth will be required by the Tyson Company in the
near future is my understanding.
Participated in a forestry field day and tour sponsored by
Cooperative Extension Service, VSU, March 7, 1992. Served on the
Governor's appointed ``Business/Education Partnership Commission'' for
Southside Virginia, and participated in two membership meetings.
Attended a swine Contract Operational Meeting in Brunswick County
on March 13, 1992 sponsored by Cooperative Extension Services. The
meeting involved Carrolls Foods of Virginia Contract Swine Production,
an agreement between producer (farmer) and Carrolls Foods of Virginia
to grow feeder pigs or/and finished hogs on a percentage contract
basis. The company furnishing animal feed and transportation to
producer and market. The farmer providing the facility, equipment,
labor and management.
Contacted the State Office (Herman Lundy) to inform management
process used by the visiting professor in processing borrowers'
proposals. Managing the potential borrower before loan application,
defining resources, liabilities, income, enterprise, potential and
capabilities of pay back.
Linwood Brown
Crop yield very low (tobacco). Quality of tobacco poor, preparing
for market poor. Swine production average pigs per sow five per year.
He purchases all of his feed. Selling hogs off butchering pole.
Need to improve crop rotation. Tobacco behind tobacco for many
years.
Calvin Brown
Trying to lease farm and buy back. Too much of a gentleman farmer.
Cannot do much without people around.
Frank Webb and Tommy Lowe in a lease back-pay-back situation. Need
assistance in management.
Visited with Mr. Waverly Brown, County Supervisor, to get an update
on the status of George Hendricks, Kenbridge, Virginia. He indicated:
Limited in educational (4th) abilities.
Assistance Needed:
Making farm and home plan
Record keeping (problem area)
Swine Operation (very poor)
Flue-cured tobacco (average)
Visited his farm and planned tentative dates for one-on-one
conference. Also, visited with Mrs. Dorothy Graves in making
application for loan to purchase 47 acre farm.
Visited with borrowers, Calvin Brown; Linwood Brown; George
Hendricks, Jr.[;] and Clifton Slade.
Visited an assigned borrower to update his farm and house plan, and
to pass on a few management practices.
Discussed, by phone, a complaint made by a borrower in Greenville
County (Charles King). The complaint involved an application for a
Fm.H.A. Guaranteed Loan to install an automatic nesting system for
layers (hens). According to King and his wife, the application was
filed in November, 1991. I received the call in March, 1992.
The visiting professor spent considerable time with Waverly Brown,
County Supervisor, in conference with Tommie and Dorothy Graves, and
Mark Reese and his wife. Both families are interested in purchasing
additional land. We also visited Ron Ellis' farm to identify resources.
[March 12, 1992]
March 9, 1992
Mr. Herman Lundy,
Chief, Farmer Programs Division,
Richmond, Virginia
Dear Mr. Lundy,
The enclosed Farm Plan supersedes plan submitted by Mr. Ron Ellis
in January 1992. Specialist Anthony Hankins, (CES) Alternative
Agriculture and I assisted Mr. Ellis in developing a revised plan that
would be feasible and logical to his status.
Mr. Ellis wasn't too pleased over the revised proposal. He plans to
meet with Mr. Waverly Brown, County Supervisor FmHA, Kenbridge,
Virginia to further discuss his intentions.
We feel that fifty one thousands two hundred dollars would be
maximum liability in the case of Mr. Ron Ellis, with this we recommend
off farm employment.
Sincerely,
Hermon L. Maclin,
Visiting Professor.
[Enclosure] *
---------------------------------------------------------------------------
* Editor's note: the submission included an out of sequence set of
hand-numbered pages (51-53). They have been published in sequence
herein.
---------------------------------------------------------------------------
A Farm Loan Application to Establish Commercial Production of Pastured
Poultry on my Farm in Lunenburg County
Submitted to Farmers Home Administration
By: Ronald J. Ellis, 1928 Berkeley Avenue, Petersburg, VA 23805,
Phone--[Redacted]
Introduction
New meat products being sold from several commercial farms in
Virginia come from ``pastured poultry'' in the form of processed
broiler and roaster chickens. ``Pastured poultry'' refers to chickens
that are fed and grown outside within portable pens on clean grass
pastures. Pastured poultry are often also called ``range poultry.''
These poultry products offer consumers an alternative to the broiler
and roaster chickens grown within confinement buildings by farmers
under contract with large vertically-integrated poultry companies. Many
consumers are glad to have an alternative to the poultry products
offered for sale at supermarkets because they have concerns about the
safety of the big brand name poultry products. A great deal of media
attention on the vertically-integrated poultry industry has made
consumers worried about cleanliness, [S]almonella and adulterants.
Consumers have learned that chickens raised within \3/4\\2\ of living
space must be fed high levels of vitamins and antibiotics to grow. They
do not like the images seen on television of the huge automated poultry
processing plants operated by the big companies. Those processing
plants do not appear to be clean and wholesome.
The vertically-integrated poultry companies have recently caused
financial hardship for a number of Virginia farmers. Farmers who borrow
money to build confinement buildings under contract arrangement with
the big companies must face the risk that their company will move
operations away from them at some point in the future. This has
occurred at several locations in Virginia in recent years. The farmer
is left with big buildings, big debts and no markets for any broilers
they may raise.
Pastured poultry are sold at retail prices directly to consumers
and at wholesale prices to restaurants and health food stores. On farm
processing assures cleanliness and same day freshness of all poultry
sold. Pastured birds offer a completely different meat to the consumer
than the big broiler house birds.
The flavor is different. Many restaurant chefs prefer to serve
pastured poultry or ``range poultry'' to their customers because they
believe that the flavor is superior to that of factory floor chickens.
Prices paid for pastured poultry are normally twice as high as prices
paid for regular broilers ($1.00 per lb. versus $.50 per lb.)
Commercial production of pastured poultry has proven to be a
profitable enterprise for family farm operations. The best person to
contact to discuss the viability of this enterprise is Mr. Joel
Salatin, owner of Polyface Farm Inc., near Staunton, Virginia. Mr.
Salatin has been producing and marketing pastured poultry from his farm
since 1965. He developed the flock feeding and management system that
will be used on my farm in Lunenburg County. (see attached Pastured
Poultry Manual).**
---------------------------------------------------------------------------
** Editor's note: the attachment referenced was not included as
part of Mr. Boyd's submission.
---------------------------------------------------------------------------
Mr. Salatin may be reached at [Redacted].
Objectives
To establish commercial production of 20,000 broiler and roaster
chickens annually on my 84.5 acre farm in Lunenburg County.
To process and market 20,000 broiler and roaster chickens annually
from my 84.5 acre farm in Lunenburg County.
Method
In April, May and June of 1992, construct 100 floorless cages 10
by 12 by 2 high.
In July of 1992, construct a brooder house with heat lamps for
raising baby chicks. Upon completion, purchase 11,000 chicks and begin
raising them.
On August 1, 1992, stock 10,000 pullets in the 100 portable pens
and grow them out until mid-October. Market these chickens.
In mid-April of 1993, stock 10,000 pullets in the 100 portable pens
and grow them out until the end of June. Process and market these
chickens.
In early July of 1993, stock 10,000 pullets in the 100 portable
pens and grow them out until October. Process and market these
chickens.
Continue to produce and market two crops of broiler and roaster
chickens each year (20,000 birds).
------------------------------------------------------------------------
Budget 1992
------------------------------------------------------------------------
Portable pen materials............................... $10,000
Purchased feeds...................................... 4,000
Scalders and pickers................................. 2,000
Brooder house materials.............................. 800
Baby chicks (11,000)................................. 2,500
Hired labor.......................................... 2,000
Utilities............................................ 2,000
Transportation....................................... 1,500
------------------
Total costs........................................ $25,000
------------------
Gross income from sale of 10,000 roaster chickens $20,000
==================
Net income for 1992............................ (^$5,600)
------------------------------------------------------------------------
Budget 1993
------------------------------------------------------------------------
Purchased feeds...................................... $9,600
Baby chicks (22,000)................................. 5,000
Hired labor.......................................... 4,000
Utilities............................................ 4,000
Transportation....................................... 3,000
------------------
Total costs........................................ $25,600
------------------
Gross income from sale of 20,000 roaster chickens $40,000
==================
Net income for 1993............................ $14,400
------------------------------------------------------------------------
Loan request from Farmer's Home Administration to $51,200
establish commercial production of pastured poultry
on my farm in Lunenburg County in 1992 and 1993:....
------------------------------------------------------------------------
Semi-Annual Report
July-December 1991
H.L. Maclin,
Visiting Professor
In the first semi-annual report it was clearly stated that the
issues affecting socially disadvantage[d] people were: educational,
financial and managerial which indicate the necessity of a training and
management system in coherence with the financial assistance rendered
to borrowers by Farmers Home Administration. With facts in the proper
prospective our program initiative for the last 6 months were designed
to provide some assistance to SDA and SDP that would enhance
profitability and success. Also the wise choice of owning or purchasing
land whenever feasible.
In an effort to provide assistance to the socially disadvantage[d]
people the visiting professor visited twenty-eight farm families,
telephoned fifty-four people to plan, execute or evaluate the program
and conducted/attended fourteen staff conference. Three multi-county
(SDP) meetings were conducted involving state staff program support.
Approximately sixty-eight people attended these meetings.
For self improvement, attended three agricultural field days,
participated in two training meetings and three State Staff Meetings.
In developing better public relationship the agent serves on the
Virginia Governor's (21 member) Business/Education Partnership
Commission for Southside Virginia. Three meetings were held during this
reporting period, in which the visiting professor attended and
participated. The State Director and Chief of Farmers Program (FmHA)
were personally involved and provided administrative leadership in
administering the program.
Socially Disadvantaged
In analyzing the restraints of the Socially Disadvantaged as to the
successful endeavors undertaken, there is a tremendous need for
training and the basic knowledge for success.
To alleviate and improve upon some of the present borrow[er]
situation, one-on-one contacts by the visiting professor and community
meetings were conducted to establish a relationship between SDA and the
State Administration Lenders. So far three meetings were held involving
Farmers Home Administration personnel. The first meeting was held in
Farmville, Virginia approximately eighteen Socially Disadvantaged
people were in attendance along with the County Supervisor, Wayne Dail.
Representing the State Office were Ada Marshall and Herman Lundy, Chief
of Farmer Programs. A brief overview of the purpose of the meeting was
presented by Wayne Dail, County Supervisor FHA. The stated essence was
to inform and update people on issues affecting the Socially
Disadvantage[d] and Farmers Home Administration. The role of the
visiting professor was described as an active link between the S.D.P.
and the Chief of Farmer Programs and State Director, as to the issues
affecting the Socially Disadvantaged. The Chief of Farmer Programs,
Herman Lundy, outlined and discussed in details the background for the
establishment of funds for farm ownership loans to eligible members of
Socially Disadvantaged groups who will operate family-size farms, and
the benefits anticipated as a result of the program.
The three key points in his discussion, emphasized very clearly by
Mr. Lundy: intent of FmHA:
Make funds and farmland in the possession of FmHA more
available to socially disadvantaged persons.
Discover and remove obstacles that prevent the full
participation of those persons in FmHA farm ownership loan
programs.
Provide necessary technical assistance to qualified
applicants in applying for the loans and in developing the
sound farm management practices essential for success in their
farming operations.
Ada Marshall, Coordinator Civil Rights expressed her concern of
equal treatment for all borrowers and their rights of appeal. Group
discussion followed each presentation. Based on the reaction of the
people information presented was informative and appreciative.
On the evening of October 29, and December 18, 1991 starting at
7:30 p.m. a second and third meeting were held in Brunswick and
Lunenburg for the socially disadvantage[d] people to inform and develop
a closer relationship between the social disadvantaged people and the
State Director, Lloyd Jones, from the point-of-view of FmHA program
design. These meetings were well attended. Representatives from the
State, Lloyd Jones and Herman Lundy; from the District Offices, Berry
Wright and Otis Dailey; representing the Counties Office were
Supervisors Charles Featherstun, Waverly Brown, and Wayne Dail. Dr.
Thomas Law, President, St. Paul's College, Lawrenceville, Virginia,
represented the College's while Gladys Holland, CES VSU, Richard
Booker, Assistant Director, CES VSU and Richard Cagan, CES, CRD VSU
were representatives of Virginia State University, Petersburg, Va.
Herman Lundy, Chief of Farmer Programs described the purpose of the
meetings as a method of establishing better understanding of Farmer
programs and the State Directors's office.
It is very important for State FmHA staff and the socially
disadvantage[d] to be able to relate with each other and discuss issues
involving FmHA and the people directly affected by the program,
concluded Mr. Lundy.
Lloyd Jones, State Director, was the guest speaker at both
meetings. He started off with creating a positive attitude of FmHA by
informing the people of his concerns of issues affecting them and their
concerns were problems that concerns him and the entire staff of
Farmers Home Administration. Mr. Jones discussion was indicative of
bringing the people and the staff of Farmers Home Administration closer
together in dialogue, positive thinking and affirmative action. Mr.
Jones left no doubt in anyone['s] mind of his sincerity in the well
being of the socially disadvantage[d] people. He open the doors to the
State Office in welcoming the people to telephone or visit for a
conference at anytime or whenever an issue can not be resolved on a
county or district level. Jones sensitivity of the people problem
projected over the audience like a beacon light. The people could feel
his concerns and reacted in response.
Mr. Jones was seriously concerned by the [loss] of land by SDP and
the need for more people to re-think their priorities. The meetings
were designed to accommodate a low profile where everybody felt very
much [a part] of the discussion. The discussion periods were extended
beyond allotted time in order to give everybody the opportunity to
participate.
The need for a training system for borrowers and county FmHA board
members were emphasized during the meeting. Farm management and closer
check on SDA resources, capabilities, and past farming history were
mentioned as very important components for successful farming
enterprise.
These meetings provided an opportunity for people to meet the State
Director and ask question[s] concerning FmHA programs. A total of sixty
eight people participated in these meetings conducted by the visiting
professor. These conducted meetings were the beginning of a series of
group meetings planned in the future. We can assume that the results of
these group meetings strongly emphasizes the importance of initiating
educational assistance programs for S.D.P. and FmHA personnel. The need
for Cooperative Extension Service assistance in Farm Management;
Budgeting; Enterprise selections, alternative enterprises; and in
developing a feasible family farm.
The visiting professor attended and participated in a ``Small
Farmer Training Assistance Project Meeting'' in Washington, D.C.,
September 18-20, 1991. Representatives from several states participated
in the program sponsored by the National FmHA Administration Office. An
exchange of ideas and methods used to assist the socially disadvantaged
were presented by organized discussion groups. The meeting resulted in
providing a vast number of approaches to the problems of socially
disadvantage[d] people. Also, provided some successful examples of
assistance to family farmers.
Highlights of Small Farmer Conference--September 18-20, 1991
Washington, D.C.
Overview of Nine States Programs
Effective Teaching, Training and Success
1. One-on-one technical and financial assistance
Technical assistance to include farm, home and goals of
family
Estate planning for Black land loss and property
transfer between gener-
ations and need for wills
FmHA borrowers only to outreach primarily
2. 1890 project Cooperative Extension Program (CESP) staff to attend
FmHA training meetings to remain abreast of changes, issues
and reverse.
3. How to set up SDA project--joint decision within the State
between CEP and FmHA to address the need of State and
county, i.e., technical assistance to FmHA borrowers to
emphasize SDA outreach.
4. How to get farmers more involved--let the farmer pick the time
and place, build around issues or current problems, build
around social activities or groups, i.e., churches, friends
on technical tours (civic organizations and public
assemblies).
5. Develop materials more suitable to that clientele, i.e., FmHA
record book is too difficult choose another, i.e., CES ``
'', recipe budget box.
6. Develop a student program to create positive image for
agriculture High school, 1st grade-up, film on Hi-Tech
harvest, tours to campus, etc.
7. The Council of 1890 Presidents and interested farm groups should
put pressure (lobby) to appropriate the $10M that has been
authorized.
8. Problems if continuity of program is disrupted.
To Assure Delivery of Programs and Training
FmHA should be responsible for adequate ongoing training of SDA
employees:
a. 1890 Institution develop news articles, pamphlets, radio and TV
programs for delivery to target clientele; must be reviewed
and approved by FmHA for technical accuracy prior to
delivery to news media and public.
The 1890 extension personnel working with the SDA Project are
provided orientation training by the 1890 and 1862 Land-
Grant Institutional personnel and FmHA State Office.
During the year follow-up training should be provided by FmHA
and technical subject matter specialists from the Extension
Service.
Cooperative Agreement with 1890--FmHA
1. Model document
good
allows for flexibility
2. Paperwork/Reporting
standardized
minimized
3. Evaluation Criteria
quantifiable and realistic for Part I?
Part II criteria = more important
4. Success/Continuity
If project is successful, funding for following cycle
should be automatic (18
months = relatively short)
1890s' responsibilities for continuity
strengthening 1890s' programs
FmHA Loan Servicing/Processing
FmHA Supervisors should use all available agencies to assist in
coming up with a suitable farm plan. The potential borrower can go to
the Agricultural College, Extension Service, to assist with initial
preparation of a farm plan. FmHA County Supervisors should assist in
imputing data once received from the borrower. County Supervisors must
adhere to the statutory requirement for 30 day and 60 day milestones
for processing and notification of loan applications. A piecemeal
approach on the part of the borrower in disclosing debts and FmHA
notification incomplete request will delay processing.
Assessment of Applicant Potential for Success
Investment--Other resources
Grantee should work with individuals who have a potential for
success. 1890 county extension representatives should screen
applicants, their resources and investments and their capability for
success before bringing them to the FmHA Office. Those who are poor
candidates for success should be told.
The 1890 Institution needs to be an active participant in County,
District and State FAC meetings with other public and private
institutions and entities invited at local level as appropriate.
Continuing Extending Projects To Avoid Breaks in Service
FmHA should:
Invite proposals and extensions in a timely manner with
specific timeframes.
Statement: Need for Cooperatives
1. Small farmers should be encouraged and assisted to assemble
themselves in production units/cooperative in order to meet
market demand, receive greater return on investments, share
cost of cooling, grading, packing and transporting products
to market.
2. USDA should assist cooperatives/production units with mechanism
for financing of processing and marketing facilities by
direct loans if guaranteed loans are unavailable.
3. Hold small farm conference on alternative farm enterprise.
Include representative from successful cooperative
presenters at conference.
In regard to funding for alternative farm enterprise:
a. The Administrator should clarify and strengthen the
policy statement
on financing alternative agriculture enterprise.
Recruiting and Retaining Students
Recruitment can begin with an approach to careers in agriculture
education at an early age, teaching students about the wide array of
jobs related to agriculture.
Retention efforts may be tied to productive internships and
cooperative experiences plus tutorial programs and exposure to other
agency staff as occasional teachers using innovative teaching
techniques and field trips.
All 42 USDA agencies should be involved in recruitment for interns,
cooperative education and other types of employment opportunities at
both high school and college level.
How Can We Get More Dollars for Alternative Enterprises
Involve all agencies to make a complete analysis of farm potential
by looking at alternative enterprises that are profitable. County
Supervisors should provide guidance as well as the Extension Service.
1. Procedures and 1890 representatives need to do a better job of
developing crop budgets, marketing plans and so forth
(financial data).
2. Training FmHA employees on financing alternative crops.
3. Involving lenders (sell alternative crops).
Evaluation Summary Statement
In evaluating the program efforts, one must conclude that the
socially disadvantaged people have been denied opportunities to fully
participate in a bias society. This situation had a degenerating effect
on the economics, educational and social development of socially
disadvantaged people. To the extent of [loss] of land ownership,
economic depression, deprivation of job opportunities and inferior
educational systems.
Land loss among Blacks continue to climb above the average of all
ethnic groups. There are a few purchases but land losses are much
greater than the gains. The trend for Black land ownership look bleak.
Economic change could reverse the land ownership trend among (SDP)
socially disadvantage[d] people. The future will tell.
In conducting program efforts, emphasis on economic development
through better resource management, educational training and self
esteem were priorities in program execution. Group community meetings
one-on-one contacts, mass media, bulletins, letters, telecommunication
and conference were the methods employed to upgrade socially
disadvantaged people.
Although the program initiatives had some impact on the well being
of (SDP) socially disadvantage[d] people there still remains a wide
economic and social gap between ethnic groups in the state of Virginia.
[December 13, 1991]
Virginia State University
P.O. Box 540
Petersburg, Virginia 23803
9 December 1991
Dear Friends:
Farm ownership loans for socially disadvantaged persons will be
discussed in the Agriculture Service Building, 116 Commerce Street,
Kenbridge, Virginia on December 18, beginning at 7:00 p.m.
The forum will be conducted by Farmers Home Administration's
Management Specialist. Lloyd A. Jones, State Director, FmHA, will be
our guest speaker, assisted by Herman Lundy, Chief of Farmer Programs--
both from the FmHA State Office, Richmond, Virginia.
The discussion will be centered on the need, purpose, and benefits
from the SDA program to land owners. There will be 1 hour of allotted
time for group discussion on issues related to Farmers Home
Administration programs.
We hope you will attend and participate in these activities. This
is your opportunity to meet our State Director and let him know how you
feel about the FmHA Program.
Sincerely,
Hermon Maclin,
Management Specialist, FmHA
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
[October 17, 1991]
Virginia State University
P.O. Box 540
Petersburg, Virginia 23803
16 October 1991
Dear Friends:
Farm ownership loans for socially disadvantaged persons will be
discussed on October 29 beginning at 7:00 p.m. in the Government
Building located on Tobacco Street, Lawrenceville, Virginia.
The forum will be conducted by Farmers Home Administration's
Management Specialist. Lloyd A. Jones, State Director, FmHA, will be
our guest speaker, assisted by Herman Lundy, Chief of Farmer Programs--
both from the FmHA State Office, Richmond, Virginia.
The discussion will be centered on the need, purpose, and benefits
from the SDA program to land owners. There will be 1 hour of allotted
time for group discussion on issues related to Farmers Home
Administration programs.
We hope you will attend and participate in these activities. This
is your opportunity to meet our State Director and let him know how you
feel about the FmHA Program.
Sincerely,
Hermon Maclin,
Management Specialist, FmHA
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
[July 16, 1991]
Semi-Annual Report
Farmers Home Administration
Virginia State University
Petersburg, Virginia
June 30, 1991
Hermon L. Maclin,
(Visiting Professor).
The visiting professor serves as an adviser to the State Director
in matters concerning Black-owned farms and other socially
disadvantaged borrowers. Efforts are made to enhance management of
socially disadvantaged farm families and to establish a closer rapport
with Virginia State University.
In an effort to focus attention on objectives of the Socially
Disadvantaged Program, the visiting professor performed a varied number
of activities. Seventy eight (78) days were spent during the months of
January through June 1991 conducting the program.
Special emphasis was placed on locating and assisting socially
disadvantaged families who may qualify for FmHA assistance; to inform
and advise the general public and special interest groups about
available FmHA agricultural assistance; to identify resources available
to SDA; and to make recommendations for alternative farm enterprises
which would enhance profitability.
Socially Disadvantaged Program (SDA) objectives were presented to
members of the NAACP in Brunswick and Mecklenburg Counties. Programs
were duplicated, in Charlotte and Halifax Counties, February 20 and 28
respectively to members of the County Assembly. Total attendance at the
meetings was 140. A workshop was conducted in Farmville, Va on March
20, 1991.
Approximately 15 people attended this activity in the ASCS
Conference Room. The Chief, Farmer Programs and the Civil Rights
Coordinator made presentations. Mr. Herman Lundy, Chief, Farmer
Programs, outlined the procedures and requirements for obtaining SDA
loans, what is required from the borrowers and what to expect from
Farmers Home Administration (FmHA). Ms. Ava Marshall, Civil Rights
Coordinator expressed her concern about equality of treatment for all
borrowers as provided by the Civil Rights Act, and your right to
participate.
The duties of the visiting professor and the program objectives
were defined in common terms to clarify some of the terminology. For
example there were questions concerning the eligibility for a SDA loan.
Can an individual receive a loan on the basis of sufficient education
or training without having farming experience (within 1 year of the
last 5)? This question needs further clarification so as to leave no
doubt in anyone's mind on the matter of qualification for borrowers.
Wayne Dail, County Supervisor, FmHA, extended an invitation and
encouraged borrowers to visit his office for assistance at anytime.
Cooperative Extension Service (CES) was represented at the meeting by
Kylor Reed, Agent, and Warren Scott, Technician. The participants
expressed their appreciation for receiving a better understanding of
the SDA and FmHA at-large program.
Six visits were made to discuss the SDA Program with FmHA
Supervisors in Halifax, Lunenburg, Prince Edward, Southampton,
Brunswick and Mecklenburg Counties. A list of SDA borrowers were
provided by the County Supervisors that perhaps would need some
managerial help. Conferences were conducted with Cooperative Extension
Service in Dinwiddie, Greenville, Southampton, Brunswick, Lunenburg,
Nottoway, Sussex, Surry and Amelia Counties. Each Cooperative Extension
Service unit was provided with [an] overview of the FmHA SDA programs
and was asked as an educational source to inform the public.
Twenty on-farm visits were made during the work period. Discussions
involved crops to plant for profit, non-profitable crops for the
farming area, and general management practices. On several occasions
visits were made to inform the borrowers about the SDA programs.
Approximately 100 telephone calls were received and made to discuss
program objectives, planning activities, scheduling appointments, and
responding to request. Many conferences were held with the Chief,
Farmer Programs (Herman Lundy); staff members Gladys Holland, Joel
Plath, and CES Director Dr. Lorenza Lyons and Vice President Dr.
Clinton Turner.
At the request of Ben Lee, Vocational Agricultural Instructor,
Southampton County a ``pep'' talk was given to 18 high school students
enrolled in vocational agriculture at the Southampton High School,
Courtland, Virginia. The discussion involved the importance of securing
a good education for personal satisfaction or self-esteem, for public
service, economic future, better livelihood, a resource for better
community development, and the ``Well Being of the Family.'' Outlined
career opportunities in areas of agriculture and related occupations,
and what is required in order to compete with the ``working world?''
Closing remarks were centered around the agricultural program at
Virginia State University and would like for each class member to
consider attending The State Land-Grant University.
A very small number of people attending the group meetings were
engaged in farming. Nevertheless, the people were interested in knowing
more about the FmHA programs for the benefit of informing others who
may need the service. Several farmers indicated their desire for
further contacts with the representatives from the FmHA. The names,
addresses and telephone numbers are a part of our files at VSU for the
purpose of future contacts.
The on-farm visits with borrowers indicates a need for better farm
records. Record books are provided but very few farm enterprise records
are kept. This creates a problem when time comes for farm planning.
There is no way of pin-pointing profitable farm enterprises without
records of the past farming year. Although there are crop and livestock
budgets available each farming operation is different. So the average
budget in many cases are not applicable. Many farm operations need
assistance in decision making. If the operation is without any records
of the last years cropping system, it is hard for operators or
management specialist to make the right decision for the current year.
A farm management specialist knowing the land capabilities for the
State of Virginia could inform the farm operator what to expect in
return from each enterprise.
Judging from observation, capital investment is one of the major
causes for the situation borrowers are confronted with today. A large
number of borrowers have purchased additional tractors for certain jobs
only, to avoid the time it takes to change equipment. The same job in
many instances, can be done with one tractor. This management system
cuts profits and should be closely monitored.
Traditional farming is one of the major obstacles of many socially
disadvantaged farm families today. Growing a set number of acres of
grain, so many acres of hay, etc., because of tradition, can be costly
to the farming operation. The cropping system should be designed to
fill the needs of the operators and at the same time show a profit. For
an example, corn cannot be grown in South Central Virginia for a profit
based on current prices. The cost input per acre for corn on the
average is about $240.00. Average corn prices paid to producers amount
$2.40. A very few farmers will average 100 bushels of corn per acre. At
$2.40 per bushel this is only the ``break-even point.'' For assurance
reasons only, corn production in a livestock operation may be
justified.
There are other farm enterprises that should be eliminated in
farming situations in order to establish a profitable unit. These
factors must be taken into consideration when we establish farm plans
for borrowers. Cooperative Extension Service and CSRS at Virginia State
University have established farm enterprises designed for small
farmers. Some of these enterprises could be profitable for some
borrowers.
The socially disadvantaged borrowers are confronted with many
management problems. A large number were ``share croppers'' before
becoming borrowers and potential owners. They are confronted with new
horizons--decision making. Quite often, the wrong decision is made,
resulting in poor farm management. Perhaps this could have been
prevented through some form of educational channel. Maybe a farm
management backup system. During the several conferences with FmHA
County Supervisors, it was indicated that the socially disadvantaged
borrowers needed more assistance in management and that the existing
condition of FmHA (S-51) could have been because of poor supervision.
Many socially disadvantaged borrowers become wors[e] off
financially as a result of borrowing money and over-extending their
capabilities to manage their farming operation than they were before
making the loan. When this type of situation occurs the relationship
between the borrowers and Farmers Home Administration changes from a
positive attitude to a negative attitude. In this state of affairs the
image of the loaning agency culminates into a very undesirable state of
being. To prevent or reduce to the minimum discontent between both
parties, perhaps an analysis of the past records should be made to
determine what went wrong; based on findings establish guidelines and
procedures that will better fit the needs of SDAs and not their
destitutions.
Socially disadvantaged people will continue to be victims of
landownership losses unless something can be done to instill in the
minds of young people that ``owning land is a precious heritage and
without it, there is no legal independency to live on.''
Most of our professionals in teaching positions have taught our
youth to endeavor in careers other than agriculture. This in many
respects, have dampened the minds of young people and their
appreciation for land ownership. Blacks who lived on and farmed the
land operated with limited resources. This created hardship for many
Black families causing many family members to leave the farm and the
land with no intention of returning; nor maintaining family ownership.
Blacks who worked as share-croppers worked hard, but owned nothing.
They were poorly educated and whenever the opportunity presented itself
they would migrate to cities with an attitude of hate for land.
Recommendation
In order to be more serviceable in making loans to the socially
disadvantaged clientele, FmHA should take a closer look at guidelines
in determining eligibility for socially disadvantaged applicants. For
example, potential borrowers with farming experience or training in
agriculture should be considered not on the basis of having farmed 1
year of the last 5, but on the basis of farming experience,
agricultural training, managerial ability, available resources and
other human traits important to successful business endeavors.
SDA needs more on-farm management assistance during the production
of farm enterprises. Perhaps more when the borrower has farmed as a
tenant, when all farm management decisions were made daily by the
landowner. Being accustomed to executing decisions and not making any,
puts the borrower in a situation where management becomes a new chore
that is difficult to cope with, from the standpoint of making the right
decision. A farm management specialist could assist these borrowers
whenever these problems occur.
A closer check on farm machinery, equipment and buildings should be
done to ascertain proper maintenance. Through my observation some
borrower's roofs on buildings are falling in because of negligence.
Machinery is improperly housed and in need of repairs.
Farm enterprise recordkeeping should be enhanced and put on the
priority list of demands. Maybe the official FmHA record book should be
revised to better fit the requirements and at the same time much easier
for the borrower to record farm transactions. More emphasis and time
should be considered in writing individual farm plans. No two farming
situations are alike. This being true, all precautions should be used
in choosing farm enterprises adaptable to the operator and show
profitability.
It is believed that much more can be done to help borrowers who are
in default and classified as FmHA 51-S. There is a need for a
comprehensive program to study the situation and other factors
responsible for a large number of socially disadvantaged borrowers who
are victims.
Based on the list of borrowers received from Farmers Home
Administration County Supervisors, it was indicated that over fifty
percent of the socially disadvantaged borrowers were classified as FmHA
51-S--Default in payments. With this type of situation involving most
of the Counties it is a possibility that socially disadvantaged farmers
will continue to lose land and capital at an increasing rate. On the
other hand, the initiation of an educational enhancement program and
establishing some new initiatives will perhaps slow down the present
trend.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Rise Up--Celebrate Our Successes
1991 Conference of Extension Professional Associations
May 28-30, Lynchburg Radisson
Tuesday 7-9:00 p.m. Board meetings (if
needed)
Wednesday, May 29 7-9 a.m. Early arrival
refreshments
hospitality room
8:00 Registration, Hotel
lobby
9:00 Benefits Update, Kenneth
Martin--Ballroom
9:50 Break
10:10 Association Committee
Meetings
11:00 VESA State Committee
Meetings
11:00 Professional Improvement
Seminars (3)
11:45 Buffet Luncheon hosted
by VESA and ``Special''
after lunch program for
all attending
1:30 p.m. Professional Improvement
Seminars (2)
1:30 VAE4-HA Annual Meeting
2:30 Refreshment break
2:50 Epsilon Sigma Phi Annual
Meeting
3:00 Professional Improvement
Seminar for Agents with
less than 5 years
service and Agents not
E.S.P. members. ``Jest
For The Fun Of It''
sponsored by VESA
4:15 DSA Awards Presentation
sponsored by VAEHE. All
conference participants
please attend!
6:00 Country Dinner sponsored
by VAEHE
7:30 Board Meetings (if
needed)
7:30 Social sponsored by
VAEHE
Thursday, May 30 8:00 a.m. VAAEA and VAEHE Annual
Meetings
8:30 Professional Improvement
Seminar, VAE4-HA
10:00 Refreshment Break
10:20 VESA Annual Meeting
11:45 Hotel check-out
12:15 Awards Luncheon hosted
by Epsilon Sigma Phi
2:00 Conference evaluation
and comment
2:15 Association Board
Meetings
2:30 VESA Board Meeting
3:00 Have a safe trip home!
Committee lists and detailed meeting locations will be in
your packet upon arrival. Country Dinner location will be announced
via electronic mail 1 to 2 weeks prior to the conference.
The elements of the program are listed as of 2/15/91 and
may be subject to slight changes. Contact Gene Daniel in
Gloucester, EXO73, if you have a problem or question prior to
registration.
No registration needed for P.I. seminars. First come . . .
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Farmers Home Administration
Progress Report--August and September, 1990
Visiting Professor (Management Specialist)
The Socially Disadvantaged Program (SDP) effort in conjunction with
Virginia State University, involving Cooperative Extension Service
(CES) as liaison to the program, is being administered in twelve
counties. One staff meeting was held with the Director of CES and the
Associate Vice President for Agriculture and Extension to discuss on-
going activities. Seven conferences were held with CES agents in
Sussex, Southampton, Cumberland, Prince Edward, Charles City, and
Brunswick. These conferences were designed to enhance the program
objectives. Three staff meetings and several telephone conferences were
held with Chief Farmer Programs Director, and one with the State
Director, Farmers Home Administration, and Chief Farmer Programs
Director for the purpose of program evaluation and recommendations.
Visited four (4) farm families who were interested in SDA program
loans.
The Visiting Professor worked thirty three (33) days conducting
educational presentations at group meetings held by Civic
Organizations, NAACP Chapters, Churches, and Farmers Home
Administration Districts. Conferences were held with County (Fm.H.A.)
Supervisors in Charles City, Brunswick, Mecklenburg, Prince Edward,
Cumberland, Greensville, Lunenburg, and Franklin (special assignment)
Counties.
In the office, research was conducted on Farmers Home
Administration procedures and policies. Also did some research on Black
Demographics. Weekly conferences were held with CES staff associated
with Fm.H.A. programs to coordinate efforts, exchange ideas,
activities, and accomplishments. Telephone calls were made to schedule
group meetings, staff conferences, and one-on-one farm visits.
During group meetings in Prince Edward County a number of questions
were asked about Fm.H.A. policies and County Supervisor. Some felt that
they were not treated fairly on several occasions. Others discussed the
hassle they were confronted with along with too much ``red tape''. A
list of names interested in buying land was provided for loan
consideration. In churches the ministers requested an area meeting for
the benefit of several counties to discuss farm ownership loans for
socially disadvantaged persons. Based on conferences with a number of
CES staff members and Fm.H.A. County Supervisors, there need to be some
changes in policies and guidelines if we are to help the SDP in
Virginia.
In summary and evaluation there are indications that more and more
SDAs are [losing] land than ones gaining land. Socially Disadvantaged
People are eager to purchase or maintain their farms. Yet in many
instances, financial difficulties have prevented them from doing
either. A large number need to be taught management skills once they
become borrowers.
Maybe the existing situation is due to over-priced appraisals at
the initial phase of the borrower's purchase. Allowing loans for the
purchase of excess machinery, equipment, and supplies (chemicals, etc.)
are other symptoms of financial disaster. A majority of borrowers were
faced with the problem of making management decisions. They have the
technique and ability to perform the farm chores, but they lack the
ability of deciding what to do when. This is the result of being a
share-cropper where the landlord made the decisions and the cropper did
the work. When Fm.H.A. grants a loan to a tenant farmer to purchase a
farm and operate same, he is being placed in a somewhat different
situation. He has to make the decisions and perform the farming
activities. Making the wrong decision has been the failure of many
borrowers.
Approximately six hundred (600) people have been contacted in group
meetings, churches, NAACP meetings, farm visits, and by telephone.
During the state of being in communication with people, program
initiatives were outlined and questions answered according to
established guidelines. A list of NAACP State Chapter Presidents, and
meeting dates have been obtained.
In response to program efforts, sixteen (16) telephone calls were
received requesting more information. In the designated counties, seven
conferences were held with County Farmers Home Administration
Supervisors. By special request, conferences and visits to SD Borrowers
were made in September. To date there are six socially disadvantaged
people who are potential land buyers who plan to make applications for
Fm.H.A. loans.
Based on past experience, knowledge of the Fm.H.A., S.D.A.'s
situation, policies and guidelines of Farmers Home Administration and
the brief period of direct exposure to the system, I am recommending
for consideration the following:
Establish different guidelines for the Socially
Disadvantaged Applicants (S.D.A.)
Provide for on-farm management for borrowers (Farm
Management Specialist)
a. Cost of capital (land, equipment) is not in access of market
value.
b. Variable cost of production per acre is complementary to
area.
c. Crop enterprises selected on the basis of land capabilities
and use. (Livestock and poultry if feasible.)
Define justifiable machinery and equipment needed for
maximizing farm profits. (Too many ``borrowers'' can't justify
equipment.)
Keep a closer check on maintenance (machinery, buildings,
equipment).
Require complete recordkeeping for each enterprise (to
determine profitability).
Organize a special program to rescue 51-S borrowers (a large
number of SDA's fall in this category).
Change guidelines for foreclosure borrowers (more family
participation, if agreed upon).
Farmers Home Administration
Management Specialist
(Visiting Professor)
Farm Family Information Sheet
Name____________________________________________________________________
________________
Address_________________________________________________________________
_________________
________________________________________________________________________
_________________
Telephone
Number_________________________________________________________________
______
Family Family Age of
Size________________ Health_____________ Operator____________
Formal
Education______________________________________________________________
__________
Type of
Farm___________________________________________________________________
_________
Number of Open Farm
Acres____________ Land________________________________________
Pasture Forest
Acres_____________ Land________________
Timber_________________ Cutover_______________
__ _____
Homestead
Acres__________________________________________________________________
_______
Farming Experience (Number of
Years)____________________________________________________
Organization
Affiliation(s)_________________________________________________________
________
Farming--Part- Or Full-
Time______________________________________ Time_______________
Workforce (Number) Hired_________________
Family_______________________________ _____
Crops
Grown__________________________________________________________________
___________
________________________________________________________________________
_________________
Livestock Raised
(Number):
Cattle_________________ Swine__________________ Other_________________
____ ___ ____
Poultry (Number):
Kind__________________
___
Children In:
4-H High College_______________
Clubs_______________ School________________ _____
_
Program Participation (County, State,
National)____________________________________________
________________________________________________________________________
_________________
CES____________________ FmHA___________________ S.C.S.________________
_ __ _____
ASCS___________________ Other_________________
___ ____
Management Problems:
1.______________________________________________________________________
_________________
2.______________________________________________________________________
_________________
3.______________________________________________________________________
_________________
4.______________________________________________________________________
_________________
5.______________________________________________________________________
_________________
Credit Available:
1.______________________________________________________________________
_________________
2.______________________________________________________________________
_________________
3.______________________________________________________________________
_________________
Credit Needs To Be Used For:
1. Farm
Operations_____________________________________________________________
__________
2. Real Indebtedness___________ Purchases_____________
Estate______________ _____ _____
3. Others: (List Below)
________________________________________________________________________
_________________
________________________________________________________________________
_________________
Management Specialist Comments:
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
July 1990
Farmers Home Administration
Progress Report
Management Specialist
H.L. Maclin
(Visiting Professor)
The agent (representative) spent a large amount of time studying
Farmers Home Administration Policies and Guidelines. Orientation was
accomplished through staff meetings and staff member conferences.
We have collected a list of socially disadvantaged applicants
(SDAs) from Brunswick and Greensville Counties. So far three on-farm
contacts have been made to discuss the management system. The SDA's
present farm management system will be the main component in making
recommendation for change in the farming and administrative systems.
A list of community organizations have been obtained from the
``Target Counties''. From this list, three program presentations were
made in July.
Dialogue between the agent and from Fm.H.A., County, and District
Supervisors have been encouraging. The agent has received several calls
from prospective clients for more information about the SDA program
activities.
Overall the program is challenging. It gives the agent an
opportunity to ``pick-up-on'' and analyze some of the major issues
confronting the socially disadvantaged applicants.
A Farm Family Information Sheet was prepared to be used when
interviewing SDAs (copy enclosed). When completed, it will provide some
basic information.
Visiting Professors Program
July 8, 1983
Purpose: To establish closer rapport with the 1890 institutions.
During the first year, this summer, the visiting professor will study
agency programs and operations to determine methods for improving
Black-owned farms in Alabama through greater understanding and
adaptation of financial programs available through the Farmers Home
Administration.
Authorization: Un-numbered memorandum, dated May 22, 1983, directed
selected states to employ visiting professors from 1890 Land-Grant
Institutions. Alice Oakley Byrd of EEO Staff, National Office, has
advised that Alabama should limit hiring to one professor from either
Alabama A&M or Tuskegee Institute.
Employment Data: Appointment is under Schedule A--noncompetitive.
Salary will depend on qualifications of selected professor; GS-11
($11.78 per hour) or GS-12 ($14.12 per hour). The appointment is
limited to 130 working days per year. Tour of duty may be full-time or
part-time (interpreted as 130 part or whole days). Duty hours can be
changed from month-to-month, but there must be definite duty hours and
a duty station.
Applicants: Three (3) professors have expressed interest in the
Visiting Professors Program and have been scheduled to be interviewed
for the position allocated to Alabama this year. They are:
1.* Dr. Joseph Befecudu (pronounced Befecartre)--Department of Agri-
Business--Alabama A&M. Appointment: 9:00 a.m., July 15,
1983.
2.* Dr. Jones, Department of Agri-Business, Alabama A&M.
Appointment: 9:00 a.m., July 15, 1983
3. Professor Voncile Hale--Tuskegee Institute Appointment: 3:00
p.m., July 14, 1983
* The above professors will be accompanied by Dr. Preyer who
is the Dean of the Agri-Business Department at Alabama A&M. Dr.
Preyer would like to meet the State Director.
Contact at Alabama A&M:
Dr. Aytch (pronounced H)
Telephone 859-7302
Agricultural Mgmt. Specialist
GS-475-12
A. Introduction
This position is located in the Farmers Home Administration,
District Office. The incumbent of this position serves as an advisor to
the State Director in matters concerning Black-owned farms. The
incumbent will strive to improve operation of the Black-owned farms and
will strive to establish a closer rapport with the 1890 Land-Grant
Institutions.
B. Major Duties and Responsibilities
Explores alternatives and prepares analytical materials and
collects documentation necessary for final action by State
Director.
Identifies and evaluates options to increase income on small
farm operations and identifies and evaluates current enterprise
combinations and practices utilized by small farm operators.
Determines the level of knowledge and utilization of
services of selected public and private farm-related
organizations and attitudes toward use of these services by
small farmers.
Identifies resources--their availability and accessibility
to small farmers.
Conducts studies to determine the extent off-farm income
among small farmers that contributes to the total family income
and farming operations.
Evaluates and describes marketing channels utilized by small
farm operators and reports to State Director facts found.
Analyzes field program activity reports to determine trends
or detect weaknesses and recommends measures or prepares
materials to remedy conditions noted and informs State Director
of same.
Informs and advises the general public and special interest
groups about available agricultural and other rural credit
assistance.
Formulates the quality and level of available labor and the
timing of off-farm employment on the selection of farming
enterprises.
Prepares reports and submits to State Director on items such
as:
1. Recommend program changes or new programs which would
accomplish the
objective of saving the Black-owned farm.
2. Identify steps which could be taken to reduce the loss of
Black-owned farms
under existing FmHA and other USDA programs.
3. Compare the loss of Black farmers to the situation in other
states with sig-
nificant Black population and Black ownership of farms.
4. Investigate and analyze the farming operations of Black-owned
farms in Alabama.
Factor 1. Knowledge Required of the Position
Position requires a comprehensive knowledge of problems related to
farming practices in the rural areas. Must have a basic knowledge of
FmHA program objectives, regulations, and policies, and an
understanding of financial practices, tax laws, and legal structures,
and the state and local realty laws. Must have the ability to evaluate
and analyze techniques to effectively assess small farming operations.
Factor 2. Supervisory Controls
Incumbent works under the general supervision of the State
Director, working closely with other State Office program officials and
direct day-to-day supervision of the District Director. The employee is
assigned duties in terms of objectives, general ground rules, but must
plan and carry out specific duties on personal initiative. The broad
scope of duties requires an ability to determine the proper priority of
each of the tasks to be performed. Because of constant travel and type
of work to be done, supervision is extremely limited.
Factor 3. Guidelines
Guidelines in the form of FmHA Instruction and policy are available
(also assistance of District Director or other FmHA employees), but
considerable judgment is required in applying them to a variety of
financial entities--no two of which are comparable--involving loans for
farming. Follows National and State Office administration and
management instructions in assessing rural needs and operations and
regulating corrective procedures.
Factor 4. Complexity
Complexity of this position rests with developing program
objectives, and for exercising broad program evaluation. Extensive
coordination and joint planning contacts with other governmental
agencies and public groups to develop program activities are required.
Factor 5. Scope and Effect
Programs administered involve the physical and economic well being
of a substantial population of the small community and rural segment of
the State.
Factor 6. Personal Contacts
Contacts are with borrowers, prospective borrowers, attorneys,
representatives of other lending organizations, and with management
officials of Farmers Home Administration, etc.
Factor 7. Purpose of Contacts
Contacts are for the purpose of amassing data and/or explaining
program requirements; to assess rural needs, to report deficiencies or
problems encountered; and to ascertain or give information concerning
FmHA function.
Factor 8. Physical Demands
The work requires some physical exertion; walking over uneven,
rough, maybe rocky surfaces, but mostly work can be accomplished in an
office setting. No special physical demands are required to do the job.
Factor 9.
The work environment involves everyday risks or discomforts which
require normal safety precautions typical of such places as office,
meeting rooms, and residences or commercial vehicles. The office area
is adequately lighted, heated, and ventilated.
Fact Sheet
Visiting Professors Program
In our letter to Tuskegee and Alabama A&M we stated that the
visiting professor would report on ``methods to improve Black-operated
farms and increase survival of Black-owned farms in Alabama through
greater understanding and adaptation of the financial programs
available through the Farmers Home Administration''.
To prepare such a report we would expect the individual employed to
work as follows:
1. Thoroughly research FmHA farm programs and procedures in order to
obtain an in-depth understanding of the Agency's farm
programs.
2. To investigate and analyze the farming operations of Black-owned
farms in Alabama.
3. Compare the loss of Black farmers in Alabama to the situation in
other states with significant Black population and Black
ownership of farms.
4. Identify steps which could be taken to reduce the loss of Black-
owned farms in Alabama under existing FmHA and other USDA
programs.
5. Recommend program changes or new programs which would accomplish
the objective of saving the Black-owned farm.
Note
The visiting professor program is not a contract program
requiring a specific product. The visiting professor will be an
employee of the Farmers Home Administration under the general
supervision of the State Director and immediate supervision of
the District Director in the duty station area. As an employee
the visiting professor will be expected to report to his or her
duty station and work toward the above objectives which my be
expanded or refined during the terms of employment.
George S. Kennard,
Administrative Officer.
July 14, 1983
[December 19, 1983]
Subject: Reaffirmation and Survey of FmHA's Visiting Professor's
Program
To: State Directors, FmHA *
---------------------------------------------------------------------------
* Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky,
Louisiana, Mississippi, Missouri, North Carolina, Oklahoma, South
Carolina, Tennessee, Texas, and Virginia
On May 23, 1983, in response to President Reagan's Executive Order
12320 instructing Federal Agencies to increase the percentage share of
program funds allocated to Historically Black Colleges and
Universities, I issued a memorandum establishing a program for the
participation of 1890 Land-Grant Institutions in FmHA-sponsored
programs. Our first effort in this regard was to implement a visiting
professor's program in selected States by seeking to employ an 1890
institution faculty member commencing with the summer of 1983. I wish
to reaffirm this effort.
We need to continue our commitment to the visiting professor's
program. Our objectives, as described in my memorandum of May 23, 1983,
will not be attained with last summer's effort alone. Our effort last
summer was merely the first step in reaching our objectives, not the
program's beginning and end. In this regard, some States--inadvertently
misinterpreting the scope of the program--limited their effort to the
summer months of 1983. What we are striving to accomplish, however, is
a dynamic and substantive program continuing from year-to-year on a
year-long basis having mutual benefit to FmHA and the institutions
because of our close rapport and improved relationship. Our visiting
professor's program, therefore, is a continuing effort, and you should
gauge your involvement in the program with the broader scope in mind.
A survey of States, taken in the second week of November, revealed
that only one State had a visiting professor on its employment roles.
There were four States, however, which were making plans to hire a
professor during the school year 1983-84. The remaining 10 States had
appointed no visiting professor, and moreover, their intentions were
unclear at the time of the survey. I therefore urge those States having
employment plans to follow through with them, and those States having
no activity to initiate contact with the 1890 institutions without
delay. A sample position description, which you should tailor to your
State, is attached to facilitate the hiring process. For additional
assistance, you may get in touch with Steve Klink, National Office
Personnel Division on FTS-382-1071.
Further, we have learned that success with these institutions is
more likely to occur when the dean of agriculture is the person in the
institution who is contacted. This approach is recommended, even though
the attachment to my memorandum of May 23, 1983, lists the names and
addresses of the Presidents of the 1890 institutions.
[December 15, 1983]
Subject: Support of Historically Black Colleges and Universities--
Community Facilities
To: State Directors, FmHA: AL, AR, DE, FL, GA, KY, LA, MD, MA, MS,
MO, NC, OH, OK, PA, SC, TN, TX, VA, WV
This is a follow-up to two previous memoranda concerning Farmers
Home Administration's (FmHA) commitment to implement the President's EO
12320, supporting Historically Black Colleges and Universities (HBCU).
In response to EO 12320, I established a program for the participation
of HBCU's in FmHA programs.
My memorandum of May 11, 1983, requested each State Director to
submit a report on actions taken to implement the FmHA policy regarding
HBCU's. As of this date we have not received all of the reports. Please
review your records and promptly submit your report if you have not
done so.
All of the listed HBCU's in your State should have been contacted.
If the HBCU's have not been contacted plans should be made to do so. It
may be appropriate to schedule a follow-up on previously contacted
HBCU's.
It is important that you express FmHA's sincere desire to assist
the HBCU's in any manner possible consistent with our program
regulations. It is imperative that in your contacts the appropriate
officials are made aware of FmHA programs. The Deans or Chairpersons of
the various departments as well as Board members and Presidents should
be furnished information that explains FmHA programs.
We must continue our commitment to the policy as exemplified in EO
12320. Our efforts to date have only been the beginning of a continuing
emphasis. We are striving to develop a dynamic, substantive, ongoing
program that will have mutual benefit to the HBCU's and FmHA. Your
support and actions are vital and I am sure that your contribution will
be substantial.
Charles W. Shuman,
Administrator.
Visiting Professor Program
I. Hiring Authority
A. One temporary part-time employee
B. Period is for 1 year
C. Workday equivalent--120 days
D. Salary--$30,549 annually (Full-Time Figure) paid bi-weekly
E. Headquartered at Petersburg County Office
F. Appointment non-competitive
II. Work Requirements
A. Major Duties and Responsibilities (Exhibit A)
B. Normal weekly Tour of Duty will be Monday thru Friday, 8:00 a.m.
to 4:30 p.m.
C. Exception will be made for specific scheduling of Night Meetings
as well as weekend meetings with farmers.
D. Specific duties will be assigned upon entrance on duty.
III. Job Criteria
A. Employed by an 1890 Land-Grant Institution
B. Teaching experience in Agriculture. Preference given to Agri-
Business and Agri-Finance.
C. Must acquire basic knowledge of FmHA program objectives,
regulations and policies.
D. Understanding of financial practices, tax laws, legal structure,
realty laws and record keeping.
IV. Supervisory Controls
A. General supervision of State Director.
B. Day-to-day supervision of District Director.
V. Resources for Job Performance
A. Essential supplies available in headquarters office.
B. Telephone service
C. Travel
1. Reimbursement at rate of 20.5 per mile
2. Use of GSA vehicle
3. Overnight per diem reimbursement
VI. Previous Contact With VSU
A. April 1983 with Dr. B.B. Archer--School of Agriculture
B. February 7, 1984 with Dr. Archer
C. Letter dated February 23, 1984 (Exhibit B)
VII. Specific Duties
A. Thoroughly research FmHA farm programs and procedures in order to
obtain an in-depth understanding of the Agency.
B. To investigate and analyze the farming operations of Black owned
farms in Virginia.
C. Compare the loss of Black farmers in Virginia to other states
with significant Black population and ownership of farms.
D. Identify steps which could be taken to reduce the loss of Black
owned farms in Virginia under existing FmHA and other USDA
programs.
E. Determine the extent that Limited Resource Loans are made by FmHA
to deter the loss of Black farm ownership.
F. Recommend program changes or new programs which would accomplish
the objective of saving Black owned farms.
Agricultural Mgmt. Specialist
GS-475-12
A. Introduction
This position is located in the Farmers Home Administration,
District Office. The incumbent of this position serves as an advisor to
the State Director in matters concerning Black-owned farms. The
incumbent will strive to improve operation of the Black-owned farms and
will strive to establish a closer rapport with the 1890 Land-Grant
Institutions.
B. Major Duties and Responsibilities
Explores alternatives and prepares analytical materials and
collects documentation necessary for final action by State
Director.
Identifies and evaluates options to increase income on small
farm operations and identifies and evaluates current enterprise
combinations and practices utilized by small farm operators.
Determines the level of knowledge and utilization of
services of selected public and private farm-related
organizations and attitudes toward use of these services by
small farmers.
Identifies resources--their availability and accessibility
to small farmers.
Conducts studies to determine the extent off-farm income
among small farmers that contributes to the total family income
and farming operations.
Evaluates and describes marketing channels utilized by small
farm operators and reports to State Director facts found.
Analyzes field program activity reports to determine trends
or detect weaknesses and recommends measures or prepares
materials to remedy conditions noted and informs State Director
of same.
Informs and advises the general public and special interest
groups about available agricultural and other rural credit
assistance.
Formulates the quality and level of available labor and the
timing of off-farm employment on the selection of farming
enterprises.
Prepares reports and submits to State Director on items such
as:
1. Recommend program changes or new programs which would
accomplish the
objective of saving the Black-owned farm.
2. Identify steps which could be taken to reduce the loss of
Black-owned farms
under existing FmHA and other USDA programs.
3. Compare the loss of Black farmers to the situation in other
states with sig-
nificant Black population and Black ownership of farms.
4. Investigate and analyze the farming operations of Black-owned
farms in Virginia.
Factor 1. Knowledge Required of the Position
Position requires a comprehensive knowledge of problems related to
farming practices in the rural areas. Must have or obtain a basic
knowledge of FmHA program objectives, regulations, and policies, and an
understanding of financial practices, tax laws, and legal structures,
and the state and local realty laws. Must have the ability to evaluate
and analyze techniques to effectively assess small farming operations.
Factor 2. Supervisory Controls
Incumbent works under the general supervision of the State
Director, working closely with other State Office program officials and
day-to-day supervision of the District Director. The employee is
assigned duties in terms of objectives, general ground rules, but must
plan and carry out specific duties on personal initiative. The broad
scope of duties requires an ability to determine the proper priority of
each of the tasks to be performed. Because of constant travel and type
of work to be done, supervision is extremely limited.
Factor 3. Guidelines
Guidelines in the form of FmHA Instruction and policy are available
(also assistance of District Director or other FmHA employees), but
considerable judgment is required in applying them to a variety of
financial entities--no two of which are comparable--involving loans for
farming. Follows National and State Office administration and
management instructions in assessing rural needs and operations and
regulating corrective procedures.
Factor 4. Complexity
Complexity of this position rests with developing program
objectives, and for exercising broad program evaluation. Extensive
coordination and joint planning contacts with other governmental
agencies and public groups to develop program activities are required.
Factor 5. Scope and Effect
Programs administered involve the physical and economic well being
of a substantial population of the small community and rural segment of
the State.
Factor 6. Personal Contacts
Contacts are with borrowers, prospective borrowers, attorneys,
representatives of other lending organizations, and with management
officials of Farmers Home Administration, etc.
Factor 7. Purpose of Contacts
Contacts are for the purpose of amassing data and/or explaining
program requirements; to assess rural needs, to report deficiencies or
problems encountered; and to ascertain or give information concerning
FmHA function.
Factor 8. Physical Demands
The work requires some physical exertion; walking over uneven,
rough, maybe rocky surfaces, but mostly work can be accomplished in an
office setting. No special physical demands are required to do the job.
Factor 9.
The work environment involves everyday risks or discomforts which
require normal safety precautions typical of such places as office,
meeting rooms, and residences or commercial vehicles. The office area
is adequately lighted, heated, and ventilated.
February 23, 1984
Dr. B.B. Archer,
Dean, School of Agriculture & Applied Sciences,
Virginia State University,
Petersburg, Virginia
Dear Dr. Archer:
I have been advised that you met with Mr. Herman Lundy, Farmer
Programs Specialist of my staff on Tuesday, February 7, 1984 to discuss
President Reagan's Executive Order #12320 instructing Federal Agencies
to increase the percentage share of program funds allocated to
Historically Black Colleges and Universities. As a result of this
order, the administrator of our agency subsequently established the
visiting Professor's Program of which we are very much interested. We
highly appreciate your interest in this program and encourage your
school to participate. Mr. Lundy is currently working on the expected
major duties and responsibilities for this job position. As soon as
this is completed, we will be interested in employing on a temporary
part-time basis one of your professors.
Please continue to consider our program in search for a professor
with a strong agricultural background that could spend a few hours on a
weekly basis to serve us in an advisory capacity. Mr. Lundy will be
contacting you on a regular basis to carry out our employment goal.
If you have questions or comments concerning this, please feel free
to contact Herman directly at [Redacted].
Sincerley yours,
Roie M. Godsey,
State Director.
CC:
Dr. Willbert Greenfield
Mr. Steve Klink
Submission No. 4
United States Department of Agriculture
Settlement Agreement
Discrimination Complaint of John W. Boyd, Jr.
This settlement agreement is made by and between the complainant,
John W. Boyd, Jr., and the United States Department of Agriculture
(``USDA''). This agreement constitutes a full, complete, and final
settlement of all claims for relief in connection with the complaint of
racial discrimination submitted by the complainant on February 18,
1992, and USDA's final decision on such complaint dated October 11,
1996, (attached to this agreement)).
I. USDA agrees to:
1. Pay the complainant the sum of [Redacted] in compensatory
damages. A
check in this amount payable to the complainant and
Clarence N. Jenkins,
Jr., Esq., will be issued as soon as practicable but no
later than 60 days
after this agreement has been signed by all parties.
2. Pay any and all of John W. Boyd, Jr.'s unpaid outstanding debt
owed to the
Farm Service Agency, former Farmers Home Administration,
and the Rural
Housing Service. USDA, the Farm Service Agency, and Rural
Housing
Service, will forever discharge, hold harmless, and
indemnify John W. Boyd,
Jr. from any liability for such debt.
II. Complainant agrees to:
1. Accept the above payment of compensatory damages, and debt
forgiveness
as a full, final, and complete settlement of all claims
in connection with his
February 18, 1992, discrimination complaint and USDA's
final decision
dated October 11, 1996.
2. Waive and release any and all claims or complaints of any kind
arising out
of the events that were the subject of the complainant's
February 18, 1992,
discrimination complaint and USDA's final decision dated
October 11, 1996,
against USDA, the United States of America, and any other
agency of the
United States of America, or any officer, employee, or
agent of the United
States of America, in either his or her official or
individual capacity.
III. Both parties agree that the fact that this complaint was
resolved by this agreement may be disclosed by either party
to any person not a party. However, except as otherwise
required by law, terms of this agreement set out in
paragraphs I and II will not be disclosed by either party,
without the consent of the other party, to any person not a
party except as necessary for that person to perform his
official governmental duties.
Ira L. Hobbs, 5/20/97
Director, Office of Operations, Date
United States Department of Agriculture
John W. Boyd, Jr., 5/20/97
Complainant Date
Clarence N. Jenkins, Jr., 5/20/97
Attorney for the Complainant Date
Submission No. 5
United States Department of Agriculture
Office of Civil Rights
Statute of Limitations
Program Complaint Division
Complainant: John W. Boyd, Jr., [Redacted], Baskerville, VA,
[Redacted]
Representative: Darlene Smith, [Redacted]
County: Mecklenburg County, Virginia
Docket Number: 27
Basis: Race (Black) and Age (24)
Issue(s): Treatment and denial of loan
Agency(ies): Farm Service Agency (FSA), Rural Housing Service (RS)
Date of Complaint: April 20, 1990
Summary of Facts
Letter from John Boyd to Otis Daily, FSA District Director, dated
April 20, 1990 stated he was a 24 year old African-American male that
had been discriminated against by James Garnett, FSA County Supervisor.
Boyd stated that the previous week before the dated letter. Garnett
threw his applications for a home repair loan and farm ownership loan
(300 acres and nursery swine operation) into the trash can and told him
that was too much operation for a boy his age. Boyd also stated that
Garnett told him to apply for government subsidized housing in South
Hill, Virginia because it would be cheaper than making repairs to his
old house.
Ava Marshall, RHS employee in the Virginia State Office who
initially investigated Boyd's discrimination complaint made the
following statements via telephone on July 14, 1999 at 10:00 a.m.:
Marshall stated that Boyd had filed his complaint timely and had
continued to complain about discrimination by Garnett. Marshall stated
that Boyd filed a complaint and made mention of the fact that he had
been complaining with no result. Marshall stated Boyd had kept a copy
of the letter that he had given Daily pertaining to the way Garnett had
treated him. Marshall stated while conducting the investigation she
found out that Daily had the complaint that Boyd had filed, but failed
to forward the complaint to the state office. Marshall stated the
complaints were treated as one, not two complaints.
Boyd stated he had made numerous telephone calls to the Chief of
Programs Complaints Adjudication Division about his two complaints and
had not received any response (referenced from letter on file, dated
Sep1ember 16. 1996).
There were no copies of the 1990 loan request in the file and the
agencies were not able to provide any explanation (referenced from the
Background of the complainant).
Garnett stated he did not get paid to do outreach, he got paid to
make loans and that's was what be did. Garnett also stated that there
were not many minority farmers, because agriculture does not appeal to
them; and that they were mainly looking for a job with a pay check
every Friday (referenced from statement Garnett provided during the
investigation).
Four out of five Black farmers interviewed stated that the county
supervisor was biased to Blacks (referenced from interviews of Black
farmers during the investigation).
On February 18, 1993 the State Civil Right's Coordinator found that
the County Supervisor had a bias toward Blacks (referenced from the
Chronology of Events--John W. Boyd, Jr.).
Garnett was asked to accept an early retirement rather than be
disciplined for his failure to promote EO activities and the fact that
other similar discrimination cases had been discovered in the County
Office (referenced from the summary of file review).
The Farm Program Chief determined Boyd's case had not been properly
handled (referenced from Exhibit G of a loan review report conducted by
the Chief of Farm Program).
County Supervisor documented information pertaining to Boyd
obtaining a Carroll's Food Contract (referenced from a field visit
report conducted by the county supervisor).
Reference List *
---------------------------------------------------------------------------
* Editor's note: the entries that are italicized were not included
in the submission received from Mr. Boyd. The document has reproduced
herein as received.
---------------------------------------------------------------------------
John W. Boyd, Jr.
Statute of Limitations
Docket Number 27
1 Letter from complainant, dated April 20, 1990 establishing
date of complaint
2 Letter from complainant, dated September 16, [1]996
inquiring about two complaints
3 Background of complaint
4 Statement of County Supervisor, Garnett
5 Interviews of Black farmers conducted during the
investigation
6 Chronology of Events--John W. Boyd, Jr.
7 Summary of file review
8 Exhibit G of a loan review report conducted by the Chief of
Farm Programs
9 Field visit report conducted by the county supervisor
X Denotes the applicable section of the referenced document.
Submission No. 6
February 27, 2019
U.S. Department of Agriculture
Attention: Deputy Assistant Secretary Naomi Earp
Office of the Assistant Secretary for Civil Rights
Washington, DC
RE: Formal Complaint of Discrimination Based on African American Race
Dear Ms. Earp:
I am writing an official letter of complaint in response to the
failure of the United States Department of Agriculture (USDA) to comply
with the terms of debt forgiveness as stated in my USDA Settlement
Agreement dated May 20, 1997 which was approved and signed by Ira
Hobbs, Director, Office of Operations, United States Department of
Agriculture; John W. Boyd, Jr., Complainant and Clarence Jenkins,
Attorney for the Complainant.
On February 25, 2019, I received an email from Mrs. Ruby L. Martin
at Hawthorne & Hawthorne Law Firm detailing numerous current USDA liens
filed against me and my farm property. She stated that all USDA liens
would need to be paid and removed prior to my March 22, 2019 closing
date to purchase a $3,000,000 farm in Mecklenburg County, VA. On
February 27, 2019, I visited the Mecklenburg County USDA Service Center
in Boydton, VA. My wife Kara D. Boyd and I met with Evan Harver in the
USDA Farm Service Agency (FSA) Loan Office as evidenced by my receipt
of service. Mr. Harver researched my farm loan files and in those files
he found six (6) Certificates of Satisfaction pertaining to USDA liens
that had been prepared but never signed, dated, notarized and/or filed
by USDA with the Clerk of Court, Mecklenburg County, Virginia. I
believe those certificates were prepared in 1997 in accordance to the
aforementioned USDA Settlement Agreement based upon the fact all the
certificates have the identical language as follows: ``AUTHORIZED FSA
OFFICIAL (Note Holder) ANNE J. RICKMAN, Agriculture Credit Manager'',
``Subscribed, sworn to and acknowledged before me by Anne J. Rickman
this ___ day of _______, 1997.'' and ``My commission expires: 5/31/
1998.'' In addition, the USDA failed to provide a farm in inventory as
stipulated in my USDA Statue of Limitations Agreement.
I believe that this is a clear case of retaliation, breach of
agreement and racial discrimination against an African American farmer
for the following reasons:
1. My racial discrimination complaint and case against the USDA was
one of the 1st in US History. At that time many of the
African American and other minority farmers' racial
discrimination cases were barred by the two (2) year statue
of limitations. Also during that time there was not
functioning USDA Office of Civil Rights. I advocated in
Congress for the position--Assistant Secretary Office of
Civil Rights. I worked to put those things in place.
2. I led the fight for African American Farmers as well as helped
with Native American, Women and Hispanic farmers'
complaints and cases of racial discrimination filed against
USDA.
3. On Dec. 8, 2010, President Obama signed into law a bill that I
authored paving the way for the largest civil rights
settlement in history for African Americans $1.25 Billion.
Now 22 years later (1997-2019), I have been notified of the liens
the USDA failed to remove as stipulated in Section II paragraph 2 of
the aforementioned USDA Settlement Agreement.
I am requesting an immediate investigation and speedy resolution in
this matter. Thank you in advance for your assistance.
Sincerely,
John W. Boyd, Jr.
Submission No. 7
Submission No. 8
------------------------------------------------------------------------
United States Department of Agriculture, Office of the Assistant
Secretary for Civil Rights
------------------------------------------------------------------------
John W. Boyd, Jr.,
Complainant
v. Program Complaint No.: FSA-19-8204
Sonny Perdue,
Secretary,
Department of Agriculture
Agency
Final Agency Decision on Allegations of Noncompliance
I. Introduction
Pursuant to the Alternative Dispute Resolution Act of 1996 (Public
Law 104-320), and the United States Department of Agriculture (USDA)
implementing regulation, Departmental Regulation (DR) 4330-003,\1\ the
Office of the Assistant Secretary for Civil Rights (OASCR) hereby
renders the following determination on the Complainant's allegation of
noncompliance with his Settlement Agreement (SA) dated November 19,
1999.
---------------------------------------------------------------------------
\1\ DR 4330-003, paragraphs 7(j) and 7(j)(2) states that OASCR is
responsible for monitoring implementation of SAs and ensuring
compliance with their terms and conditions. If the complainant believes
that an agency has failed to comply with the terms of the SA, the
complainant shall notify OASCR, in writing, of the alleged
noncompliance within 30 days of when the complainant knew or should
have known of the alleged non-compliance.
---------------------------------------------------------------------------
II. Issue Presented
Whether Farm Service Agency (FSA) officials violated the SA when
they failed to provide Complainant a farm in USDA inventory property
from July 18, 2018 to February 1, 2019.
III. Procedural History
Date of Settlement Agreement: November 19, 1999
Date(s) of Alleged Noncompliance: July 18, 2018-February 1, 2019
Date of Complaint: February 27, 2019
Date of Acceptance: April 15, 2019
Dates of Investigation: July 29, 2019-August 1, 2019
Date of Report of Investigation: October 9, 2019
IV. Statement of Facts
The USDA Rural Development/Farm Services Agency (USDA-RD/FSA)
resale web site provides current information about single-family homes,
multifamily homes, farms, and ranches for sale by the U.S. Federal
Government. The website was designed to provide information regarding
properties owned by the government for public sale. These previously
owned properties are for sale by public auction or other method
depending on the property. The properties are located throughout the
United States including our Commonwealths and Territories in the
Pacific and the Caribbean. After finding a USDA-RD/FSA home or farm
property of interest on the resale web site, individuals are to contact
their local RD or FSA servicing office to obtain the most current and
accurate information regarding the status of the home/farm property,
and to determine eligibility for potential program benefits. Depending
on individual's circumstances and the status of the property listed,
the method of bidding and ultimate purchase of property may vary.\2\
---------------------------------------------------------------------------
\2\ For more information about USDA-RD/FSA properties, see: https:/
/properties.sc.egov.usda.gov/resales/public/home.
---------------------------------------------------------------------------
Complainant resides in and is a farmer in Mecklenburg County,
Virginia. Since 1984, Complainant has participated in FSA's Farm Loan
Programs and has been approved for and received farm ownership and
operating loans. A review of Complainant's complaint history shows, he
has filed several program discrimination complaints related to his FSA
loans over the years, which eventually resulted in two Settlement
Agreements (SA) which were executed on May 20, 1997, and November 19,
1999. (ROI, pg. 5)
On November 19, 1999, Complainant and USDA entered into a SA based
on all claims of Complainant's 1990 discrimination complaints.\3\ The
SA required USDA provide Complainant with priority consideration, on a
one-time basis for the purchase, lease, or other acquisition of
inventory property located in the Commonwealth of Virginia. The SA also
stated Complainant must exercise his right to such priority
consideration in writing and within 5 years of the date the SA was
signed. (ROI, pgs. 214-216)
---------------------------------------------------------------------------
\3\ Due to age, we do not have access to Complainant's complaints
filed in the 1990's against USDA.
---------------------------------------------------------------------------
On July 18, 2018, Complainant emailed the Farm Loan Manager (FLM)
(race: White) in FSA's Siskiyou County, California office, requesting
additional information on a property listed on FSA's inventory property
website. (ROI, pg. 326)
On July 24, 2018, the FLM responded to Complainant's email inquiry
with a phone call. During the call, the FLM provided Complainant with
general information on the property in Lassen County, California and a
general outline of the sale process. Also, the FLM added Complainant's
name and email address to the distribution list to ensure he received
the notice of sale of property once it was published. (ROI, pgs. 325,
306-307)
On the same day, Complainant emailed the FLM requesting physical
address and name of previous owner for the California property he was
interested in. (ROI, pg. 324)
On July 27, 2018, the FLM responded to Complainant's email by
stating she did not have access to a physical address. The FLM
recommended Complainant contact the County Assessor. Also, the FLM
expressed she would try and find out information and let Complainant
know if she could locate the physical address. (ROI, pg. 324)
On February 26, 2019, Complainant visited the Mecklenburg County
FSA office and received assistance from the Farm Loan Officer (FLO) on
outstanding Farmers Home Administration liens on his properties. (ROI,
pgs. 239-240)
On February 27, 2019, Complainant filed a program discrimination
complaint against FSA.\4\ (ROI, pgs. 13-17)
---------------------------------------------------------------------------
\4\ Complaint # 19-8204.
---------------------------------------------------------------------------
On March 11, 2019, Complainant emailed the FLM to see if she had
found any additional information regarding the property of interest.
(ROI, pg. 323)
On August 25, 2019, Complainant emailed the FLM again to see if she
had found any additional information regarding the property of
interest. (ROI, pg. 331)
On September 6, 2019, the FLM responded to Complainant's email by
informing him that property he was interested in was still in the FSA
inventory. According to the FLM, FSA was still working through the
steps to prepare the property for sale as a surplus property. (ROI, pg.
323)
V. Applicable Legal Standards
A settlement agreement is a contract, and its construction is a
question of law. See Lary v. U.S. Postal Serv., 472 F.3d 1363, 1367
(Fed. Cir. 2006). As such, the formation, construction, and
enforceability of a settlement agreement are governed by contract law.
Carr v. Runyan, 89 F.3d 327, 331 (7th Cir. 1996). Therefore, in order
for a complainant to prevail, he/she must show material noncompliance
with the terms of the settlement agreement. See Gilbert v. Dep't of
Justice, 334 F.3d 1065, 1071 (Fed. Cir. 2003) (``A party breaches a
contract when it is in material noncompliance with the terms of the
contract.'')
``A breach is material when it relates to a matter of vital
importance, or goes to the essence of the contract.'' Thomas v. Dep't
of Housing & Urban Dev., 124 F.3d 1439, 1442 (Fed. Cir. 1997);
Restatement (2d) of Contracts 241 (1981) (A material breach is one
that will, or may, defeat the object or underlying purpose of the
contract.). A purely technical and immaterial breach of a contractual
obligation will generally be insufficient to warrant contract
rescission. See, e.g., Sahadi v. Continental Illinois Nat. Bank and
Trust Co. of Chicago, 706 F.2d 193, 196-198 & n. 2 (7th Cir. 1983)
Restatement (2d) of Contracts 231-60 (1981) (A minor breach will not
generally give rise to a cause of action on the entire contract).
A determination as to whether a breach is material ``is a
complicated question of fact, involving an inquiry into such matters as
whether the breach worked to defeat the bargained-for objective of the
parties or caused disproportionate prejudice to the nonbreaching party,
[and] whether custom and usage considers such a breach to be
material.'' Sahadi, 706 F.2d at 196. These factors, however, do not
detract from the fundamental materiality inquiry: whether the parties
would have entered into the contract without the particular provision
at issue. Id. at 714; see also Francorp, Inc. v. Siebert, 126 F. Supp.
2d 543, 547 (N.D. Ill. 2000) (``The materiality of a breach depends on
the `inherent justice of the matter,' and on whether the matter, in
respect to which the failure of performance occurs, is of such a nature
and of such importance that the contract would not have been made
without it.'') In cases involving allegations of breach of a settlement
agreement, the burden is always placed on the party alleging breach to
establish that a breach has occurred. Porter v. United States Postal
Service, EEOC Appeal No. 01A54699 (December 20, 2005).
A breach of contract claim requires two components: (1) an
obligation or duty arising out of the contract and (2) factual
allegations sufficient to support the conclusion that there has been a
breach of the identified contractual duty. San Antonio Housing Auth. v.
United States, 143 Fed. Cl. 425, 470 (2019)[.]
VI. Findings and Conclusion
Priority Consideration for Inventory Property
On November 19, 1999, USDA and Complainant entered into a SA for
the purpose of resolving Complainant's program discrimination claims
through a mutually acceptable voluntary agreement. Per the SA, USDA
agreed to provide Complainant with priority consideration, on a one-
time basis for the purchase, lease, or other acquisition of inventory
property in the Commonwealth of Virginia. The SA required Complainant
to exercise this right to such priority consideration in writing and
within 5 years of the date of the signed SA.
Complainant asserts he searched FSA's property inventory website,
but the information available was always out of date. Also, Complainant
states he emailed FSA's Outreach Director and the point of contact for
FSA's inventory property. However, Complainant noted his emails were
never responded to in a timely manner. Complainant asserts he requested
an extension from USDA officials of the 5 year priority property
consideration stipulated in the SA. Complainant noted USDA's Assistant
Secretary for Civil Rights advised him to continue his ongoing efforts
to request a farm out of the inventory and contact FSA. (ROI, pg. 103)
We note Complainant did not provide any specific details or evidence
regarding his efforts to exercise his right to priority consideration
for an FSA inventory property. Despite his assertions, Complainant's
current allegation does not support a finding of FSA's material
noncompliance with the terms of the SA.
According to the FLM, Complainant contacted her about a Lassen
County, California property listed in FSA's inventory website on July
18, 2018. On July 24, 2018, the FLM responded to Complainant by
providing him with general information about the property and an
outline of the sale process. In addition, the FLM emailed Complainant
maps of the property location and added him to FSA's distribution list
to ensure he received the Notice of Sale once published. On the same
day, Complainant sent a subsequent email requesting the physical
address of the property. On July 27, 2018, the FLM informed Complainant
she was unable to locate a specific address for property and referred
him to the County Assessor's office for additional information. The FLM
explained the property remained in FSA's inventory, and Complainant was
to be notified once a Notice of Sale was prepared and published. (ROI,
pgs. 118, 313, 323-324)
The Mecklenburg County FLO stated he had no knowledge of
Complainant's request for inventory property and was not aware of any
other FSA personnel who may have assisted Complainant with his request.
According to the FLO, the process for requesting or purchasing FSA
inventory property can be found in Part 21 of the FSA Handbook 5-FLP.
Additionally, the FLO indicated no real estate inventory property was
available between July 18, 2018 and February 2019 for the Mecklenburg
FSA Farm Loan Program office. (ROI, pgs. 242-243)
FSA Handbook 5-FLP Part 21 states when FSA acquires inventory
property and the authorized agency official confirms that the property
satisfies the applicable general policies, the authorized agency
official initiates the sale of the property. For most inventory
property, the authorized agency official must begin advertising the
property for sale within 15 calendar days of title acquisition. FSA
offers inventory property to beginning farmers or socially
disadvantaged farmers before considering sale of the property to the
general public.\5\
---------------------------------------------------------------------------
\5\ For more information on the sale of FSA's inventory property,
see: https://www.fsa.usda.gov/Internet/FSA_File/5-flp.pdf.
---------------------------------------------------------------------------
While we agree Complainant was entitled to priority consideration
to USDA's property inventory, he did not utilize the benefit within the
timeframe and region covered by the SA. According to the SA,
Complainant was required to exercise his right to such priority
consideration in the Commonwealth of Virginia within 5 years of the
date the SA was signed. The SA between USDA and Complainant was signed
on November 19, 1999. As such, Complainant would have had until
November 19, 2004, to exercise his entitlement to priority
consideration. However, Complainant was seeking priority consideration
on July 18, 2018, well outside of the allotted timeframe set by the SA.
Complainant noted he attempted to obtain an extension of the 5 year
timeframe. However, nothing in the record shows the Agency approved his
extension request. Additionally, the SA stipulated Complainant would
have priority consideration for FSA properties in Virginia. The
property in question associated with the instant allegation of breach
of settlement was in California.
The compromise of any matter is valid and binding, not because it
is the settlement of a valid claim, but because it is the settlement of
a controversy. Weade v. Weade, 153 Va. 540, 150 S.E. 238 (1929) Here,
after the agreement was executed, the Agency was under no obligation to
enlarge the timeframes or geographic areas because Complainant did not
exercise his priority consideration as specified in the SA. Therefore,
we find there was no material breach of contract.
Conclusion
Based on our review of the record and the documentation submitted
by FSA and the Complainant, we conclude that the FSA complied with the
terms of the Settlement Agreement.
No person shall be subject to reprisal or harassment for filing a
discrimination complaint against USDA; participating in or contributing
to the identification, investigation, prosecution, or resolution of
civil rights violations by an agency of USDA or by a recipient of
Federal financial assistance from USDA; or otherwise aiding or
supporting the enforcement of civil rights laws, rules, regulations or
policies applicable to USDA programs.
Cinnamon L. Butler, 2/3/20
Director, Program Adjudication Division Date
Center for Civil Rights Enforcement
Submission No. 9
------------------------------------------------------------------------
United States Department of Agriculture, Office of the Assistant
Secretary for Civil Rights
------------------------------------------------------------------------
John W. Boyd, Jr.,
Complainant
v. Program Complaint No.: FSA-19-8204
Sonny Perdue,
Secretary,
Department of Agriculture
Agency
Final Agency Decision
I. Introduction
In accordance with 7 CFR Part 15d, this is the final determination
of the United States Department of Agriculture (USDA) on this
complaint.
II. Issue Presented
Whether Farm Service Agency (FSA) officials discriminated against
Complainant on the bases of race (African American) and retaliation
(prior civil rights activity) when on February 25, 2019:
1. They informed Complainant that USDA liens remained on his
property; \1\
---------------------------------------------------------------------------
\1\ We note the accepted issue is misstated. The record reveals
Complainant discovered the alleged remaining FSA liens from a third-
party, not FSA officials.
2. They failed to forgive all Complainant's USDA farm debt; \2\ and
---------------------------------------------------------------------------
\2\ Issue #2 was not originally a part of the issues established by
the complaint and/or OASCR's acceptance letter. However, due to an
email clarifying Complainant's claims, issue #2 has been added to the
instant discrimination complaint. (ROI, pg. 35-36)
3. From July 18, 2018 to February 1, 2019, they failed to provide
Complainant a farm in USDA inventory property as stipulated
in his settlement agreement.
III. Procedural History
Date of Alleged Discriminatory Act: February 25, 2019, July 18, 2018,
February 1, 2019
Date Complaint Filed: February 27, 2019
Date of Acceptance: April 15, 2019
Dates of Investigation: July 29, 2019-August 1, 2019
Date of Report of Investigation: October 9, 2019
IV. Statement of Facts
The U.S. Department of Agriculture's Farm Service Agency (FSA)
offers direct and guaranteed loans to farmers and ranchers to promote,
build, and sustain family farms for a thriving agricultural economy.
FSA offers a variety of loans to provide additional resources farmers
need to establish and maintain profitable farming operations. FSA's
Direct Loan Program is designed to help farmers start, purchase, or
expand their farming operation. From beginning farmers who have limited
financial history to qualify for commercial credit to farmers who have
suffered financial setbacks from natural disasters, FSA's Farm
Ownership Loans may be used to purchase a farm, enlarge an existing
farm, construct new farm buildings and/or improve structures, pay
closing costs, and promote soil and water conservation and
protection.\3\
---------------------------------------------------------------------------
\3\ For more information on FSA's Farm Loan Programs, see: https://
www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/FactSheets/2019/farm-
loans-overview.pdf.
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Complainant resides and farms in Mecklenburg County, VA. Beginning
in 1984, Complainant has participated in FSA's Farm Loan programs.
During this period, Complainant was approved for and received several
farm ownership and operating loans. In reviewing Complainant's
complaint history, it shows he has filed numerous program complaints
related to his FSA loans over the years, which eventually resulted in a
finding of discrimination. As a result, Settlement Agreements (SAs)
were executed on May 20, 1997, and November 19, 1999.\4\ Complainant
also participated in the Black Farmers class action lawsuit, otherwise
known as Pigford.\5\ The 1997 SA ordered forgiveness of all
Complainant's FSA loan debt. Complainant thus currently does not have
any outstanding USDA farm loan program debt. The 1999 SA also ordered
Complainant be provided priority consideration in obtaining FSA farm
inventory property. (ROI, pgs. 5, 31-32, 214-216)
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\4\ The 1997 SA was based on a discrimination complaint submitted
by Complainant on February 18, 1992 and USDA's related Final Agency
Decision issued on October 11, 1996. The 1999 SA applied to all of
Complainant's 1990 discrimination complaints submitted to USDA. (ROI,
pgs. 31-32, 214-216)
\5\ African American farmers successfully sued the USDA alleging
years of systematic discrimination in administering farm programs in
violation of the Equal Opportunity Act (ECOA). See Pigford v. Glickman,
185 F.R.D. 82 (D.D.C. 1999), aff'd, 206 F.3d 1212 (D.C. Cir. 2000).
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On July 17, 1997, a Farm Loan Manager (FLM #1) (race: White) sent
Complainant's attorney six Certificates of Satisfaction and Promissory
Notes for release. Additionally, FSA forwarded documentation to
Complainant's attorney which included a Termination Statement for the
release of the financing statements that were on record with the
Mecklenburg Clerk's Office. (ROI, pgs. 128, 131-179)
On July 18, 2018, Complainant emailed FLM #2 (race: White)
requesting additional information on specific property listed on FSA's
inventory property website. (ROI, pgs. 325-326)
On July 24, 2018, FLM #2 responded to Complainant's email inquiry
with a phone call. During the call, FLM #2 provided Complainant with
general information on the property he was interested in and a general
outline of the sale process. Also, FLM #2 added Complainant's name and
email address to the distribution list to ensure he received the notice
of sale of the property once it was published. (ROI, pgs. 325, 306-307)
On the same day, Complainant emailed FLM #2 requesting the physical
address and name of the previous owner for the subject property. (ROI,
pg. 324)
On July 27, 2018, FLM #2 responded to Complainant's email by
stating she did not have access to the physical address. FLM #2
recommended Complainant contact the County Assessor. Additionally, FLM
#2 expressed she would attempt to locate the address and let
Complainant know the results. (ROI, pg. 324)
In February 2019, Complainant met with a closing company to make
final preparation for the purchase of a property.\6\ During the
meeting, the closing company performed a title search and found
outstanding liens remained on Complainant's farm. As a result of the
outstanding liens, Complainant was not able to immediately secure the
loan he needed to purchase the property at that time. (ROI, pgs. 97-98)
---------------------------------------------------------------------------
\6\ We note this was not the initial FSA property in which the
Complainant previously inquired.
---------------------------------------------------------------------------
On February 26, 2019, Complainant called and visited the
Mecklenburg County FSA office seeking assistance with outstanding
Farmers Home Administration liens presumed to be on his property.
During the visit, the Farm Loan Officer (FLO) (race: White) informed
Complainant he had located copies of satisfaction documents and could
reissue them since they were not filed after being provided to
Complainant's attorney. Additionally, the FLO informed Complainant the
documents would need to be signed by the Farm Loan Manager and then
notarized. The FLO informed Complainant that the documents could be
completed and sent to the closing company within 2 days. (ROI, pgs.
239-240)
On the same day, Complainant emailed the FLO requesting copies of
the promissory notes associated with the satisfaction of deeds of trust
for his properties. (ROI, pg. 240)
On February 27, 2019, Complainant filed a complaint with the Office
of the Assistant Secretary for Civil Rights (OASCR). (ROI, pgs. 13-17)
On March 11, 2019, Complainant emailed FLM #2 to see if she had
found anyadditional information on the farm of interest. (ROI, pg. 323)
On the same day, Complainant emailed FSA's Riverside-San Diego
County, California County Executive Director (CED) requesting
additional information on a property in FSA's inventory and the next
steps in the process. (ROI, pg. 121)
On April 2, 2019, the CED responded to Complainant's email and
referred him to two additional FSA contacts for details on the
property. (ROI, pg. 120)
On September 6, 2019, FLM #2 responded to Complainant's email by
informing him that the property of interest was still in the FSA
inventory. According to FLM #2, FSA was still working through the steps
to prepare the property for sale as a surplus property. (ROI, pg. 323)
V. Applicable Legal Standards
Discrimination Based on Membership in a Protected Class in Programs
Conducted by USDA
USDA regulation 7 CFR 15d.3(a) provides:
No agency, officer, or employee of the United States
Department of Agriculture shall, on the ground of race, color,
religion, sex, age, national origin, marital status, familial
status, sexual orientation, or disability, or because all of
part of an individual's income is derived from any public
assistance program, exclude from participation in, deny the
benefits of, or subject to discrimination any person in the
United States under any program or activity conducted by the
United States Department of Agriculture.
Reprisal--7 CFR 15d.3(b)
USDA regulation 7 CFR 15d.3(b) prohibits discrimination on
the basis of retaliation in any program or activity conducted
by USDA. It is the policy of USDA to follow the framework
provided by Title VII of the Civil Rights Act of 1964 to
determine a prima facie case of retaliation.
Dismissal
USDA will close a complaint under the following circumstances:
a. Voluntary withdrawal;
b. Settlement or voluntary resolution;
c. Lack of jurisdiction;
d. Failure to state a claim;
e. Failure to pursue;
f. Failure to file timely;
g. Filing in court on the same or essentially similar claims;
h. Lack of any further remedies;
i. Any other authority provided in law;
j. Failure to seek remedy available under the statues, regulation,
or court decision;
k. Continuation of a pattern of complaints previously filed by the
complainant, or someone other than the complainant, that
the Office of the Assistant Secretary for Civil Rights or a
court of competent jurisdiction already have found to be
without merit;
l. Dissatisfaction with the processing of a previously filed
complaint.\7\
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\7\ See Departmental Regulation 4330-003.
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Issue #2--Failure to State a Claim
A dismissal for failure to state a claim is intended to address a
dispositive issue of law. Under this procedural disposition, the trier-
of-fact does not assess the merit or truthfulness of the allegations or
the legal theories advanced by Complainant. Rather, the trier-of-fact
assumes that all facts advanced by Complainant are true. If, under this
assumption, it is clear that no relief could be granted under any set
of facts that could be proved consistent with the allegations, the
complaint must be dismissed for failure to state a claim. See Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 1964-65, 167 L.
Ed. 2d 929 (2007) (Factual allegations must be enough to raise a right
to relief above the speculative level.)
In issue #2, Complainant alleges FSA officials discriminated
against him based on race, from July 18, 2018 to February 1, 2019, when
they failed to provide Complainant a farm from FSA's inventory
property, as stipulated in the terms of the November 19, 1999 SA. We
find Complainant fails to state a claim because issue #2 is concerned
solely with what he perceived as FSA's failure to satisfy the terms of
the SA--not a new adverse action based on race. The SA stipulated
Complainant be allowed priority consideration for obtaining an FSA farm
inventory property. Even though this issue will be reviewed under a
separate breach of SA analysis, we note the terms of the SA established
a 5 year timeframe for providing priority consideration. The period in
which Complainant alleges issue #2 occurred is 15 years after the terms
of the SA expired.
Furthermore, Complainant does not articulate how his race related
to his inability to obtain FSA inventory property. According to the
record, at the time the instant complaint was investigated, the
property at issue remained in FSA's inventory property and was still
being prepared for the sale process. As a result, there was not an
opportunity for Complainant to purchase property. Complainant does not
allege that the property was unreasonably delayed for sale due to
discriminatory animus or that other similarly situated buyers of a
different protected class were given priority, notice, or more
favorable treatment. Therefore, this issue is dismissed for failure to
state a claim upon which relief may be granted. (Requirement that
pleading contain a short or plain statement of claim showing the
pleader is entitled to relief does not require detailed factual
allegations but demands more than unadorned the defendant unlawfully
harmed me accusation.) Ashcroft v. Iqbal, 556, U.S. 662, 129 S. Ct.
1937, 173 L. Ed. 2d 868 (2009)[.]
VI. Discussion and Analysis
A. Disparate Treatment (Race)
In evaluating a claim of disparate treatment based on membership in
a protected class, it is USDA policy to use the shifting analytic
framework established by the Supreme Court in McDonnell Douglas Corp.
v. Green, 411 U.S. 792 (1973). The Court has defined disparate
treatment as situations where an Agency ``simply treats some people
less favorably than others because of their race, color, religion, sex,
or other protected characteristic.'' See International Brotherhood of
Teamsters v. U.S., 431 U.S. 358, 335, n. 15 (1977). Applying the
McDonnell Douglas principles, the investigating agency must first
determine if a complainant can raise an inference of discrimination by
establishing a prima facie case. The elements of a prima facie case may
vary depending on the facts of the complaint, but often include the
following:
(1) Complainant is a member of a protected class;
(2) Complainant applied for and was eligible to receive the benefit
sought;
(3) Despite Complainant's eligibility, he/she was rejected, referred
elsewhere, or otherwise treated differently; and
(4) The Agency/Respondent accepted or treated more favorably
similarly situated applicants who were not members of the
protected class or classes.
See Lawson v. CSX Transp., Inc., 245 F.3d 916 (7th Cir. 2001);
McDonnell Douglas Corp., 411 U.S. at 802.
Once a complainant has established a prima facie case for
discrimination, a rebuttable presumption exists that discrimination has
occurred, the burden shifts to the Agency to articulate a legitimate
nondiscriminatory reason for its action(s). See Texas Dept. of
Community Affairs v. Burdine, 450 U.S. 248, 254 (1981). Once the Agency
has satisfactorily articulated a legitimate nondiscriminatory reason
for its actions, the burden shifts back to the complainant to prove,
that the Agency's legitimate, nondiscriminatory reason is a pretext for
discrimination. See McDonnell Douglas at 804-05. At all times,
complainant retains the burden of persuasion that unlawful
discrimination has occurred. See Burdine at 256.
In disparate treatment cases, the established order of analysis
requires a complainant establish a prima facie case of discrimination.
However, determining the existence of a prima facie case need not be
followed in all cases. Where the Agency has articulated a legitimate,
nondiscriminatory reason for the action at issue, the factual inquiry
can proceed directly to the ultimate issue whether Complainant has
shown by a preponderance of the evidence that discrimination motivated
the Agency's actions. See U.S. Postal Service Board of Governors v.
Aikens, 460 U.S. 711, 713-714 (1983). Here, we will assume, without
finding, for purposes of analysis, that Complainant established a prima
facie case of disparate treatment based on race.
Accordingly, the burden shifts to the Agency to articulate a
legitimate, nondiscriminatory reason for the actions grieved by
Complainant.
B. Agency's Legitimate, Nondiscriminatory Reasons
The only inquiry to determine whether or not the Agency has
produced evidence to sufficiently articulate a legitimate,
nondiscriminatory reason is whether the Agency's evidence has frame[d]
the factual issue with sufficient clarity so that the plaintiff will
have a full and fair opportunity to demonstrate pretext.'' * See Texas
Department of Community Affairs v. Burdine, 450 U.S. 255-56 (1981). As
described below, we find that FSA has articulated a legitimate,
nondiscriminatory reason for its actions.
---------------------------------------------------------------------------
* Editor's note: there is no corresponding open quote mark (``) for
this quotation. It has been reproduced herein as submitted.
---------------------------------------------------------------------------
FLM #1 stated FSA took proper steps to remove the liens. FLM #1
asserted she, along with her staff, prepared all the necessary
documents to remove Complainant's FSA liens. Then, officials sent the
Certificates of Satisfaction and the Promissory Notes via certified
mail to Complainant's attorney to have FSA liens removed from the
record. (ROI, pgs. 231, 234)
According to the FLM #1, USDA officials did not always go to the
County Clerk's Office to file or release liens. FLM #1 asserted when
borrower's loans were closed by attorneys, USDA would send the lien to
the attorney to file in the County Clerk's Office. FLM #1 further
explained when Complainant received his USDA loan to purchase the farm,
the attorney who closed the loan filed the USDA lien in the County
Clerk's Office. (ROI, pg. 234)
We find the above is sufficient and the Agency has articulated a
legitimate, nondiscriminatory reason for its actions. Therefore, the
burden now shifts to the Complainant to prove, by a preponderance of
the evidence that these reasons are a mere pretext for unlawful
discrimination.
C. Pretext
As the Agency has articulated legitimate, nondiscriminatory reasons
for its actions, to prevail, the complainant must now prove, but a
preponderance of the evidence, why these proffered reasons are untrue
or a more pretext for unlawful discrimination. Burdine at 253. The
complainant can ``succeed in this either directly by persuading the
trier of facts that a discriminatory reason more likely motivated the
agency or indirectly by showing that the agency's proffered explanation
is unworthy of credence.'' Burdine 256. A complainant can demonstrate
pretext by exposing such weakness, implausibility, inconsistencies,
incoherencies, contradictions'' ** in the Agency's reasoning that a
fact finder could find the Agency's articulated explanation unworthy of
credence. See Richmond v. ONEOK, Inc. 120 F.3d 205,209 (10th
Cir.1997)[.]
---------------------------------------------------------------------------
** Editor's note: there is no corresponding open quote mark (``)
for this quotation. It has been reproduced herein as submitted.
---------------------------------------------------------------------------
Complainant alleges FSA officials failed to forgive all of his USDA
farm debt. However, we are not persuaded by Complainant's assertions,
as he has not shown by a preponderance of the evidence that
discriminatory animus motivated or caused the alleged adverse action.
It is reasonable to assume that if FSA had not forgiven all of
Complainant's farm loan debt as indicated in the SA, FSA would have
made attempts to collect the debt from Complainant at some interval
over the course of 20 years. Under normal processes, delinquent
borrowers receive various notifications (i.e., notice of intent to
accelerate, notice of foreclosure) and demands for payment when they
are delinquent on their loans. However, USDA's last contact with
Complainant regarding the subject loans was on July 17, 1997, when FSA
sent Complainant's attorney the Certificates of Satisfaction and the
Promissory Notes to release USDA's liens.
Although 20 years passed before Complainant discovered any issues
associated with the documentation of the debt forgiveness, the 1997 SA
clearly established USDA would forever discharge, hold harmless, and
indemnify Complainant from any liability for his debt at that time.
(ROI, pgs. 31, 131) We find Complainant's debt had been forgiven by
USDA, and he has not provided any evidence which demonstrates FSA did
not forgive his debt based on his race.
Additionally, the record evidence confirms that Agency officials
supplied Complainant's attorney with the requisite documentation to
release USDA liens on Complainant's properties after loans where
satisfied. The trier of fact is unpersuaded that FLM #1 had intentions
of not releasing liens based upon race. Rather, it was Complainant's
responsibility to ensure his representative had filed the appropriate
paperwork with the County Clerk's Office. Contrary to Complainant's
assertions, FLM #1's response suggests that she took meaningful steps
to ensure Complainant's attorney received the documentation needed to
release liens from public record. Complainant did not provide any
evidence to substantiate claim of discrimination by FSA officials.
Absent any operative facts that would lend credence to Complainant's
allegations, his mere conjecture is insufficient to demonstrate
pretext. Reed v. Amax Coal Co., 971 F.2d 1295, 1299 (7th Cir. 1992)
(plaintiff cannot make showing of discrimination through bare
allegations). Miller v. Auto. Club of KM, Inc., 420 F.3d 1098 (10th
Cir. 2005) (recognizing unsupported suspicions are insufficient to
establish discrimination).
Retaliation
To establish a prima facie case of reprisal discrimination, a
plaintiff must prove that:
(1) Complainant engaged in a protected activity;
(2) Agency had knowledge of the protected activity;
(3) Complainant subsequently suffered an adverse action; and
(4) But for the prior protected activity, the adverse action would
not have occurred. University of Texas Southwestern Medical
Center v. Nassar, 133 S. Ct. 2517 (2013)[.]
For the first prong, Complainant must show he engaged in prior
protected activity. The record shows Complainant filed several civil
rights complaints regarding his FSA farm loans. Complainant satisfies
prong #1. (ROI, pg. 5)
For the second prong, the record sufficiently establishes FSA
officials had knowledge of Complainant's prior civil rights activities.
Therefore, Complainant meets the requirements of prong #2.
Regarding the third prong, Complainant must show he suffered an
adverse action.\8\ Complainant claims he was retaliated against by FSA
officials when they failed to remove liens on his farms. In February
2019, Complainant attempted to purchase a farm. The closing company
performed a title search on Complainant's properties and informed him
that FSA liens remained on his farms. As a result, Complainant contends
he had to negotiate an extension agreement for an additional 30 days to
secure the prospective loan and purchase the property. The extension
agreement required Complainant to deposit an additional $25,000 to his
original deposit of $50,000. As such, Complainant meets the
requirements of prong #3.
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\8\ In the context of a retaliation claim, an action is ``adverse''
if it would dissuade a reasonable person from making or supporting a
charge of discrimination. See Burlington N & Santa Fe Ry. Co. v. White,
548 U.S. 53, 54 (2006).
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Finally, for prong #4, Complainant must show the adverse action
suffered would not have taken place if it were not for his prior
protected civil rights activities. The record shows in accordance with
the May 20, 1997 SA, all of Complainant's debt owed to the Agency was
forgiven. However, to a reasonable person, the record does not support
an inference that the recordation of FSA liens on Complainant's farms
in 2019 was caused by the negotiated SA from 1997.
It is unclear to the trier of fact who had the ultimate
responsibility of filing the appropriate paperwork regarding FSA liens
on Complainant's farms to the Mecklenburg Clerk's Office. The available
records show delivery of certified mail to Complainant's attorney
containing six Certificates of Satisfaction and Promissory Notes for
the release of FSA liens. (ROI, pg. 131). Under the common law of
agency, the signature of a disclosed, authorized agent has the same
legal force as the signature of his principal.
We acknowledge it was a financial burden for Complainant to provide
additional funding to secure loan because FSA liens remained
erroneously recorded on his land though the obligation to pay was
extinguished. However, the Agency's related actions regarding
Complainant, i.e., discharge of debt, not sending notices of debt owed,
and immediate assistance when the recording error was discovered,
weighs against the perception of wrongdoing, negligence, or retaliatory
motives on the Agency's part. Complainant and/or his attorney bore some
responsibility to conduct due diligence and ensure the liens were
released with the Mecklenburg County Clerk's Office. This inaction
resulted in Complainant having to provide additional funding to secure
the prospective loan. Considering the above, we conclude Complainant
does not meet the requirements of prong #4.
To establish retaliation based on temporal proximity, Complainant
would have to demonstrate the adverse action was followed closely after
his protected activity. If we construe his prior protected activity in
the light most favorable to Complainant, his protected activities
occurred on May 20, 1997 and November 19, 1999 when the SAs were
executed. However, Complainant did not discover that liens remained on
his property until February 2019. Here, almost 20 years elapsed between
the last protected activity (November 19, 1999) and the alleged adverse
action (February 2019). In general, a complainant can demonstrate a
causal connection using temporal proximity alone when the separation
between the Agency's knowledge of the protected activity and the
adverse action are very close. Twenty years is a substantial amount of
time to show a correlation between protected activity and adverse
action. Additionally, there have been no new allegations of retaliation
regarding these loans since the November 19, 1999 SA was executed.
Complainant has not offered any other evidence that would establish
temporal proximity in his claim of retaliation. See Nguyen v. City of
Cleveland, 229 F.3d 559 (6th Cir. 2000) (holding that temporal
proximity alone may be insufficient to raise an inference of
retaliation in the absence of other evidence of causation).
We find Complainant has not established a prima facie case of
retaliation.
VII. Conclusion
After careful review, and for the reasons set forth previously,
USDA finds the record does not support a finding of discrimination
based on retaliation.
No person shall be subject to reprisal or harassment for filing a
discrimination complaint against USDA; participating in or contributing
to the identification, investigation, prosecution, or resolution of
civil rights violations by an agency of USDA or by a recipient of
Federal financial assistance from USDA; or otherwise aiding or
supporting the enforcement of civil rights laws, rules, regulations or
policies applicable to USDA programs.
Cinnamon L. Butler, 2/3/20
Director, Program Adjudication Division Date
Center for Civil Rights Enforcement
U.S. Department of Agriculture
Office of the Assistant Secretary for Civil Rights
Complaint of Program Discrimination
Complainant: John W. Boyd, Jr.
Complaint No.: FSA-19-8204
Agency: Farm Service Agency
Certificate of Service
I certify that the document listed was sent on this date by certified
mail (unless otherwise specified) to:
Complainant: John W. Boyd, Jr.
[Redacted]
[Redacted], Virginia 23915
Agency Head: Richard Fordyce (interoffice mail)
Administrator
Farm Service Agency
Room 3096S, South Building
Agency Liaison: Emily Su (interoffice mail)
Director, Civil Rights
Farm Production and Conservation
PP III, 12th floor
Certified by: Date
7012 3460 0003 3832 6288
The Chairman. Thank you so much, Mr. Boyd, for your
excellent testimony.
And next, we have Mr. Blanding. Please begin your
testimony.
STATEMENT OF CORNELIUS BLANDING, EXECUTIVE
DIRECTOR, FEDERATION OF SOUTHERN COOPERATIVES/LAND ASSISTANCE
FUND, EAST POINT, GA
Mr. Blanding. Good afternoon, Mr. Chairman, Madam Vice
Chair, Mr. Ranking Member, and Members of the Committee. My
name is Cornelius Blanding, and I am the Executive Director of
the Federation of Southern Cooperatives/Land Assistance Fund, a
54 year old cooperative association of Black farmers,
landowners, and cooperatives from all across the South.
Founded directly out of the civil rights movement in 1967,
the Federation is the oldest and largest Black farmer-owned and
-serving institution in the country. It is also the only
cooperatively-owned organization of Black farmers, landowners,
and cooperatives focusing primarily on Black land loss and the
use of cooperatives as a tool to increase income and build
wealth in the South, where 80 percent of all Black farmers are
located.
I am honored to be before this Committee today, testifying
on the realities, struggles, and perseverance of Black farmers
and landowners in the U.S. South. I have submitted my full
statement to the Committee, which I ask to be made part of the
hearing record.
As part of my brief opening statement, I would like to
thank this Committee again for this opportunity to testify
before as part of this historic hearing on Black farmers. I
have served the Federation of Southern Cooperatives and Black
Farmers for the past 24 years, and as the executive of the
Federation for the past 6 years.
We, the Federation of Southern Cooperatives, based on a
study we did 41 years ago in 1980, entitled, The Impact of Heir
Property on Black Rural Land Tenure in the Southeastern Region
of the United States, that was commissioned by Congress and
funded by the United States Department of Agriculture, and
based on over 50 years of work, we estimate that approximately
60 percent of all Black-owned land is heirs property--land that
lacks a clear title and that the landowner dies without a will
or estate plan, and is passed down informally to the heirs of
deceased landowners. It is the reason that I and thousands of
others in the Black community are not Black landowners or still
farming today.
So, you see, this work is personal for me, just like it is
for other folks testifying on this hearing today, like it is
for thousands of Black farmers and advocates across this
country. Heirs property is a civil rights issue. All the
citizens of our country should have access to government
services, but because of heirs property, many don't, and for
decades Black farmers haven't, and this has resulted in Black
land loss. These are all things that could have been addressed
with good and reasonable legislation, including the $1.9
trillion American Rescue Plan of 2021 recently passed by the
Senate and the House, and signed into law by the President.
As I mentioned in my opening statement, Mr. Chairman, I am
here to testify on the realities, struggles, and perseverance
of Black farmers and landowners. The reality is that Black
farmers are going out of business and lost the highest
percentage of land than any other group in this country over
the past century.
In 1910, there were 218,000 Black farmers owning roughly 15
million acres of land. According to the U.S. Census Bureau in
1992, there were only 18,000 Black farmers owning 2.3 million
acres of land. That is over a 90 percent loss of Black farmers,
as well as almost a 90 percent loss of Black-owned land.
Another reality is that the majority of Black farmers get
their credit from USDA's Farm Service Agency, the lender of
last resort, which they are expected to graduate out of that
system in 7 years, and after that, they are supposed to qualify
for credit in the traditional market. However, that date never
comes for most Black farmers. Instead, they are relegated to
predatory-style lenders at best, and farming out of their
pockets at worst. No business, especially farming, can survive
in this reality. The reality is also that Black farmers have
historically been discriminated against in various ways--
including at USDA, as shown in the historic lawsuit, Pigford v.
Glickman. These realities have led to the struggles of Black
farmers, the struggles to hold on to land for generations
because of unsecure or cloudy titles and discrimination. The
realities of Black farmers have also led to the struggle to
successfully operate farms in a sector where they buy in the
retail market and sell in the wholesale market, primarily
because of lack of scale. Eighty percent of Black farmers
operate on 100 acres or less.
These realities have also led to the struggles to access
enough fair and equitable credit for farmers to grow their
business and become part-time--beyond part-time subsistence
farms. However, these struggles and realities have forced Black
farmers and landowners to be some of the most resilient people
in their communities and in this country. Black farmers have
persevered through the difficult days of sharecropping and the
long nights of racism and discrimination, and continue to
persevere in spite of the issues of heirs property, the lack of
access to fair and equitable credit, and they continue to be on
the front lines of feeding families, anchoring rural
communities, and protecting our environment, regardless of
these realities and struggles.
The Black farmer's story is of perseverance, and it is
about time this story is told. It is about time for a hearing
such as this. It is about time for our country to support those
that have given so much but receive so little in exchange.
In closing, Mr. Chairman, I reiterate the Black farmer's
story is one of struggle and perseverance, and so I end with
that, Mr. Chairman, but our air, our water, our soil, and our
lives depend on Black farmers.
Thank you, Mr. Chairman and Members of this Committee for
this opportunity to appear before you today. I stand ready for
any questions you may have.
Thank you.
[The prepared statement of Mr. Blanding follows:]
Prepared Statement of Cornelius Blanding, Executive Director,
Federation of Southern Cooperatives/Land Assistance Fund, East Point,
GA
Good afternoon, Mr Chairman, Madam Vice Chair, Mr. Ranking Member,
and Members of the Committee.
My name is Cornelius Blanding and I'm the Executive Director of the
Federation of Southern Cooperatives/Land Assistance Fund, a 54 year old
cooperative association of Black farmers, landowners and cooperatives
from all across the South.
Founded directly out of the civil rights movement in 1967, the
Federation is the oldest and largest Black farmer owned and serving
institution in the country. It is also the only cooperatively owned
organization of Black farmers, landowners and cooperatives focusing
primarily on Black land loss and the use of cooperatives as a tool to
increase income and build wealth in the South, where 80% of all Black
farmers are located.
I am honored to be before this Committee today, testifying on the
realities, struggles and perseverance of Black farmers & landowners in
the U.S. South. I have submitted my full statement to the Committee,
which I ask to be made part of the hearing record.
As part of my brief opening statement, I would like to thank this
Committee for this opportunity to testify as part of this historical
hearing on Black farmers.
I am not a Black farmer nor do I pretend to speak on behalf of all
Black farmers. I am merely a servant of the Federation of Southern
Cooperatives as well as the Black farmer and cooperative movements;
thus I testify on behalf of our membership, Board of Directors and all
those who came before me. It is my hope that my testimony is a
reflection and adequate representation of all those giants who couldn't
be here today, but are the reasons that I am here.
I have served the Federation of Southern Cooperatives and Black
farmers for the past 24 years and as the Executive Director of the
Federation for the past 6 years.
I am a son of the South. I was born and raised in the South. I was
educated in the South. I live and work in the South and I am raising my
family in the South.
I am also a product of public housing and public assistance in
Montgomery, Alabama, the cradle of the Civil Rights Movement. I was
raised by a single mother in public housing and on public assistance. A
single mother who was also one of seven heirs to over 40 acres of land
in rural Lowndes County, Alabama.
My family was targeted by an unscrupulous lawyer and one of the
heirs was bought out for pennies on the dollar, which resulted in a
forced partition sale. Unfortunately, my story is not unique. I am part
of a common story in the Black community.
We, the Federation of Southern Cooperatives--based on a study we
did 41 years ago in 1980, entitled ``The Impact of Heir Property on
Black Rural Land Tenure in the Southeastern Region of the United
States'' that was commissioned by Congress and funded by USDA . . . .
and based on over 50 years of work--estimate that approximately 60% of
all Black owned land is heirs' property; land that lacks a clear
title--in that the landowner dies without a will or estate plan and the
land is informally passed down to the heirs of the deceased land owner.
With this cloudy or unclear title, called heirs property, the heirs
or landowners lack the ability to access USDA programs, resources or
credit; thus putting the land in a vulnerable position. In fact, heirs'
property is one the major reasons for Black land loss.
It is the reason my mother and her siblings lost 40 acres of land
in rural Lowndes County, Alabama, and it is part of the reason my
mother was forced to raise me, my brother and sister in public housing
on public assistance about 30 miles east in the more urban city of
Montgomery, Alabama.
It is the reason that I and thousands of others in the Black
community are not Black landowners or still farming today. So you see,
this work is personal for me, just like it is for the other folks
testifying here today; and like it is for thousands of Black farmers
and advocates across this country.
Heirs' property is a Civil Rights issue. All of the citizens of our
country should have access to government services; but because of
heirs' property, many don't. For decades, Black farmers haven't . . .
and this has resulted in Black Land Loss. The other major reasons for
Back Land Loss are discrimination and access to fair & equitable
credit.
These are all things that could have been addressed with good and
reasonable legislation. These are things that are just now starting to
be addressed with the introduction of the Justice for Black Farmers
Act, the Emergency Relief for Farmers of Color Act, the Reconciliation
Bill passed by this Committee and the $1.9 Trillion American Rescue
Plan recently passed by the Senate and the House; and signed into law
by the President.
We applaud Senators Booker, Warren, Gillibrand, Smith, Leahy,
Warnock, Lujan and Stabenow. We applaud the House Agriculture Committee
and its leadership. We applaud the House and Senate for getting this
historical legislation passed. We applaud the Administration for its
vision and USDA leadership for its support. We also applaud the many
foot soldiers out there whom have tilled the soil, advocated for these
issues, followed the stories, researched and wrote legislation as well
as all those that dreamed of and struggled for this day to come.
But Black farmers are not out of the woods yet. It is not time for
celebration just yet. This is not the beginning of the story of Black
farmers nor is it the end. It is merely one of the many chapters of
Black farmers & landowners; one of the many chapters of our rural
communities; of urban migration and of our nation.
As I mentioned in my opening statement, Mr. Chairman, I am here to
testify on the realities, struggles and perseverance of Black Farmers &
Landowners.
The reality is that Black farmers have gone out of business and
lost the highest percentage of land than any other group in this
country over the past century.
In 1910, there were 218,000 Black farmers owning roughly 15 million
acres of land. According to the U.S. Census; in 1992, there were only
18,000 Black farmers owning 2.3 million acres of land. That's over a
90% loss of Black farmers as well as almost a 90% loss of land.
Another reality is that the majority of Black farmers get their
credit from USDA's Farm Service Agency--the lender of last resort. This
in itself is risky because farmers are expected to graduate out of the
system in 7 years. After that, they are supposed to qualify for credit
in the traditional market; however that date never comes for most Black
farmers. Instead they are relegated to predatory style lenders at best
and farming out of their pockets at worst. No business--especially
farming--can survive in this reality. Credit is the life line of any
business and is crucial in farming.
The reality is also that Black farmers have historically been
discriminated against in various ways--including at USDA--as shown in
the historical Black farmer lawsuit (Pigford 1 and Pigford 2) . . . .
Discriminated against at FSA, the lender of last resort. Thus, the
Black farmers' reality is bleak even as it relates to credit.
These realities have led to the struggles of Black farmers. The
struggle to hold onto land for generations because of unsecure or
cloudy titles . . . when the problem of heirs property could be solved
with some simple steps, such as uniform heirs' property legislation;
adequate funding for the existing heirs' property relending program
that was approved as part of the 2018 Farm Bill; and targeted resources
for awareness, education and direct legal & technical assistance to
heirs' property landowners.
The realities of Black farmers have also led to the struggle to
successfully operate their farm business in a sector where they buy in
a retail market, but sell in a wholesale market--primarily because of
their lack of scale. 75-80% of Black farmers operate on 100 acres or
less and primarily grow perishable products. A reality that begs for
cooperative solutions that aggregate producers; and which could be
addressed with more resources for cooperative developmentvia programs
throughout all of USDA.
And the realities of Black farmers have led to the struggle to
access enough fair & equitable credit to grow their farms and
businesses beyond part-time and/or subsistence farms. And this could
readily be addressed with the creation of a cooperatively owned Black
Farmer Financial Institution, owned and controlled by Black farmers.
However, these struggles and these realities have forced Black
farmers and landowners to be some of the most resilient people in their
communities and in this country.
Black farmers and landowners have persevered through the difficult
days of share-cropping and the long nights of racism and
discrimination. They continue to persevere in spite of the issues of
heirs' property and the lack of access to fair & equitable credit.
Black farmers and landowners continue to be on the front lines of
feeding families, anchoring rural communities and protecting our
environment regardless of their realities and struggles.
The Black farmer story is a story of perseverance. It is about time
for this story to be told. It is about time for this kind of hearing.
It is about time for our country to support those that have given so
much, but received so little in exchange.
The Black farmer story is the American story. The realities &
struggles of Black farmers are woven into the fabric of this country.
Black farmers are a part of and vital to our food system, the
environment and our nation. But far too often Black farmers are losing
their land.
As my late predecessor and mentor, Mr. Ralph Paige, was quoted in a
New York Times article in 2018, ``when a Black farmer loses his land,
it's our community losing a piece of this country.'' Now, I would take
that a step further and say, ``it is also this country losing a piece
of our community . . . and thus a part of itself.''
Discrimination and land loss is all to prevalent in the lives of
Black farmers and the Black community, which makes it difficult for
many to see themselves in this great nation and as part of the solution
to many of its challenges.
So in closing, Mr. Chairman, I must reiterate that the Black farmer
story is one of struggle and perseverance. A reality of land loss,
discrimination, and lack of access to credit and resources . . . And
yet, a reality of feeding families, anchoring communities and
protecting our environment.
The solutions to the challenges of our nation rest in the hands of
our government, our organizations and corporations, as well as our
citizens--including and especially our farmers & landowners; and this
must include Black farmers & landowners.
But we must first make them whole, in order for them to be the most
effective contributors that they can be.
Our air, our water, our soils and our lives depend on it!
Thank you, Mr. Chairman and Members of the Committee, for the
opportunity to appear before you today during this most historic
hearing on Black farmers. I stand ready to answer any questions you
might have.
The Chairman. Thank you so much. I appreciate your
excellent testimony.
Mr. Haynie, please begin now.
STATEMENT OF PHILIP J. HAYNIE III, CHAIRMAN, NATIONAL BLACK
GROWERS COUNCIL, BURGESS, VA
Mr. Haynie. Mr. Chairman, Secretary Vilsack, Members of the
Committee, staff of the Committee, and to the many others that
have worked tirelessly in making this hearing possible, I would
like to say thank you. Thank you on behalf of the Black farmers
and landowners who have been asking, praying, and waiting so
long for relief. I would also like to say thank you on behalf
of the Black farmers who have passed on without personally
being able to witness this day.
Mr. Chairman, I come before you today on behalf of the
National Black Growers Council, an organization that consists
of multi-generational farmers who advocate for the interest of
Black farmers in their local communities, in their states, and
to the Federal Government. An organization whose mission is to
improve the efficiency, productivity, and sustainability of
Black row crop farmers.
Mr. Chairman, I think we all know the statistics that two
percent of the U.S. population of farmers, and that Black
farmers represent less than two percent of the entire 100
percent of farmers in the United States. What I would like the
Committee to truly recognize is that Black row crop farmers
represent less than eight percent of the entire Black farm
population. Mr. Chairman, Black farmers that grow corn, cotton,
soybeans, peanuts, and rice are on the verge of extinction. Mr.
Chairman, it is imperative that we support the remaining Black
farmers that exist. It is imperative that we address the
disparities and inequities that exist between Black farmers and
their White neighbors, and it is imperative that we put
programs in place that remove the economic knee that is on the
neck of a lot of Black farmers and landowners.
As we at the National Black Growers Council have said
before, land is a farmer's most valuable and productive asset.
As you canvass the country, you will often find Black farmers
on non-irrigated land trying to compete with their White farmer
neighbors who have used USDA programs to put irrigation on
their land. You will also find Black farmers who have not been
able to participate in land leveling and drainage, and other
USDA programs to improve their farms like their White
neighbors. These inequities place Black farmers at a
significant disadvantage to producing higher yields and being
profitable.
Mr. Chairman, on a trip to the local USDA office to inquire
about a beginning farmer loan, the county executive director
brandished a loaded handgun at my father and I and told me that
I did not need to get involved in farming and go get a job. My
father, like many other Black farmers across this nation, was a
victim of discrimination by USDA. After settling his case for
25 percent of his economic losses, they barred him from ever
borrowing money from USDA.
These issues are discriminatory, and if not addressed, you
and I will witness the extinction of Black row crop farmers.
In 2020 the world changed, and we were and still are in
what is called a pandemic. Unfortunately, Black farmers have
been going through a pandemic for years. We have watched our
fellow Black farmers be forced out of business and lose their
land at far greater rates than our White neighbors.
Mr. Chairman, the National Black Growers Council is
committed to the cause, and is working with our corporate
partners, fellow farm advocacy groups, and the Department of
Agriculture to reverse the declining trend of Black farmers and
landowners across these United States.
Mr. Chairman, I was a college student in 1997, and watched
my father, John Boyd, and other Black farmers from across this
nation sit before legislators and policymakers to explain these
disparities that exist between Black and White farmers. Twenty-
four years later, I am sitting before you, echoing the same
tones and explaining to lawmakers about the inequities that
still exist. Too many Black farmers have died with their cry
for help falling on deaf ears. Mr. Chairman, I would hope and
pray that my children do not have to sit at this table 24 years
from now, still asking for you to right the wrongs on behalf of
Black farmers.
Mr. Chairman, for all the people who have been working on
policy and legislation to help right the wrongs for Black
farmers, I would like to leave them with these words of faith
found in Galatians 6:9: ``Let us not become weary of doing
good, for at the proper time, we will reap a harvest if we do
not give up.''
Thank you, Mr. Chairman.
[The prepared statement of Mr. Haynie follows:]
Prepared Statement of Philip J. Haynie III, Chairman, National Black
Growers Council, Burgess, VA
Chairman Scott, Ranking Member Thompson, and distinguished Members
of the Committee:
On behalf of the National Black Growers Council, thank you for the
opportunity to testify at this important hearing today.
The National Black Growers Council consists of multigenerational
producers who advocate for the interests of Black farmers in their
local communities, their states, and to the Federal Government. NBGC's
mission is simple: to improve the efficiency productivity and
sustainability of Black row crop farmers.
As members of NBGC, we own our farms and seek opportunities to
expand our operations. We strive to teach young men and women about the
virtues of farming, the importance of agriculture, and the commitment
it takes to be successful in the global business of agriculture.
The NBGC was organized to represent the unique needs of full-time
Black row crop farmers. We have formed partnerships with each other,
with majority farmers, with land-grant universities, with agricultural
companies and with USDA, because together, we all contribute to global
food security.
I am a fifth-generation farmer. I grew up working my family land
with my father and grandfather in eastern Virginia where we grow corn,
wheat and soybeans. I had a childhood dream of wanting to be a farmer.
I finished high school and studied agriculture in college. I graduated
with a Bachelor's of Science degree in Agricultural Economics from
Virginia Tech and chose to return to my family farming business.
While growing up on my family farm, as a kid I experienced two
fires, the first one burned up our farrowing barn and our sow herd was
lost. The second fire, burned up our equipment and a finishing barn.
After my father rented the largest tract of land in the county, he
experienced his equipment being shot up on that farm. We had to sleep
in the truck with a shotgun whenever we left equipment on that farm. No
convictions resulted from these cowardly acts; but I don't think the
perpetrators were Black.
The discrimination at USDA caused my parents to have an
unbelievable amount of stress when they were denied loans or were late
receiving operating money. This unnecessary stress was created by the
uncertainty of farming in that era, fueled by racism, and ultimately
caused the divorce of my parents. The discrimination by USDA caused a
lot of young Black people to not want to be a part of their family's
farms.
The discrimination caused irrevocable damage to Black families.
While in college, I learned from one of my white friends about the
beginning farmer loan program at USDA. My father and I went into my
local county office to inquire about the beginning farmer loan. The
county executive director in my local county office asked me why did I
want to farm. He told me that I was a bright young man with a good head
on my shoulders and that I should focus on finding a good job after
college. When I questioned why he didn't encourage my white high school
friend to get a job and offered him a farm loan but not me he got
upset. He asked me if I knew how much money my father owed the USDA?
When I replied no I did not he opened my father's file and showed me
all of my father's USDA loans. After doing that, he brandished my
father and I with a loaded hand gun that he had in his desk. This
incident has caused me to have nightmares about being shot in that FSA
office. He also told my father; he should sell his land to a white
farmer in the county and get a job at the local lumber company driving
a forklift. Mr. Chairman, this is not something that happened to my
forefathers, or something that I read in the history books. This
happened to me.
If I had not gone through that experience, I may not be able to
relate to other Black farmers and their stories of discrimination. But
this is my story. And this is why I am here to make sure no other young
Black man or woman has to go through that experience again. Mr.
Chairman some scars in life are irreversible and that is one that time
cannot fade away.
Today's hearing is an important step towards addressing a number of
longstanding problems that continue to plague Black farmers. These
chronic problems formulate the cumulative effects of being historically
denied and impact three critical areas of farm sustainability: income,
access to credit, and risk management.
With regard to income, annual subsidies paid to Black farmers are
significantly less than subsidies received by their White farming
neighbors. Current subsidy options, Agricultural Risk Coverage (ARC)
and Price Loss Coverage (PLC), are based primarily on the crops and
yields grown on from 1981-1985, a period of admitted racial
discrimination by USDA. Studies have shown that Black farmers receive
less than 20% of the per acre amounts paid to their White farming
neighbors. These inequities ultimately result in Black farmers being
less profitable, which impacts the second critical area, access to
credit.
This is especially true when commodity prices are low and subsidies
comprise a larger portion of farmers' income. The combined effects of
these inequities often result in Black farms being less productive and
having to rely on low-risk, low-reward enterprises. For example,
planting less profitable crops like soybeans, right beside our white
neighbors, because we lack the improvements like irrigation, land-
leveling and drainage that our white neighbors have who plant cotton,
rice and corn. Even when we can make improvements needed to break this
cycle, we face higher risks by only being able to obtain crop insurance
at average production histories that span 10 years. To address these
disparities, NBGC supports the following:
1. Provide credit needed to make improvements that would bring Black
farmers' land on par with the production potential of their
White neighbors;
2. Adjust Black farmers' subsidies to a level comparable to their
neighbors; and
3. Automatically adjust Black farmers' production history and
insurance coverage to an amount comparable to the farm's
potential after improvements are completed.
Finally, Mr. Chairman, I wanted to highlight the ongoing issue of
heirs' property rights impacting Black farmers. I mention this because
Heirs' property, land owned by two or more people, often with a common
ancestor who died without leaving a will, is the leading cause of
involuntary land loss among Black farmers.
As we at NBGC have said before, land is a farmer's most valuable
and productive asset. And yet, 60 percent of Black farmers today
produce on property that has been passed through their families for
generations without secure title. Without secure title, Black farmers
are unable to leverage the full value of their land, including
accessing Title I USDA programs. Black farmers have gone into local
USDA offices and have been told they cannot sign a farm up for program
participation because the farmer cannot provide all the signatures of
heirs on the property. They offer the white farmer the option to
provide a cash rent statement and not have to go through these
obstacles. We need a system where USDA will work with us where the
property is protected and benefits can be passed on to the operator.
In order to help address these outstanding issues, we and our
partners at John Deere and the Thurgood Marshall College Fund launched
the Legislation, Education, Advocacy, and Production Systems (or LEAP)
Coalition in September 2020. In cooperation with the Federation of
Southern Cooperatives and my colleague on this panel Mr. Blanding, the
LEAP Coalition brings awareness, expertise, and legal resources to help
Black and traditionally under-represented farmers gain clear title to
their land.
Specific activities the LEAP Coalition will support include:
Supporting legislation on Heirs' Property reform
Partnering in efforts to clearing title for Black farmers
Investing in Fellowships, Internships, and Agribusiness
career paths
Engaging in estate planning to prevent the further
proliferation of Heir's Property
Amplifying the work of The Federation of Southern
Cooperatives
Raising awareness regarding the issues and challenges
experienced by Black farmers
Providing education and training to support Long-term
Sustainability and Economic viability
After heir's property issues are cleared, NBGC plans to continue
working within our networks to bring this land to maximum productivity.
I want to thank our sustaining members for their support of this
legislation and their continued commitment to help us achieve this
goal.
In closing, it is clear that much work remains to address
longstanding issues impacting Black farmers. We look forward to working
with you and the Committee to address these issues moving forward, and
I look forward to your questions.
The Chairman. Thank you very much, Mr. Haynie, for your
excellent, excellent report to us.
And now, I recognize Mr. Rowe. Please begin your testimony.
STATEMENT OF SEDRICK ROWE, OWNER/OPERATOR, ROWE ORGANIC FARMS
LLC, ALBANY, GA
Mr. Rowe. Thank you for the opportunity to be able to be on
this call and be able to share my testimony. My name is Sedrick
Rowe. I am a young farmer from south Georgia. I do row crop and
I do also organic farming. I am a first generation farmer. I
have been farming for 4 years on my own. I had the opportunity
to graduate from a land-grant institution that also taught me a
little bit more about farming, and my experience of it, nothing
has changed since the past. Hearing my granddaddy and older
people talk about farming back in the day and how they weren't
able to access land and equipment. I am going through that
personally myself.
I applied for beginning farmer programs, micro loans. The
reason I didn't get funded, I don't know. I have a legit reason
why I need the assistance, and also, the red flags are still
there because I'm giving them all of my information, all of my
life, just for them to tell me no again. It holds me back as a
farmer.
I see the effort we are doing to allocate monies for those
programs, but are those programs actually funding these farmers
or not? Are these farmers taking advantage of those programs?
We are not able to, because when you look at a Black farmer,
you are thinking small. That is why we are on that one percent,
two percent level. Speaking from my personal experience, it has
just been hard to even get into the market with peanuts. As you
know, peanuts are a commodity, and in order for you to grow
peanut--a commodity sells itself. So, as a Black farmer, I
can't just take my peanuts to any peanut mill, because they
will say oh, we are full. They will give me some excuse of why
they can't take my peanuts.
As a young farmer, I created my own avenue to create my own
market, organic peanuts. Something that I know large farmers
can't compete with. That is why I stepped into another market
like hemp. I started doing more organic and start work focusing
on the soil and the land, something that we always focused on
growing up. Take care of the land, the land will take care of
you. Coming from that era and having that mentality, even my
little small piece of land, it matters just like a larger
farmer.
I see, to this day, monies being allocated to help out
young and Black farmers, and socially disadvantaged farmers,
but, it comes with so much just for that farmer to access that
money. You look on the other hand, it is easy for them to
access money. They will tell you I qualify for it, but when I
get there, it is a whole other story. We need to change up who
qualifies and who doesn't. A lot of the Black farmers miss out
on the opportunity to keep the land in their family name, so
they are forced to go get a loan from the government, which
nine times out of ten, brings them into more debt, because
everyone knows farming is a risk. Every year is not a
profitable year. Farmers like me will look, in order for me to
feel like the government is giving me the right assistance, it
is funny how we have a pandemic, and during the pandemic you
have other banks and all that that have forgiveness on their
loans, but government, USDA had loans out allocated for these
farmers, but you never gave them the option for forgiveness so
their family can keep their land in their name. Something to be
able to show--with forgiveness, you have to show what you are
doing, show how you--at this one step, how it bettered you--to
the next step. I feel like we need to take more steps and the
people at the top need to focus more on the people at the
bottom.
Just to lead with a scenario that--something that I always
used to tell people. The important person in the building is
the janitor. We as Black farmers are janitors. The top person
can be the principal or the President. If the President is not
too attentive, it is not a good structure. We need to make sure
we build that structure from the top all the way to the bottom
to the farmers. The people that are allocating this money need
to know exactly who is using it, why they are using it, who
really needs it. And I think there is a separation in between
there, because it is different saying, ``Yes, we put money out
there for you,'' but when we are not able to access it, it is
more like saying, ``Well, we put it there. It is up to you to
get it.'' That is not hope. That is not giving a farmer or a
Black farmer any hope to be able to continue to hold on to what
they had in their family.
So, that was just some personal stuff that I have been
through that I can still see that hasn't changed within the
system.
[The prepared statement of Mr. Rowe follows:]
Prepared Statement of Sedrick Rowe, Owner/Operator, Rowe Organic Farms
LLC, Albany, GA
My name is Sedrick Rowe. I am a young Black first generation
farmer. I have a Bachelors Degree in Plant Science with a concentration
Horticulture and a Masters of Public Health with a concentration in
Environmental Health. I own a 30 acre organic farm where I grow
peanuts, watermelons, sunflowers, and hemp. I was one of the first
three farmers in my area to establish a market for organic peanuts and
I am a founding member of the Georgia Organic Peanut Association. I
have been involved in agriculture all of my life and that experience
continues to show me what it takes to develop a successful farm
business. Unfortunately, I did not inherit land, so I built my farm
from the ground up by purchasing land. I have seen and experienced
racism and discrimination within the agricultural system, as have so
many other Black seasoned as well as young farmers. My experience has
allowed me to witness firsthand, the difficulties Black farmers have
when attempting to access funds from the United States Department of
Agriculture. I personally have been unable to access those funds while
watching my white counterparts having little, if any, problem doing so.
I have applied for micro-loans as well as Beginning Farmers Assistance
and was denied: reasons given included insufficient collateral, market
contracts were insufficient and tax returns for the previous year did
not show enough income to pay the loan. It is extremely difficult for a
beginning farmer to meet these criteria. Loan criteria has to be more
flexible and equitable--and should include a combination of loans and
grants.
Even when funds are supposedly put in place to assist Socially
Disadvantaged Farmers and Ranchers, the rules, regulations and
paperwork make them difficult to access, for example, farming history
and matching funds. Although FSA is supposed to be the ``go to'' agency
for farmers who are having difficulty securing loans from commercial or
other sources, it falls way short when it comes to Black farmers--again
this comes from personal experience.
Although I consider myself to be a successful young Black farmer,
it is difficult for me to convince others to join me if I cannot assure
them that if they do all of the right things, they will have the
backing of the USDA.
Although Black farmers make up a small percentage of all farmers,
they play a critical role in making sure that marginalized people and
communities throughout the Black Belt Region have access to healthy and
affordable food. We need to make sure they not only remain in business
but that their number increases.
Community organizations also need support as they are often the
only thing standing in the way to keep people like me from losing their
farms. I once worked with one organization (The Southwest Georgia
Project). I saw how these organizations advocated on behalf of farmers
of color and worked through the red tape when farmers could not do so
themselves. In many instances they helped mitigate the lack of trust
between the USDA and farmers of color. So their continued existence and
sustainability is critical.
In the end, it is the responsibility of the USDA to level the
playing field so that Black and other minority farmers can not only
survive, but also prosper.
Thank you.
The Chairman. All right. Thank you very much, Mr. Rowe, for
your very good and very informative testimony. Thank you.
And now, Mrs. Sherrod, we recognize you. Please begin now.
STATEMENT OF SHIRLEY SHERROD, EXECUTIVE DIRECTOR, SOUTHWEST
GEORGIA PROJECT FOR COMMUNITY
EDUCATION, INC., ALBANY, GA
Mrs. Sherrod. Thank you, Chairman Scott--can you hear--and
the Committee for inviting me to speak today.
I grew up on a farm and my life's work has been with
farmers and people in rural communities in the South. On a more
personal note, though, today, March 25, marks the 56th
anniversary of the death of my father, a farmer who was
murdered by a White farmer that the racist system failed to
prosecute. It is within this context that I dedicated my life
to help make this world more just and equitable for everyone.
For over 5 decades, I have worked with and on behalf of
farmers, especially Black farmers and the rural communities in
which they live. Although Black farmers share many of the
problems faced by all small farmers, their situation is
compounded by systemic racism within the USDA and other public
and private institutions that are supposed to serve all
farmers, no matter their race or agenda.
The USDA is assumed to be the source of last resort when
the private-sector falls short. Unfortunately, since its
inception, USDA itself has fallen short and failed to meet its
obligations to Black farmers. Regrettably, the USDA has been
the driving force behind the steady decline in the number of
Black farmers and Black-owned farmland. This loss has and
continues to have a domino effect throughout the Black Belt
region of America and beyond. Without productive land that
supports economic development, the region suffers from
inadequate education, lack of access to healthy and affordable
food, poor health outcomes, and brain drain, among other
things.
Now, the USDA did admit in the Pigford case that it has a
history of discrimination against Black farmers. That admission
and subsequent settlement did not bring about any systemic
changes and left in place many of the individuals who
perpetrated the racism and discrimination. In fact, to my
knowledge, I, a Black woman, am the only person ever fired by
the USDA for discrimination, a claim that was later disproven.
Although Pigford itself was historic and exposed the real USDA,
unfortunately because the government was so incalcitrant, over
90 percent of the farmers who prevailed in the lawsuit were not
made whole.
So, where do we go from here? We need to restore Section
2501. This policy was the brainchild of the Federation of
Southern Cooperatives nearly 3 decades ago. I was a staff
member of the Federation, and therefore, very familiar with all
the work and documentation that led to its passing as a
permanent part of the farm bill. Its original intent was to
provide farmers of color, especially Black farmers with
outreach and technical assistance, so they could better access
USDA services.
The second one, eliminate burdensome matching requirements.
Many USDA programs require a match that is out of reach for
most Black farmers. This is akin to a poll tax. It keeps the
benefit out of our hands.
Three, engage in real problem solving. Use the Georgia
Strike Force example as a model, and fully fund it. Invest in
1890s. 1890 universities are key to Black farmers' success.
Ensure that they are funded adequately--equitably, let's say.
Launch infrastructure fund, provide funds for Black farmers to
develop or improve processing facilities, secure
transportation, organize cooperatives, and more. Diversify the
staff. Mandate increasing diversity in USDA staff makeup. And
last, culture change. Staff culture flows from the culture of
the leaders. Secretary Vilsack should invest significant time
and effort into building a culture in which discrimination is
not tolerated, and is with the end in which dismantling of
systemic racism is rewarded.
Thank you so much for giving me this opportunity. These are
but a few things that we can begin to put in place today while
we wait on the fate of policies currently under consideration.
We must also understand that even if these policies are
approved, they only represent a down payment on what is owed to
Black farmers and their communities after more than a century
of neglect and discrimination.
Thank you.
[The prepared statement of Mrs. Sherrod follows:]
Prepared Statement of Shirley Sherrod, Executive Director, Southwest
Georgia Project for Community Education, Inc., Albany, GA
My name is Shirley Sherrod; I live in Albany, Georgia and currently
serve as the Executive Director of the Southwest Georgia Project for
Community Education, Inc. (SWGP). SWGP is a nonprofit organization that
was born out of the civil rights movement with a mission to educate,
engage and empower communities through grassroots organizing and
technical assistance.
On a more personal note, today March 25, marks the 56th anniversary
of the death of my father, a farmer who was murdered by a white farmer
that the racist system failed to prosecute. It is within this context
that I dedicated my life to help make this world more just and
equitable for everyone.
For over 5 decades, I have worked with and on behalf of farmers--
especially Black farmers--and the rural communities in which they live.
I also served under the Obama Administration as the first Black State
Director of Rural Development. My work has afforded me the opportunity
to help build coalitions that cross both state and international
borders. I have learned that small farmers throughout the world are
struggling to survive in an environment that overwhelmingly favors
large scale and corporate farms.
Although Black farmers share many of the problems faced by all
small farmers, their situation is compounded by systemic racism within
the USDA and other public and private institutions, that are supposed
to provide services to all farmers no matter their race or gender. The
USDA is assumed to be the source of last resort when the private-sector
falls short of its duties and responsibilities. Unfortunately, since
its inception, the USDA itself has fallen short and failed to meet its
obligations to Black farmers; regrettably, the USDA has been the
driving force behind the steady decline in the number of Black farmers
and Black owned farm land. This loss has and continues to have a domino
effect throughout the Black Belt Region of America and beyond. Without
productive land that supports economic development, the region suffers
from inadequate education, lack of access to healthy and affordable
food, poor health outcomes and brain drain among other things.
The USDA has been called the last plantation and for the most part
has worked relentlessly to live up to that reputation. Its efforts to
try and remedy the problem it caused, has generally fallen way short.
Those efforts are usually under-funded, short-lived, at the mercy of
changing Administrations and opposition from employees.
There has to be a long-term, well-resourced commitment at all
levels of the USDA if Black farmers are to remain part of America's
production agriculture system.
Although the USDA did admit in the Pigford case that it has a
history of discrimination against Black farmers, that admission and
subsequent settlement did not bring about any systemic changes and left
in place many of the individuals who perpetuated the racism and
discrimination. In fact, to my knowledge, I (a Back woman) am the only
person ever fired by the USDA for discrimination, a claim that was
later disproven. Although Pigford itself was historic and exposed the
``real USDA'', unfortunately because the government was so
incalcitrant, over 90 percent of the farmers who prevailed in the
lawsuit were not made whole.
The question is ``where do we go from here?''
There are two game changing policies (Justice for Black Farmers Act
and the recently passed Emergency Relief for Farmers of Color Act) that
could address some of the past and current problems faced by Black
farmers and the communities in which they live. History has shown that
good legislation often dies or is weakened in the regulatory and
implementation process. While we wait for the outcome of the two
policies, there are things that can be done now to help struggling
Black farmers and communities.
Following are a few commonsense examples:
Too often USDA uses regulations to hinder rather than help
Black farmers such as the Value-Added Producer Program which
requires matching funds as well as certain NRCS grants. Also
constant changes in the Section 2501 program--changes that are
making it less [accessible] for the groups it was originally
intended for.
Return section 2501 to its original intent. This policy was
the brainchild of the Federation of Southern Cooperatives/Land
Assistance Fund (FSC/LAF) nearly 3 decades ago. I was a staff
member of the FSC/LAF and therefore very familiar with all the
work and documentation that led to its passing as a permanent
part of the farm bill. Its original intent was to provide
farmers of color (especially Black farmers) with outreach and
technical assistance so that they could better access USDA and
other services as they work to develop successful farm
businesses. That assistance would be provided by experienced
community organization and minority serving universities.
Unfortunately, 2501 has become a catchall for almost any small
farm program such as beginning farmers and veteran farmers.
These farmers are important and deserve a separate program to
meet their needs while 2501 should return to its original
intent and be fully funded.
Many of the resources within the USDA cannot be accessed by
Black farmers and community-based organizations; the reason
being that they cannot meet the matching requirement or other
restrictive rules such as having to collaborate and work with
other community-based organizations across state lines. These
requirements should be eliminated and funds provided solely on
the merits of the farmers or CBO's business plan or program
respectively.
The USDA's now dormant Strike Force program was based on a
program I instituted while serving as Georgia State Director of
Rural Development. It brought together all agencies within the
USDA to analyze problems and employed a holistic approach to
solving those problems. The program enjoyed mild success and
could have had tremendous success had funds been earmarked
especially for it. That program should be revisited by the
Secretary of Agriculture.
While I cannot speak for 1890 Universities, I will say that
they play a key role in the survival of Black farmers and rural
communities. There needs to be more equitable funding for these
universities.
Black farmers need to be able to market their products and
not be limited to any one market; they have to be able to
diversify their markets. To do this, they need the necessary
infrastructure. There needs to be a Black farmer infrastructure
fund that will allow farmers to develop and/or improve
processing facilities, secure appropriate transportation,
organize cooperatives, etc.
There has to be diversity within the various USDA state
offices and everyone in those offices should be held
accountable.
The USDA can only stop being the ``last plantation'' when
the culture within the Department changes.
These are but a few of the things we can begin to put in place
today while we wait on the fate of policies currently under
consideration. We must also understand that even if these policies are
approved, they only represent a down payment of what is owed to Black
farmers and their communities after more than a century of neglect and
discrimination.
The Chairman. Thank you so much for your testimony, Mrs.
Sherrod. We are learning so much here, and the purpose of this
hearing is we are putting together a bill, a piece of
legislation to address and come out. Rest assured that your
testimony, your ideas are not in vain, because we are putting
together Black farmers and a piece of legislation to bring
this. So, this is just the beginning. Thank you all so very
much.
And now, we have, I believe, Mrs. Cotton. Mrs. Cotton,
would you begin your testimony?
Mrs. Cotton, you may want to unmute.
Mrs. Cotton. Chairman Scott?
The Chairman. Yes.
STATEMENT OF ARNETTA COTTON, CO-OWNER AND PROGRAM FACILITATOR,
KINGDOM COMMUNITY DEVELOPMENT
SERVICES, WAGONER, OK; ACCOMPANIED BY EARRAK
COTTON, OWNER, CATTLE FOR THE KINGDOM
Mrs. Cotton. Chairman Scott, Ranking Member Thompson, and
distinguished Members of the Committee, we would like to
begin--can you see me? Can you hear me?
The Chairman. Yes, go right ahead. We can hear and see you.
Mrs. Cotton. Okay.
Chairman Scott, Ranking Member Thompson, and distinguished
Members of the Committee, we would like to begin by thanking
you and God for the privilege and honor of testifying in this
hearing. It is our hope that something said or done will result
in greater understanding, reconciliation, and change.
Thank you, Representative Tracey Mann, for our
introduction.
Little children across the United States who grew up
watching their parents passionately work the land through
torrential rains, incessant droughts, troublesome pestilence,
and extreme poverty were often consumed by the idea that one
day, this land will be mine. Somewhere between working behind
the plow for several hours at a time in the blazing sun for
days on end to get the crops in and out, and the rare
opportunities to reward themselves with a soda or an ice cream,
they developed an insatiable obsession with nature. However, to
be Black and possess that type of intensity towards the Earth
in the United States at a young age can accurately be compared
to someone laboring under the sweltering sun in a desert
towards something that appears to be real, but in fact, is an
optical illusion. Over time, as the mirage steadily relocates,
the child matures to adulthood. What remains is a diminutive
essence of potential. Yet, despite years of imagining, the
slightest scent of possibility is all that is required to
stimulate hope in the heart of a Black farmer.
We felt that hope. So, when at the age of 24 and married
less than 5 years with two baby girls, we were advised that the
then-FmHA was an agency that existed to assist young and
beginning farmers, especially minorities. We thought we would
be welcomed with open arms. Instead, when we stepped into our
county FmHA office in 1984, the secretary looked up and
continued working without ever acknowledging our presence.
``Ma'am, is this the FmHA,'' we asked. ``Yes,'' she answered,
never moving from her desk. An unwelcoming aura and
overwhelming strangeness filled the room. Without ever a word
spoken, its presence seemed to demand that we simply turn
around and leave. But we didn't. The county supervisor's tenure
could not be denied, but neither could his unorthodox practices
and forgetfulness. We had meetings at his home. Our file was
lost and misplaced several times. Some years later, our initial
contact transitioned out of his role, and we were buried under
the transition of powers. For example, on several occasions,
the FmHA contractor and Langston University representatives
reworked our farm plan on the same application, and they
concluded we had good records. Our cattle were in excellent
condition, and that was an average production and some non-farm
income, the plan was feasible. Yet despite their findings, the
county committee rebutted that they were not comfortable with
our abilities, that the entire application should be changed.
And since we could not effectively explain the reworked plan,
we could not possibly implement them with any degree of
success. All of our alternative plans were repeatedly denied,
but no viable plan for success was ever offered.
Were it not for the elders who had a keen eye for
identifying those whose work ethics and moral compass and
instinctive cunning were perfectly suited for the land, they
would have become extinct. Thankfully, one such elder offered
her wisdom and trust to us, so we appealed the decision of the
county supervisor. We appealed, and the decision was
overturned.
But despite it overturning, the FSA office said maybe we
should go ahead and let the applicant know that further
information is needed. The county supervisor told us that we
needed to get our property appraised, and he selected the
appraiser. Coincidentally, that appraiser appraised our
property for less than it was valued for a year earlier. And
despite winning our appeal, we lost the denial of our
application.
It was not our county office who told us about the
designation and how language was expressly written to extend
help to socially disadvantaged people. A friend helped us to
navigate through this system. We went to USDA in Washington,
D.C., and met with several officials. These consultations
resulted in our first community meeting. There were over 100
people there in 4" of rain. We partnered with Langston
University.
Let me just skip down to this, if you would, please, Mr.
Chairman.
One of the reasons that local churches and faith-based
organizations are the backbone in communities and the F2F
Program is because people trust them. We serve from hearts of
love with boots on the ground. It is the same spirit that we
really--we humbly ask this Committee----
The Chairman. I am sorry.
Mrs. Cotton. Let me say this. May I please? May I say this?
The Chairman. I am going to----
Mrs. Cotton. We have faith in God who created one race of
people, the human race, and who created the Earth, the one on
which we exist together, and the heavens, the ones that we
continue to explore. We believe that He gave us the ability in
Him to equitably dwell together in peace, harmony, and love, to
preserve this beautiful land.
[The prepared statement of Mrs. Cotton follows:]
Prepared Statement of Arnetta Cotton, Co-Owner and Program Facilitator,
Kingdom Community Development Services, Wagoner, OK
Chairman Scott, Ranking Member Thompson, and distinguished Members
of the Committee, we would like to begin by thanking you and God for
the privilege and honor of testifying in this hearing. It is our hope
that something said or done will result in greater understanding,
reconciliation, and change.
We are Earrak and Arnetta Cotton of Oklahoma, and we have more than
54 years of farm and ranch experience and 39 years of farm and ranch
management experience as the owners of Cattle For The Kingdom (CFTK).
Earrak is retired from a 30 year career service with State Farm
Insurance and now serves as the head pastor of Unity Temple Family
Church in Inola, Oklahoma--a body of Believers that started more than
100 years ago. He also serves on the U.S. Department of Agriculture
Natural Resources Conservation Services (NRCS) State Technical
Committee in Oklahoma. Arnetta currently serves as the Program
Facilitator for Kingdom Community Development Services, the Rural
Impact Food Pantry, and the Agricultural in Action Program which
includes a market gardening school and farm training program in
conjunction with Langston University--the 1890 Land-Grant University in
Oklahoma, and Oklahoma State University--the 1862 land-grant in the
state. She was also appointed by Secretary Sonny Perdue to serve on the
USDA Minority Farmers Advisory Committee.
Little children across the United States who grew up watching their
parents passionately work the land through torrential rains, incessant
droughts, troublesome pestilence, and extreme poverty were often
consumed by the idea, ``One day this land will be mine.'' Somewhere
between working behind a plow for several hours at a time in the
blazing sun for days on end to get the crops in and out, and the rare
opportunities to reward themselves with a soda or ice cream, they
developed an insatiable obsession with nature.
However, to be Black and possess that type of intensity towards the
[E]arth in the United States at a young age can accurately be compared
to somebody laboring under the sweltering sun in a desert towards
something that appears to be real; but, in fact, is nothing more than
an optical illusion. Over time, as the mirage steadily relocates, the
child matures to adulthood. What remains is the diminutive essence of
potential. Yet despite years of imagining, the slightest scent of
possibility is all that is required to stimulate hope in the heart of a
Black farmer.
We felt that hope. So, when at the age of 24 and married less than
5 years with two baby girls, we were advised that the then Farmers Home
Administration (FmHA) was an agency that existed to assist young and
beginning farmers, especially minorities, we thought we would be
welcomed with open arms. Instead, when we first stepped in our county
FmHA office in 1984, the secretary looked up then continued working
without ever acknowledging our presence.
``Ma'am, is this the FmHA?'' We asked.
``Yes,'' she answered, never moving from her desk.
An unwelcoming aura and overwhelming strangeness filled the room.
Without a word ever spoken, its presence seemed to demand that we
simply turn around and leave; but we didn't.
The County Supervisor's tenure could not be denied, but neither
could his unorthodox practices and forgetfulness. We had meetings at
his home, and our file was lost and misplaced several times. Some years
later, as our initial contact transitioned out of his role, we were
buried under the transition of powers. For example, on separate
occasions an FmHA contractor and Langston University representative
reworked our farm plan on the same application and concluded we had
good records, our cattle were in excellent condition, and that with an
average production and some non-farm income, our plan was feasible. Yet
despite their findings, the County Committee rebutted that they were
not comfortable with our abilities, that the entire application should
be changed, and that since we could not effectively explain the
reworked plans, we could not possibly implement them with any degree of
success. All our alternative plans and approaches were repeatedly
denied, but no viable plan for success was ever offered.
Our calls were avoided, refused, or forwarded to oblivion; we were
required to travel to various USDA offices, restaurants and even ball
parks for any chance to discuss the issue; our meetings were canceled
and rescheduled without notice; and unofficial County Committee
meetings took place where official decisions were made on our
application without having a completed application to review.
Often, these experiences were witnessed by our four children.
Were it not for the Elders who had a keen eye for identifying those
whose work ethics, moral compass, and instinctive cunning were
perfectly suited for survival, far more Black farmers would have become
extinct. Thankfully, these strategic leaders (though few in number)
persevered through insurmountable odds and outlasted personal assaults
to maintain some semblance of dignity as they paid for their land one
penny at a time.
Often, when the stage was properly set and everything was
synchronized for change, they would test the waters by leasing a
portion of their land to a competent, but less experienced person of
color whom they could mentor through the process. The eventual glimmer
in their eyes served as witness of their approval. While their wisdom
was readily available, they understood for the fledgling farmer to
establish a faithful relationship with the land, they had to learn
about her incalculable nuances for themselves. This search for intimacy
would inevitably rekindle a desire in the Black farmer to own their own
property. One such Elder offered her wisdom to and trust in us.
So, we appealed the decision of the County Supervisor. We appealed
because of the unjustifiable dragging out of our application process;
the deteriorated condition of our home; and the intentional and
persistent prodding and provocation we experienced. In 1994, the
decision to deny us was overturned, and the state Farm Service Agency
(FSA) office advised that the best course of action would be to proceed
with the application and to let the applicant know what further
information was needed.
The County Supervisor told us we only needed to have the property
appraised, and he secured an appraisal service. Conveniently, the
appraiser the County Supervisor secured valued the property for far
less than its original worth only a year earlier. Despite winning our
appeal, our request was ultimately denied based on the appraisal.
You may not know this, but the term ``underserved farmer''
originated from eight Black farmers in West Central Oklahoma who
submitted a court brief in Pigford v. Glickman. The designation is
meant to address the unique circumstances and concerns of underserved
farmers, including Black farmers, and focus on equity in accessing USDA
programs and services. The term has been used to initiate a wide
variety of programs and resources at USDA, including grants and loans
and scholarship opportunities for students studying agriculture at 1890
and 1994 land-grant universities.
It was not our county office who told us about this designation and
how the language was expressly written to extend help to socially
disadvantaged farmers like us. They did not tell us this when we were
initially denied, when we were denied for the second time, or even
after we were instructed to get an appraisal. It was a friend, who like
us had experienced more than 35 years of extreme racial and
programmatic discrimination at the hands of others.
That friend helped us navigate the system. He introduced us to key
contacts at USDA including then Oklahoma state directors, Gary O'Neill
at NRCS, Dr. Lee Denny at Rural Development, and Scott Biggs at FSA as
well as Mike Beatty and Jacqueline Davis-Slay at USDA's Office of
Partnerships of Public Engagement (OPPE). In fact, it was at a USDA
OPPE Faith Fellows Training in Washington, D.C. where we learned about
developing and maintaining partnerships focused on solutions to
challenges facing rural and underserved communities like ours. Our
friend also helped us learn that we could utilize programs from all
USDA arms to solve the issues that have plagued us for nearly 40 years
and other Black farmers for centuries. In fact, we could utilize
community facility loans for our nonprofit community organization; farm
labor housing programs; water and sewer grants; and more.
Those consultations resulted in our first community outreach
meeting at the church we lead. We were able to share the information we
had learned with more than 100 people who came to learn about USDA
resources during a deluge of 4" of rain.
Because of our new knowledge of USDA programs and partnerships
stemming from our various community outreaches, we have also:
Partnered with Langston University to host an 8 month
Marketing Garden School including an active garden throughout
the growing season that supported our local Farmers Market;
Distributed Farmers to Families Food Boxes to more than a
million people through all five phases in Oklahoma, Kansas,
Missouri, Texas, and Arkansas;
Distributed 500 turkeys at Thanksgiving last year thanks to
our partnership with IRUSA;
Purchase equipment, supplies, and materials necessary to
bring our pantry up to code thanks to Cherokee Nation;
Earrak became Oklahoma's first African Native American by
card to serve on the NRCS Oklahoma State Technical Committee;
and
Arnetta was selected by then Secretary Sonny Perdue to serve
on the USDA Minority Farmers Advisory Committee.
One of the reasons local churches and faith-based organizations are
the backbone in communities and the F2F program is because people trust
them. We serve from hearts of love with boots on the ground. It is in
this same [spirit] that we rally the cause for other Black farmers. We
forward information we receive to area farmers and other interested
parties. We take calls. We provide information. We instruct and
advocate. That mentality should prevail when working with and
conducting outreach to Black farmers.
We can no longer afford to shroud the lack of follow-through
business with Black Farmers in the busyness of meetings about Black
Farmers. We should not only come with business cards, but also with
applications prepared to give our time not just our contact
information. We should go to whatever lengths necessary to provide
thorough and complete information and assistance. There is still much
work to be done, and we are committed to helping achieve this goal.
We humbly ask this Committee to consider implementing a Pilot
Program with HBCU's Outreach Programs in cooperation with active Black
Community Based Organizations to implement comprehensive training
programs on behalf of USDA to underserved farmers in how to complete a
Whole Farm Plan with subsequent technical and practical support.
Additionally, we ask that you consider offer training and compensation
for non-governmental Black farmers to conduct community outreach
meetings for USDA, FSA, NRCS and RD. This would, in turn, bolster
confidence, participation and stimulate new interest in USDA programs.
Just as we have faith in God who created one race of people--the
human race; one [E]arth--the one on which we dwell together; and the
heavens, which we continue to explore, we earnestly believe He gave us
the ability in Him to equitably dwell together in peace, harmony and
love in order to preserve it all.
Thank you again, and we look forward to your questions.
The Chairman. Thank you, thank you, thank you.
I tell you what, fantastic and very informative, and very
impressive testimony that we have heard from our distinguished
panelists, all of our Black farmers here. It has been
tremendous and very helpful. And from our Secretary as well.
And now, we are going to now proceed to getting questions
from us Members. I am going to start, then the Ranking Member,
and then we are going to go with each of our Members on the
Committee, alternating between Democrats and Republicans.
And first of all, let me start with this question, if I
may. I recognize myself for 5 minutes, and I will be held to
that to be sure to set the proper example. I hope everybody
heard me there.
Secretary Vilsack, again, let me thank you for coming. But
I want you to clear up for us, if we have this--can you hear
me, Secretary?
Secretary Vilsack. Yes, sir.
The Chairman. Good. We have just passed the American Rescue
Plan Act of 2021 in which we had a total of right at $5 billion
to get to our Black farmers.
First of all, $4 billion of it was for the loan
forgiveness. Now, tell me what are the instructions for how our
farmers can make sure they get access to that money? How long
will it take, and will there be some cumbersome bureaucracy in
the way of them getting it, first of all?
Second of all, is it true that this money for the loan
forgiveness that our Black farmers will be getting will be
subject to taxation, that the IRS will count it as income, and
then they got another bill to pay? Clear up the entire
disposition, and let's get it plain how we can make sure that
this big hit we are giving to help our farmers get right to
them quickly, immediately.
Secretary Vilsack. Mr. Chairman, the instructions, first
and foremost, is to do this as quickly, as thoughtfully, and
carefully as possible. Two types of loans we are dealing with,
direct loans and guaranteed loans.
Let me deal with the direct loans first. To the extent that
it is a relatively simple, straightforward loan, we are going
to try to get this--these done sort of in a tiered circumstance
situation as quickly as possible. One hundred twenty percent,
basically, the loan gets paid off. Twenty percent goes to the
farmer. Now, farmers are going to have to think about this
because to your question on taxation----
The Chairman. Well, wait just a minute. You say of the
amount, 20 percent goes to the farmer?
Secretary Vilsack. Twenty percent goes to the farmer for
the purpose of paying the tax.
The Chairman. Good. Thank you.
Secretary Vilsack. But, farmers need to think about this,
Mr. Chairman, because depending upon the size of the loan, the
tax issue may be so that you may want to divide potentially the
forgiveness of the loan over more than 1 tax year in order to
minimize your tax liability. That is why it is going to be
necessary for us to use a portion of the money from Section
1006 to provide outreach, technical assistance, and advice so
the people can make the best decision for their farm so they
don't find themselves in a deeper hole when this is all said
and done.
On the guaranteed loan side, remember, we are dealing with
banks where we have essentially guaranteed the loan. And we
have sent a letter today to those banks, basically indicating
that they are to take no further action whatsoever to foreclose
on farmers; that we are going to work with them to get these
loans paid off. Now, a question is going to come up if there is
a prepayment penalty. There may be a prepayment penalty in that
loan. We are going to ask for documentation of that prepayment
penalty, and we are going to try to figure out how to deal with
that. I don't have an answer today. I just know that it is an
issue that we are going to have to confront and think about.
And some of these guaranteed loans themselves have been
sold by the bank, which makes a bit of a complication. But at
the end of the day, this whole purpose is to try to get this
done as quickly as possible, as effectively as possible, and to
provide farmers enough information and outreach so they can
make informed decisions about their direct loan and the tax
implications, and we can settle up their guaranteed loan
without any further disruption.
The Chairman. Now, very quickly, Mr. Secretary, how much of
your time personally will be devoted to getting the full $5
billion out to our Black farmers? How much time will you be
putting in to that, because I believe if you have that as your
top agenda, it will speed the process down the line. Because
you are working it out. There are problems here. Go ahead.
Secretary Vilsack. I don't have any doubt that my staff
understands that this is the top of my list in terms of
priorities. The whole equity issue, the whole equity effort is
at the top of the list in terms of time that we will spend
collectively as a team focused on all of these issues, and
specifically with the debt relief portion of it.
The Chairman. All right, thank you. I will bring the gavel
down on myself here.
I now recognize the distinguished Ranking Member, the
gentleman from Pennsylvania, Mr. Thompson, for 5 minutes.
Mr. Thompson. Mr. Chairman, thank you so much.
First of all, thank you. Thank you for the compelling
testimony, to each of the witnesses today, your verbal
testimony, and quite frankly, your written testimony that you
provided us.
I want to reach out to Pastor and Mrs. Cotton, and say
thank you so much for your ministry and how you have really
focused all aspects of your ministry, as I have gone through
your testimony. What a blessing. What a blessing. All the work
that you do, really, and now you are bringing glory and honor
to God in your work. It is much appreciated.
In your testimony, you mentioned USDA's Office of
Partnerships and Public Engagement. Can you elaborate more on
your experience with the Faith Fellows training that you
attended in Washington, and how that experience contributed to
your interactions with the USDA?
Mrs. Cotton. Absolutely. It was during that Faith Fellows
training, and it was the inaugural training that nearly every
department within the USDA was present. Not only did they give
individual presentations to the entire group, but by the end of
the 5th day, we all gathered into an auditorium in sections,
and we could go to those different departments individually to
ask questions, and they were able to answer those questions. As
a result, we stayed in contact with them. As we began to
implement the instructions that they had given us and the
different suggestions that they had given, we began to
implement it. We became a 501(c)(3) for a community outreach
organization. We partnered with land-grant universities, both
Langston University and OSU. We partnered with Convoy of Hope,
and other things. But this was as a result. Even Islamic Relief
USA, we were able to partner with them as a result.
When we had questions that could not be answered on the
local level, we could reach out to those people in D.C. And all
of that was as a result of OPPE.
Even when information conflicted from here to there, they
would get involved and help us to resolve. We began to have
community outreach meetings. We have had, I believe, six to
date. We partnered with NRCS. We entered into the Conservation
Program. And everyone who attends our program, as information
is forwarded to us, we forward that information on to them. We
field telephone calls, answer questions. And then we attend
every single meeting that we can on our local, district, state,
and national level regarding all of these different entities.
So, we are busy beavers.
Mr. Thompson. Yes, you are very busy. Thank you for what
you do. It sounds like it is very successful, those
partnerships, that collaboration.
Based on your experience so far into this, we always look
for opportunities, even when we are getting things right. We
always try to do better, right? I think we are called to do
that.
Mrs. Cotton. Yes, sir.
Mr. Thompson. Are there any lessons you have learned so far
on improvements you would recommend on how we could continue to
develop and maintain those partnerships with Black farmers and
other socially disadvantaged farmers?
Mrs. Cotton. Definitely. In most of the community outreach
meetings, they are conducted by governmental employees and they
are basically saying the same thing. They come in--I have
likened it to a USDA infomercial group, because they say
basically the same thing.
If other non-governmental employees with organizations who
have proven records, who maybe possibly could even be trained
by the government to have--they have a certain trust level that
is garnered with communities of color and people of color. If
those outreaches could be conducted by them in partnership with
land-grant universities, in partnership with active Black
organizations, farming organizations such as the Oklahoma Black
Historical Society, and even our own group, to put out these
community outreach meetings, and then follow through. Because I
understand that in the USDA, many of the organizations have
been compiled, joined in, so there are less bodies out in the
field, and that strain on the local employees is felt with the
local farmer. We believe that if some sort of pilot program
could be implemented to help us to be your feet on the ground
in order to get this information out. We have proven these
organizations that I have named, including USDA--Langston and
OSU, they have a good proven record.
Mr. Thompson. Very effective.
Well, thank you, Mrs. Cotton and thank you, Mr. Chairman,
and I yield back.
The Chairman. Thank you, Ranking Member Thompson. I
appreciate that.
I now recognize the gentleman from California, Mr. Costa,
for 5 minutes.
Mr. Costa. Thank you very much, Mr. Chairman, for this
historic hearing with the Agriculture Committee and it is good
to see you, Secretary Vilsack, my friend. And for all your
years of service to our country and your commitment today to
root out racism and discrimination that has been historic, as
noted by the testimony. What terrific testimony our witnesses
have provided, and suggestions and advice for legislation that,
as the Chairman indicated, we will act on.
In preparation for this hearing, I asked a constituent of
mine, Mr. Will Scott, President of the African American Farmers
of California, to provide some testimony, which, Mr. Chairman,
I ask unanimous consent to submit for the record.
[The statement referred to is located on p. 322.]
Mr. Costa. In his testimony, he details a history of
discrimination from loan denials, as has been stated in the
testimony earlier, to unequal access to markets, which is a
problem. But I wanted to realign what really stood out to me.
Mr. Will Scott, a third-generation farmer like myself and our
family, he said ``Members of the African American Farmers of
California are fearful to apply for any loans from the USDA and
do not want to deal with government, as they fear they will
lose everything they have.'' That is a sad commentary.
We all know that farmers are risk takers, but when you have
to deal with the discrimination that African American farmers
and other minority farmers have had to deal with, it makes the
risk taking all that greater. It is clear today from the
history of discrimination at the USDA that there is still an
impact.
I remember Secretary Vilsack talking to President Obama--
and I shared this with John Boyd the other day--that I told
him--President Obama, I said, ``Farmers are risk takers, but
they are also price takers, not price makers.'' And President
Obama is a very smart guy, but he is from the city. He said,
``Price takers, not price makers. What do you mean?'' I said,
``When you put all this investment every year into your crop,
and then at the end of the year you get whatever the price
is.'' He says, ``I never thought about it that way. Price
takers, not price makers.''
Mr. Secretary, it is critical that you work to provide and
rebuild trust with Black and other socially disadvantaged
farmers so that American agriculture can better reflect the
diversity in our country, and our minority populations. In my
own district, USDA has indicated that we have 14 African
American farmers, over 76 Native American farmers, 771 Asian
farmers, many Pacific Asian farmers, over 1,000 Hispanic
farmers, and over 5,600 Caucasian White farmers. It is
important to note that out because discrimination is not only
for African American farmers, but Southeast Asian farmers in my
district. It is estimated that approximately over the 1,000
Southeast Asian farmers in the Central Valley, many of them
Hmong that settled after the Vietnam War, the USDA aid has not
been there for them. I would like to submit testimony from the
Asian Pacific Institute of Resources in Fresno, Blong Xiong is
the Chair of that, detailing the shortcomings on providing
support for those farmers. And I ask unanimous consent to
submit that testimony as well, Mr. Chairman.
[The statement referred to is located on p. 323.]
Mr. Costa. Mr. Secretary, one of the barriers to access at
the USDA programs by Black farmers and Southeast Asian farmers,
Latino farmers in my district seems to be complicated and
burdensome applications to requirements and the backlog of the
local Farm Service Agency offices, FSA. Sanford Bishop, my
colleague--and he is a cardinal and chairs the Subcommittee on
this--and I have talked about it.
As part of your efforts to get more aid to socially
disadvantaged farmers, can you commit to ensuring that local
FSA offices are properly staffed with the diversity reflected
by the farmers they serve and have language capabilities?
Secretary Vilsack. Yes.
Mr. Costa. That is so important. The previous
Administration, we complained that there wasn't sufficient
support in these FSA offices. The testimony we have heard
already today has indicated that as such. You are going to have
to focus that, not only for the American Rescue Plan, but to
really expedite the support for this. We have a backlog in CFAP
1 of over 4 months already in my own district.
Secretary Vilsack. Representative, I think there are
several things to this.
First, we have to cast a wider net for people to work in
these local offices. Second, as has been mentioned earlier, we
need more partnerships and more connections with community
building organizations that can assist us. As has been
indicated, there is a trust issue that needs to be addressed.
Mr. Costa. My time is going to expire, but Mr. Chairman, I
want to submit a third level of testimony. A staff member,
Major Henry Munoz, who has just retired and is going to go to
work for me, dedicated outreach to listen to stories needed for
socially disadvantaged farmers in my district. I would like to
submit his report for the record.
[The report referred to is located on p. 318.]
The Chairman. The time of the gentleman has expired there.
Thank you.
Mr. Costa. I want to submit the testimony. Is that
possible?
The Chairman. Yes, that is possible. Thank you. We will
take it.
Mr. Costa. Mr. Chairman, I would like you to look at it and
I will share it with you. Thank you very much, Mr. Chairman.
The Chairman. You are quite welcome. Thank you, Mr. Costa.
And now, I recognize the gentleman from Georgia, Mr. Austin
Scott, for 5 minutes.
Mr. Austin Scott of Georgia. Thank you, Mr. Chairman, and
Mrs. Sherrod, Mr. Blanding, and Mr. Rowe are from right down
the road from where I am. I actually live in Tifton, Georgia.
Mrs. Sherrod, I don't have a question for you, but I am
very familiar with what happened to you where somebody changed
the context of what you said and you lost your job because of
that, in 2010, and I am glad you won that suit against that
news organization that ran that false article. I heard what you
said and I saw what they reported, and I thought they very much
changed the context.
Mr. Blanding, I think you are very much right about the
heirs-related issue. I think that is something that we can work
on together that has happened, and I hope that some of the
money that has come through the recent legislation will help
with that.
Mr. Rowe, you are obviously a young farmer in Albany,
Georgia, and I am right down the road in Tifton. If I can ever
help you please feel free to reach out to us.
Mr. Boyd, I certainly enjoyed my conversation with you and
your wife the other day, and as I mentioned to you, to me, some
of the challenges of the African American farmers, they are not
limited to African American farmers. It is pretty much all of
our small farmers, beginning farmers, and I hope as we go
forward, we are able to look at young, beginning, small,
regardless of race with regard to how we handle things at the
USDA, because there are a lot of people out there that need
help, and we need more farmers, not fewer farmers in the United
States.
I told you this, Mr. Boyd. I don't have a question for you,
but I do have an issue with the language in Section 1005,
Secretary Vilsack. Can you tell me, Secretary Vilsack, were all
of the socially disadvantaged farmers included in the relief
provided in Section 1005?
Secretary Vilsack. If you are defining socially
disadvantaged farmers as consistent with the 1990 Act, yes,
which is based on race and ethnicity. There are other
definitions----
Mr. Austin Scott of Georgia. The current definition of a
socially disadvantaged farmer, can you tell me who is excluded
from Section 1005 versus the current definition of a socially
disadvantaged-farmer?
Secretary Vilsack. I want to make sure I understand your
question, Congressman. Are you asking me does the provisions of
the American Rescue Plan Act of 2021 define socially
disadvantaged, or are you referring to some other definition of
socially disadvantaged?
Mr. Austin Scott of Georgia. Secretary Vilsack, the current
definition, what I am getting at. You are wasting time. The
current definition of a socially disadvantaged farmer, which
farmers that are currently eligible for the socially
disadvantaged farmer loans are not eligible for the relief
under Section 1005?
Secretary Vilsack. White women.
Mr. Austin Scott of Georgia. Yes, sir, that is correct.
Secretary Vilsack, you are familiar with the case Love v.
Vilsack?
Secretary Vilsack. Yes, sir.
Mr. Austin Scott of Georgia. And so, respectfully, you were
named not personally, but as Secretary of the USDA, so this is
not a personal accusation, but there was a settlement with that
case as well, correct?
Secretary Vilsack. There was.
There is a difference. There is a significant difference,
Congressman, as I suspect you know, between what we dealt with
in Love and what we are dealing with here.
Mr. Austin Scott of Georgia. There is, yes, sir, but my
concern is I think there are a lot of socially disadvantaged
farmers. I think there are a lot of small farmers. I think
there are a lot of people that need the help, and my concern is
when we start to group certain people out because of the color
of their skin, then it becomes harder to get anything done. If
it is not equitable and it is not inclusive, then by
definition, it is discriminatory. And when it is discrimination
based on the color of someone's skin, then it is racist. That
is just my personal belief, and I think most people would
accept that definition.
So, one last question for you, Secretary Vilsack. Would you
commit to me that only American farmers would receive relief
under Section 1005, and not foreign nationals?
Secretary Vilsack. I can't commit to that, Congressman,
because that is not what the law that has been passed and
signed by the President says, as you well know.
Mr. Austin Scott of Georgia. So, you are going to----
Secretary Vilsack. Well, let me finish. It is important for
people to understand that contained within the definitions
covered by the American Rescue Plan Act of 2021 are people that
legitimately are entitled to borrow money from the FSA as a
result of actions that were taken in 1984 when Jesse Helms was
the Chair of the Agriculture Committee and Ronald Reagan was
President that opened up the opportunity at USDA to work with
folks who were not citizens, but who were legitimately here.
So, to the extent that Congress passing the American Rescue
Plan Act of 2021 includes all of those folks, that is what I am
mandated to do and that is what we will do. We will follow the
law. I would expect that you would want me to do that.
Mr. Austin Scott of Georgia. You are going to pay off the
loans for foreign nationals, but you will not pay off the
loans----
The Chairman. The time of the gentleman has expired. Thank
you very much, Mr. Scott, for your questions.
I now recognize the gentlewoman from North Carolina, Ms.
Adams, for 5 minutes.
Ms. Adams. Thank you, Mr. Chairman. Thank you, Ranking
Member, as well for hosting the hearing today, and to all of
our witnesses. Thank you for your personal and compelling
testimony.
This is, as our Chairman said, a landmark hearing. The need
for Federal support for Black farmers cannot be overstated. I
want to just put on the record, I am a proud graduate twice of
an 1890, North Carolina A&T. But particularly because the most
recent statistics from USDA make it clear that Black producers
were not served by the last Administration's COVID relief
programs. That is why last month I introduced the House version
of the Justice for Black Farmers Act, H.R. 1393, to address
discrimination at USDA, to provide debt relief, and to support
a new generation of Black farmers. It was good to speak with
you, Secretary, and with you as well, Mr. Boyd, just a day or 2
ago.
I am proudly a supporter of the debt forgiveness for
farmers of color in the American Rescue Plan Act of 2021. Some
of my colleagues, though, on the other side have raised
questions about the constitutionality of that provision. But we
have studied the Constitution. We know that race-based actions
by the government are subject to strict scrutiny by the courts.
And in its 1995 Adarand decision, the Supreme Court held that
government may use race-based remedies that are narrowly
tailored to respond to the practice and effects of racial
discrimination. After the Office of Legal Counsel at the
Department of Justice issued a legal memo which noted that
Congress may be entitled to deference when it acts on the basis
of race to remedy the effects of discrimination.
Mr. Chairman, I ask for unanimous consent to submit for the
record a copy of that 1995 memo.
[The memorandum referred to is located on p. 324.]
Ms. Adams. And that is what we have--thank you--and that is
what we have in the American Rescue Plan Act of 2021: Congress
narrowly tailoring legislation to address well-documented
racial discrimination against farmers of color.
Mr. Secretary, my question for you--and thank you for your
testimony. We have been talking about USDA's discrimination
against Black farmers and other farmers of color for decades
now. In 1988, Congress tried to address it by requiring USDA to
set target participation rates for farmers of color in farm
loan programs, but target participation rates and other
important programs like the 2501 Program are limited in scope,
and haven't fully addressed the barriers faced by our Black
farmers. In the past 5 years, the number of direct farm loans
to Black producers decreased by nearly 50 percent from 945 to
460.
Mr. Secretary, what do you think might account for this
steep drop in direct farm loans to Black producers, and what
steps is USDA willing to take to increase that participation?
Secretary Vilsack. Congresswoman, I am not quite sure why
during the Trump Administration the number of loans decreased,
but what I can tell you is I think it is a combination of
factors that we have to focus on. First, we have to have people
in the Farm Service Agency offices and in the county committees
that reflect the population that they serve. When I was
Secretary the last time, I did, for the first time ever,
appoint minority members to county committees that did not have
minority membership. I think that is important that we take a
look at that county committee structure. I think it is
important, as I said earlier, to connect with community
building organizations to make sure that outreach is taking
place.
One of the problems with COVID relief is I don't--we are
pretty convinced that the outreach to the socially
disadvantaged population was not what it needed to be, which is
why we announced yesterday as part of the CFAP announcement an
effort to try to expand outreach and to reopen CFAP 2 to give
socially disadvantaged farmers greater opportunity to apply.
So, it is outreach.
Ms. Adams. Okay, go ahead.
Secretary Vilsack. I am sorry. It is outreach, and it is
also accountability. Reports to me directly, keeping an eye on
precisely how much progress we are making, and if we are not
making progress, demanding some accountability and reasoning
why. There is a lot more to this, which I will talk to you
about offline.
Ms. Adams. Right. Let me quickly ask you, in the plan,
Congress provided for a new equity commission to address racial
discrimination. We do need individuals on the commission who
bring fresh eyes to the problems, and so, I wanted you to share
your plans to ensure that congressional and stakeholder input
would be used in establishing the commission. I am not sure if
I am out of time.
Secretary Vilsack. We are going to follow FACA,
Congresswoman. We are going to make sure that Congress and
everyone else has an understanding of participation. You can be
assured that we will follow the rules and regulations of FACA.
Ms. Adams. Okay, great. Thank you.
Mr. Chairman, I think I am out of time. I am going to
submit my other questions to the other witnesses.
The Chairman. That will be fine.
I now recognize the gentleman from Tennessee, Mr.
DesJarlais, for 5 minutes.
Mr. DesJarlais. Thank you, Mr. Chairman. I thank you for
holding this important hearing today, and it is always
disturbing to hear issues of discrimination. I feel for the
people and the stories that I was told today.
I did want to mention, there was a comment about Secretary
Perdue. I am sorry, in Tennessee, everything is in bloom, so
forgive the voice and the allergies. But Secretary Perdue was a
great Agriculture Secretary and great to work with, and I think
when he said that you need to go big, that was probably a
comment--if you are a mom-and-pop store, it is hard to compete
against Walmart. If you are a hardware store, it is hard to
compete against Lowes and Home Depot. And I would just say that
knowing Secretary Perdue, he did not mean that in any old
fashion.
I am also very appreciative to be able to work again with
Secretary Vilsack. I am much appreciative for him reaching out
to Members of the Agriculture Committee. Not all Secretaries
take time to do that, so thank you, Secretary Vilsack, for
that.
I think this hearing could have been better today if
alongside these witnesses were witnesses that were Hispanic and
other people--anyone who has been discriminated against,
because farmers of every race, color, national origin, gender,
and religion are struggling. The U.S. farmers are saddled with
near-record debt. There is high suicide rate among families and
farmers who are losing their livelihood.
It is a little troubling with some of the legislation that
has been put forth to have to see what is happening, and then
come back to my district. I can put the camera out my back
door. There is cattle grazing, there are row crops. It is a
rural area. There are small farmers, and they are struggling,
too. It is hard for me to tell them that there is help on the
way, but only if you are a certain skin color. It seems like
that is discrimination in itself. And I would think that the
panelists and witnesses today didn't like the way they were
treated, and wouldn't want other people to be treated that way,
either. It seems like what Austin Scott was saying where
foreign nationalists can get money under this COVID plan, but
not White women. That would bother a lot of people. I know that
he didn't get to finish that line of questioning, but
discrimination in this country is already illegal, as it should
be, and it is the job of the courts to rule on discrimination
and award damages, not Congress.
We saw the $2.3 billion go out to farmers in the Pigford
settlement with dubious results. Now we have the American
Rescue Plan Act of 2021 that includes language for loan
forgiveness for socially disadvantaged farmers, except the ones
that Austin spoke of, for up to 120 percent of the outstanding
debt.
Secretary Vilsack, did you feel that USDA was
discriminatory while you were the head of the agency under the
Obama Administration?
Secretary Vilsack. Congressman, I am certain that there
were times and circumstances where people who were of color,
Black producers, Hispanic producers were not treated as fairly
or as equitably as they should have been when I was Secretary.
We have over 4,000 offices. We have 100,000 folks working at
USDA, so I am not surprised if there were circumstances.
What we did do, however, was we began a process which we
are going to continue and deepen in cultural transformation so
that the number of discriminatory actions was reduced and
ultimately got to zero. We are going to keep a record of EEO
complaints and program complaints, and make sure that if there
was a spike in those complaints, we would find out why and take
action to solve.
And I will tell you, sir, with all due respect to this
discussion, I think people are losing sight of the fact that
the Pigford case was designed to respond to specific acts of
discrimination and compensate for this. The American Rescue
Plan Act of 2021 was designed to do two things: first, to deal
with the cumulative impact of discrimination over time where
some people had the full range of the suite of programs at USDA
and were able to grow and expand, and others did not. Just to
give you an example, CFAP 1 and CFAP 2. Of those who have been
self-identified Black farmers received $20 million----
Mr. DesJarlais. I just wanted to finish with I want us all
to be aware, as we try to unite as a nation, that actions like
Senator Hirono and Senator Duckworth in the Senate just
recently said they wouldn't vote for nominees unless they were
diverse. That is discrimination in itself. We need to get rid
of all discrimination. We need to come together as a people. I
hope our panelists agree. That is what Mr. King would have
wanted, and that is where we need to go. And so, we need to be
careful of that moving forward.
I am sorry to interrupt you, sir.
Thank you, Mr. Chairman. I yield back.
The Chairman. Thank you so much there for your testimony.
Let me make this brief announcement before we move to our
next Member to be recognized. I want to make all of our Members
aware that the Committee will take a short 15 minute recess
following this question period with the gentlelady from
Connecticut, Mrs. Hayes. Immediately after that, we will take a
15 minute recess, and then we will come back.
I now recognize the gentlewoman from Connecticut, Mrs.
Hayes, for her 5 minutes.
Mrs. Hayes. Good afternoon, Mr. Chairman, and thank you,
and thank you to all of our witnesses for being here.
I just want to add that no one on this Committee or in
Congress woke up and just decided let's send relief only to
Black farmers or have this hearing. This is the result of years
of pervasive discrimination and a problem that has existed that
we in Congress recognize we have an obligation to address. This
isn't about what Dr. King would have wanted or we are leaving
other groups out. It is about we are addressing an area of need
that has gone unaddressed for so many years.
This is a pervasive problem, even in my district in
Connecticut, which is not generally seen as an agrarian
district. But according to the Northeast Farmers of Color Land
Trust, White landowners currently control about 95 to 98
percent of the farmland in the United States, and nearly 100
percent in the Northeast. This stark disparity in land
ownership is reflected in the demographics of Connecticut
farmers. Non-White farmers represent just two percent of
farmers in the state according to our Census Bureau, which is
an extremely low number when considering non-White communities
represent nearly 35 percent of the state's overall population.
I am happy that we are here today brainstorming solutions
to address this, and not taking the ostrich approach and
sticking our head in the sand and pretending that the problem
does not exist.
My question is for you, Mr. Boyd. Can you speak to the
disparities between Black farmers and their White counterparts
in accessing subsidies, capital, and land for their farms?
Mr. Boyd. Yes, I can, and thank you very much for the
comments.
I also would like to take a step back and address the Sonny
Perdue issue, because I was the one that stated that at the
meeting I had with him. I do believe that he meant every word
of it. He also said if you wanted to know where Blacks are, go
to TSA and look at New York City and Atlanta, Georgia. And
based on all my experience of meeting with Agriculture
Secretaries, going back to the Carter Administration, that was
my very first meeting--my worst meeting in history with the
Agriculture Secretary.
As it relates to farm subsidies, 90 percent of all
subsidies--the top ten percent receive on average $118,000, the
bottom 80 percent annually in Mecklenburg County, Virginia
receive about $700 annually. When you look at how we
participated in the Trump Administration, the $29 billion that
was doled out in those payments, Black farmers received 0.05
percent. Those numbers of people are dramatic, and if I can't
compete as far as staying in the farm subsidy program and
receive farm subsidies the way that my White counterparts do, I
can't compete. I can't pay the land rent and so on and so
forth.
So, this hasn't just begun, people. This has been going on
for decades, for decades. When you hear people say about the
relief that is out there now, Congresswoman, that is--it is a
new loan program is what I have been watching on the news. This
is a new loan program that excludes Whites, White farmers. That
is not true. It is debt relief, and as Secretary Vilsack
already said, only for those farmers that already have loans on
the books. It is not a new loan. It doesn't exclude Whites. We
simply are trying to level the playing field, and the way to do
that is to have full transparency. By having transparency----
Mrs. Hayes. Thank you.
Mr. Boyd. Yes. By having transparency, we can fix a whole
lot of this.
Mrs. Hayes. Thank you. I am happy that you mentioned
transparency. The time goes by so quickly, but the disparities
that you just highlighted really stress the need for a robust,
effective civil rights office within the United States
Department of Agriculture due to this long history of civil
rights cases being backed up in the USDA.
With the 2008 Farm Bill, it required a report to Congress
describing the number of civil rights complaints filed against
the USDA, the length of time it took to process those
complaints, and any follow up for the resolution. The average
complaint was resolved in what amounted to about 6 years. I
know we really don't have time to address this, but Secretary
Vilsack, I hope that you can really think about plans for
improving the process for addressing civil rights cases within
the USDA, and making sure that we are providing equitable
access to all farmers. Our job here is to help all farmers, but
we also have a responsibility to address those areas of
greatest concern and need, and right now, Black farmers happens
to be one of those areas.
With that, Mr. Chairman, I yield back.
The Chairman. Thank you very much.
The Committee will now stand in recess until 2:15.
[Recess.]
The Chairman. The Committee will now return to order.
I now recognize the gentlelady from Missouri, Mrs.
Hartzler, for 5 minutes.
Mrs. Hartzler. Thank you, Mr. Chairman, for holding this
hearing. Thank you to all our witnesses. I also want to thank
Secretary Vilsack for reaching out to us Members of the
Agriculture Committee to hear our ideas and concerns in
agriculture and where we need to go. I really appreciate that.
Mr. Secretary, I want to follow up on some of your comments
in your opening statement about some of the challenges of
rolling out this provision, and specifically, I have been
hearing from some banks--and you did reference that you don't
know how you are going to deal with the prepayment penalty. But
I am hearing that banks that originate FSA guaranteed farm
loans have raised concerns about the unintended consequences
that the prepayment of these loans will have on lenders,
including their ability to make and service these loans in the
future. Can you go into more detail about what USDA is going to
do to work with these banks to mitigate the costs and to
provide certainty for our farmers?
Secretary Vilsack. Well, thank you very much for the
question. I think the first thing is we need to have a very
detailed understanding of precisely what concerns they have and
why they have them. I have asked the team to reach out to and
to identify those loans that potentially have prepayment
issues, reach out to the banks, ask for the documentation of
the prepayment penalties, and begin a conversation and
discussion in terms of how that is to be handled.
It is going to take, obviously, a little time to do this,
but we are going to be focused on making sure we put adequate
staff behind this effort to get it done, and as I said, as
quickly as possible, as thoughtfully as possible, and as
efficiently as possible.
Mrs. Hartzler. Right. How many of these loans are there
that you will be forgiving?
Secretary Vilsack. Well, I don't think we necessarily know
precisely how many we--I am going to give you a range. Our best
knowledge and best information today is somewhere between
13,000 and 15,000 loans that are potentially impacted by this.
It could be more, it could be less, but I think it is somewhere
in that neighborhood.
Mrs. Hartzler. Okay, very good. Thank you so much.
I wanted to follow up with Philip Haynie. Thank you so much
for your passionate testimony.
I was concerned to hear about how you said you can't access
USDA irrigation funds and you can't participate in land
leveling programs like other farmers. I just wonder, could you
share more about what happened or how come you couldn't? What
happened there?
Mr. Haynie. Yes, ma'am. Thank you for the question.
A lot of Black farmers throughout the Delta where there are
common practices in place for land leveling and irrigation.
These programs that are issued by USDA NRCS, oftentimes they
are told they weren't available to them. They are competing
against neighbors side-by-side, and they often find themselves
on an island where they are a non-irrigated farm, and they have
irrigated farmers on all four sides of them.
So, the practices of putting irrigation on their farms is
something that needs to be implemented through the USDA, and
there should be cost-shares allowing for that.
Mrs. Hartzler. Sure. Could you tell me more though--you
were told or you know some farmers that were told that these
aren't available to you?
Mr. Haynie. Yes, oftentimes farmers go in to apply for
these programs and they are told that there are no funds
available to assist them with that. The cost-share that is
available for the EQIP Program for land leveling and
irrigation, those funds often dry up, and at the cost of
implementing these improvements on their farms, they aren't
able to forebear them, unlike their neighbors who were able to
get these programs implemented during the crux of
discrimination at USDA back in the 1980s.
These farmers are still without, and their neighbors are
with irrigation right beside them.
Mrs. Hartzler. Okay. The problem is that the EQIP funds
have run out when you have gone in and asked, and they didn't
have the funds available, or the matching requirement was the
problem. Is that what I am hearing?
Mr. Haynie. Well, oftentimes farmers are told there are
funds not available, and that may not be the case. I don't
think there is enough oversight in that issuance of those
subsidy programs for land leveling and irrigation for
improvements on the farm. Oftentimes, that pot runs out of
money very soon and farmers have to wait for it to be refilled.
Mrs. Hartzler. Got you.
Mr. Haynie. Thank you.
Mrs. Hartzler. Yes, thank you. I think that is really
helpful we get to the bottom of what is being alleged happened
here.
I wanted to ask Mr. Boyd--well, I only have 12 seconds.
Okay. I appreciate y'all's testimony.
Thank you. I yield back.
The Chairman. Thank you very much.
I now recognize the gentlelady from Maine, Ms. Pingree, for
5 minutes.
Ms. Pingree. Thank you so much, Mr. Chairman, and thank you
to the witnesses.
I have actually been in one of my other committees, so I
have missed all of your wonderful questions and answers, but I
really do appreciate that you are all here, and I certainly
appreciated reading your testimony.
Mr. Rowe, I am particularly interested in you being an
organic farmer, and I know that you are very focused on soil
health and carbon sequestration, which is certainly a topic of
this Committee and one moving forward.
As the USDA considers possible initiatives to encourage
farmers to adopt climate-friendly practices, what
recommendations would you make to Secretary Vilsack or the
Members of this Committee to make sure that you and other Black
farmers are able to benefit?
Mr. Rowe. Okay. Can you repeat that question one more time?
Can you repeat the question one more time?
Ms. Pingree. Oh, absolutely. As you are an organic farmer,
I know you are very focused and you have educational background
in soil health, and because this Committee is focused on soil
health and carbon sequestration and some interesting new
initiatives to encourage farmers to adopt climate-friendly
practices, I am wondering what recommendations you would make
to the Secretary and to this Committee to make sure that you
and other Black farmers are able to benefit from future
initiatives?
Mr. Rowe. Okay. In order for you to obtain your
certification to be organic certified, you have to follow
strict guidelines on how--what you put into your soil, what
equipment used and stuff like that. I feel like if you apply
that to farming, period, it would help with a lot of the stuff
when it comes to, like, climate change, just because the carbon
that comes out of the soil, organic practices are a way to make
sure we are staying healthy, and also keeping the environment
healthy. As you know, conventional farming takes a lot of
chemicals and a lot of stuff to make stuff grow. But that
affects us as humans, it affects the air, and the pollution,
and stuff like that. I would recommend more observing the
organic standards and qualifications you need to be organic
certified. That is something that I can--if I had something
just to say, that would be my opinion on it.
Ms. Pingree. Great. Thank you. I have spent some time as a
certified organic farmer, so I certainly sympathize with the
challenges and the expenses of facing that so more support is
important.
Secretary Vilsack, I am sorry I have not been able to hear
most of the hearing, but I did hear your opening remarks and I
do appreciate you returning, particularly at such a challenging
time. Welcome back as Secretary, again, for Agriculture.
I know a lot of your agenda will be around some very
interesting climate initiatives, soil health, the whole variety
of things that you have already talked about. How do you make
sure that small to medium-sized farmers, and particularly Black
farmers, are able to participate and this doesn't just become
another program that only applies to the large farmers or those
that have the means to apply for a grant or any of the
complications that might get in the way?
Secretary Vilsack. Quickly, I would respond three ways.
First, I have Dr. Dewayne Goldmon in my office now as the
Senior Advisor on Equity. Part of his responsibility is to put
an equity lens on everything that we do, and to encourage those
who are developing these programs to make sure that there is an
equity lens when the program is being developed.
Second, is to make sure that we are keeping track of the
resources that are being allocated in various programs, and how
much of it is, in fact, going to socially disadvantaged
producers. If we see, as we saw with COVID, some imbalance, we
can obviously make corrections. We can ask questions about
that.
I think it is also important for us to have partners who
can help us with outreach. Sometimes, it is not that people
don't want to help, it is that people don't know that they need
the help or don't know where to go to get the help. As has been
indicated earlier, there is a trust issue. I think we have to
build trust, and I think the way to do that is by connecting
ourselves with community building organizations that are
already trusted to get the word out.
I think it is also making sure that as we put our budgets
together, we look at places and programs that we know will be
most helpful. One of the purposes of this hearing--I am taking
notes right now on the suggestions that people are making.
Obviously, that is going to impact and affect as we make future
budget decisions. It is a combination of all of those things
and basically saying to the folks--and I will end with this.
Basically saying to your team this is a priority, and it needs
to be reflected in every decision you make. You need to be able
to justify and explain how equity has been applied. The
President has been very clear about this. It is his expectation
that everything we do at USDA is done through an equity lens,
and I think that is a fair point and one that we are looking
forward to doing.
Ms. Pingree. Well, I certainly appreciate your answer
there, and the importance of all of the points that you have
mentioned, particularly around outreach, because we often find
that people have no idea that there are programs out there that
would benefit them. But also, I think the USDA having that
lens, we often write into a program that there should be a set
aside for this or a set aside for that, but clearly, it is
going to be far more effective if the USDA sees that as their
responsibility to make sure that the distribution is fair, and
particularly that underserved farmers have those opportunities.
I only have 7 seconds, so I will yield back.
Secretary Vilsack. Congresswoman, we will also get some
suggestions from the Equity Commission in terms of overall
structure and strategy. That will be helpful as well.
Ms. Pingree. Great. Well, thank you so much.
The Chairman. Thank you.
I now recognize the gentleman from Illinois, Mr. Davis, for
5 minutes.
Mr. Davis. Thank you, Chairman Scott and Ranking Member
Thompson, and thank you to the witnesses and my good friend,
Secretary Vilsack, for being here today to discuss the impact
of racism in the United States and the work we must continue to
do to ensure there is equity across programs at the USDA.
As a former Chair of the Subcommittee on Biotechnology,
Horticulture, and Research, I have spent a lot of my time in
Congress focused on the importance of our ag research and
extension programs, which should help serve farmers across the
board, and particularly minority and socially disadvantaged
farmers. I appreciate the opportunity to discuss how we can
work to bolster extension programs, those that help serve
minority and socially disadvantaged farmers, in a way that
decreases barriers to access and increases participation in
USDA programs.
Mr. Rowe, thank you for being here today and for sharing
your experiences as a Black organic farmer. I was particularly
interested in your experience in navigating the new hemp
program, along with other USDA organic programs, which have
proved challenging for so many. Can you please share more
regarding the unique challenges you faced trying to navigate
the hemp program, specifically in light of the 2018 Farm Bill,
and what you need from us and the Department to ensure you have
certainty and access to profitable markets?
Mr. Rowe. Okay. It was a challenge doing the hemp because,
as you know, Georgia just got, we were just able to grow
organic hemp, or hemp in general. And a lot of farmers are
uneducated on it. Government assistance doesn't have a lot of
research on it also, so working with universities and doing
research on this new crop that just, that Georgia is just now
growing will also be helpful.
Some of the things that I was--as growing hemp my first
year, I knew as far as, like, diseases or what variety would
grow. Things like that a farmer didn't know, so having those
land-grant and research available for farmers to be able to
reach out. I know Fort Valley State University does a lot of
field research. Like they will have a field day where they will
do a particular crop and explain how to grow it, what it takes,
and all of that. If we could get something like that
implemented with the hemp program, it would be very helpful
because there is less knowledge on this new crop that just came
into Georgia.
Mr. Davis. Thank you, Mr. Rowe. I would be interested in
keeping a working relationship with you as we move forward to
identify any other problems that you are experiencing in the
organic sector.
Secretary Vilsack, hey, great to see you again. I just
wanted to make sure that you and I have chatted about the work
across agencies and with the FDA that is needed to ensure that
we are providing regulatory certainty for hemp and organic
farmers, including Black, minority, and socially disadvantaged
farmers.
Secretary Vilsack. Well, Congressman, I think our first
order we have to have our own house in order in terms of being
able to work effectively with other agencies, which is why it
was important for us to get the hemp rule out. It had been
stuck for a while. We are doing that. We are now in a position
to reach across to HHS and FDA to make sure that there is a
coordination. And frankly, you mentioned biotechnology. There
is obviously a need for us to coordinate effectively with both
FDA and EPA, and I expect to do that. We have to have a
process.
I would say in this day and age, with change rapidly
occurring so quickly, our regulatory processes have to keep
pace with the pace of change, and frankly, sometimes we
basically slow innovation down because our regulatory process
is not communicating effectively between agencies. That is
something we need to work on.
Mr. Davis. Well, thank you, sir, for that, and welcome
back. As I told you before, I look forward to working with you
again and congratulations on getting back into the USDA one
more time.
Secretary Vilsack. Thank you, sir.
Mr. Davis. I yield back, Mr. Chairman.
The Chairman. Thank you very much.
I now recognize the gentlelady from New Hampshire, Ms.
Kuster, for 5 minutes. I think you may be muted.
Ms. Kuster. I am just trying to get my mute off here. Thank
you, Mr. Chairman. And Secretary Vilsack, we appreciate you
being here. Thank you for all the work that you are doing, and
I am grateful for the farmers and producers on the panel for
coming forward to share all of your challenges and insights.
Our country is in the midst of a reckoning on racial
justice and addressing systemic racism, and I think that is the
difference. This is not a question of simply prejudice or
discrimination. We need to go back to the beginning and the
racism since slavery that has led to Black farmers not even
being able to show title to their land.
This past year has not only brought a global pandemic, but
countless painful reminders that we still have so much work
ahead of us on equality and justice here in America, and as has
been discussed today, we have a glaring problem when it comes
to American agriculture. Instead of improving, the number of
Black farmers in our country and the amount of land they own
has shrunken dramatically and continues to decline, and we need
to ask why and make changes that will turn that trend around.
It is incumbent on Congress and the USDA to reverse this trend,
and ensure that our agriculture sector is diverse, and that
every single farmer and producer is treated with fairness and
equality.
So, let's make it clear. If Black farmers and socially
disadvantaged farmers are systematically driven out of our
culture, there would be horrible consequences for consumers and
growers across the country. We have to right these wrongs and
move forward together.
Mrs. Sherrod, as you noted in your testimony, Black farmers
are still impacted by discrimination because government
payments are tied to production. Systemic discrimination has
resulted in Black-owned farms being smaller than White farms,
so Black farmers typically receive smaller government payments.
From your experience, how can Congress help level the playing
field and make sure that Black farmers with smaller operations
aren't penalized when it comes to applying to the USDA?
The Chairman. You may need to unmute.
Ms. Kuster. Mrs. Sherrod? Did it go--no, I am sorry. That
was for Mrs. Sherrod.
The Chairman. Is it Sherrod, you mean?
Ms. Kuster. Mrs. Sherrod, yes, I am sorry.
The Chairman. All right. You may need to unmute. Okay. You
got it, Mrs. Sherrod.
Mrs. Sherrod. Okay. Can you hear me?
The Chairman. Yes, we can.
Mrs. Sherrod. All right. Let me say that, are we still
muted?
The Chairman. No, you are----
Ms. Kuster. No, you are good. We can hear you.
The Chairman. Now you are muted. Go back to where you were.
Mrs. Sherrod. Okay. Okay. Let me say that I have worked on
this issue for many, many years, almost 56 years. I have
actually gone from a period when I had to go in the office with
farmers because they were afraid to go--they couldn't speak up
for themselves, and I could speak for them and I could help
represent them. What that has done is in addition to farmers
trying and being denied, they don't feel there is a place for
them to go. We have to go back and try to help farmers
understand that this agency is there for them, because so many
of them think that is not the case. Many of them think like one
of my grandfathers, when he had the opportunity to try to apply
for money, he said I have never borrowed money from Farmers
Home Administration, because it is just a way to take a Black
farmer's land. That has proven to be true.
You were breaking up so I didn't hear all of your question,
but let me say, we have to go back and make people feel that
this is a place they can come to for help.
Ms. Kuster. Great. Well, thank you so much.
Mr. Boyd, could you speak to the unique challenges that you
have seen Black farmers with smaller farms face when it comes
to ensuring that their land can be passed to the next
generation?
Mr. Boyd. Yes, this has been a difficult task. One of the
challenges is access to credit. Black farmers simply don't have
access to credit. USDA has been played into that, and also the
top ten banks, and we haven't got to talk about corporate
America and the discrimination that Black farmers face there in
companies like Monsanto, John Deere, PepsiCo, all have failed
to deliver contracts and services to Black farmers. These are
things that are coupled all together that has affected us.
USDA certificates of liens that was on my property when I
had debt relief at the United States Department of--I was one
of the first Black farmers to be offered debt relief in the
settlement agreement. Those liens remained----
The Chairman. The time of the----
Mr. Boyd.--on my farm for over 20 years until we were able
to try to purchase another farm. We had to hire a law firm to
get those liens off of my farm.
The Chairman. Yes. The time of the gentlelady has expired.
Ms. Kuster. Thank you. I yield back, Mr. Chairman.
The Chairman. Thank you for your comments. I appreciate
them, Mr. Boyd and Ms. Kuster.
I know recognize the gentleman from Nebraska, Mr. Bacon,
for his 5 minutes.
Mr. Bacon. Thank you, Mr. Chairman. I appreciate the
panelists today and each of you. We appreciate reaching out
across the aisle. I also appreciated the opportunity to meet
with John Boyd.
There is no doubt that our African American farmers
following reconstruction were faced with discrimination and
prejudice extending for over a century.
Mrs. Sherrod, your testimony mentions that the Pigford
settlement did not bring about systematic change. Deep rooted
changes to a system or an agency do take time. Have there been
any improvements, to your knowledge, that can lead to the
systematic change that you are referencing? Thank you.
Mr. Boyd. Basically, what the lawsuit did was really bring
about discrimination issues to the Department of Agriculture,
but many of the issues that we were--that was a part of the
lawsuit never went to Black farmers, such as injunctive relief
such as debt write down, land out of Federal inventory. None of
the farmers received those things, and that is why it is
vitally important that we have this measure.
So many people think that it is a new issue. It is not a
new issue. We asked for debt relief in the actual lawsuit, and
also, we need transparency. If we want to fix any of this, we
need transparency to see who is getting what, and what
programs, such as farm subsidies. If we had those real numbers,
this hearing would be a lot clearer today. We would be able to
say this race received this amount of subsidies. Black farmers
received this amount. We need full transparency, and for those
Committee Members that are here today, we should really take a
pretty good look at that.
And also, those persons who were found guilty of
discrimination were never fired or penalized. As you heard Mrs.
Sherrod testify, she was the only one who got fired. How in the
world can you have two settlements and all of those people that
were investigated that were found guilty of discrimination, and
nobody was fired? And that is a shame for the taxpayers who had
to pay for that. We need to look at those people who--past and
present who are still working at USDA, 30 year bureaucrats who
still have their jobs. Black farmers lost their land and farms,
but these people still have their jobs.
I would like to work with the Committee to move forward on
a transparency measure.
Mr. Bacon. Thank you, Mr. Boyd.
I was also asking Mrs. Sherrod if she sees the systematic
change that does take a long time to do. Is she seeing progress
in the systematic change in the agencies she is working in?
Mrs. Sherrod. Let me say that there, there has been some
change, but not nearly enough to make up for what has been
done. And if you keep messing with someone and they keep
getting hurt, they eventually stop going in that direction. We
have so many farmers who need to go to the agency and they
can't and don't feel they should go to the agency because they
have never been able to get help there. And if it were not for
groups like us, even working with Mr. Sedrick Rowe and others
to try to help navigate that for them, there is just no way
they will ever get help.
The culture there is changing some, because I have been at
this 50+ years, but I haven't seen enough change.
Mr. Bacon. Well, thank you, Mrs. Sherrod, and I think you
have a good point. If your grandfather tells you something and
your father tells you something, you learn not to do so.
With my remaining minute, I got another follow-up for Mr.
Boyd. You highlighted the need to improve technical assistance
and outreach to Black farmers. Are you starting to see that
now? Are we making progress there? Thank you.
Mr. Boyd. I believe that--and thank you, Congressman, for
the question. I believe that the mechanism that is on the table
right now in the Farmers of Color Act, the $1 billion, the
Secretary and his team should reach out and work with
organizations like the National Black Farmers Association and
all of the other panelists that are here today. We have a
unique opportunity to fix outreach and technical assistance in
this measure, something that has been lacking, as you heard my
colleagues testify to, in the Section 2501 Program. This is the
opportunity right now to fix that. Where organizations like
ours, we need resources. Since this bill has been announced,
our phones are ringing off the hook for farmers that are
looking for direction. They want to know how this debt relief
is going to be paid out, how it is going to apply to them, and
we haven't heard enough yet from the Administration. I would
like to ask Secretary Vilsack--he mentioned the Commission. Who
is going to be on the Commission?
The Chairman. The gentleman's time has expired.
I now recognize the gentlewoman from Illinois, Mrs. Bustos,
for 5 minutes.
Mrs. Bustos. Thank you so much, Chairman Scott, and let me
just say thank you for holding this very, very important
hearing today. I want to thank all of our witnesses. You have
all done a wonderful job. Mr. Secretary, thank you for being
here.
I want to start out with a question for you, sir, and I
actually am going to use some facts that Mr. Boyd shared in his
opening statement. Thank you, Mr. Boyd, for laying the picture
out for what Black farmers in America have gone through. The
numbers have fallen dramatically. As Mr. Boyd pointed out, from
900,000 in 1920 to less than 50,000 today. Mr. Boyd also
pointed out that the amount of land that is farmed by Black
farmers has fallen from 41 million acres to less than 5 million
acres today. So, again, Mr. Boyd, thank you for laying that
out. It helps us get an understanding that we got something
going wrong here.
Secretary Vilsack, if I may, what steps can Congress take
to help you at the Department of Agriculture to ensure that
Black farmers get involved in and remain in agriculture?
Secretary Vilsack. Well, I think you have taken a very
important and first step with the American Rescue Plan Act of
2021. The debt relief process, as we have talked about, is an
important step. The Equity Commission which we will set up
pursuant to congressional directive with the FACA, we have to
go through that process to get committee members appointed, is
going to be very helpful to identify systemic barriers that
exist from an external view. We have a working group inside
USDA focused on internally examining this.
I think Mr. Boyd is right about the $1 billion. There is
tremendous opportunity there, not only to improve outreach, but
also to look at ways in which we can do better marketing
assistance for farmers in that local and regional food system
that they need to be part of, and also creating opportunities
potentially for more market opportunities and more land access.
I think Congress could help us by talking to other Federal
agencies, in addition to the USDA, that have land ownership. I
am thinking of the Department of Defense, for example. They
have a lot of land that surrounds a lot of the military
installations. A lot of that land is in rural communities. A
lot of that land is farmable. Where and who do they have
farming that land? Can that be something that could potentially
be made available to minority and socially disadvantaged and
beginning farmers? That is one thing I think Congress could
ask. And certainly to the extent that you would provide the
resources for us at USDA, our budgets over the course of the
last several years have been cut, which makes it harder for us
to have the people and the personnel necessary to do the job.
Hopefully we will see some additional support and help on the
operations side of the budget.
Mrs. Bustos. Thank you, Mr. Secretary, and I appreciate
that innovative approach that we could take a look at.
So, we know that obviously--again, this has been spelled
out very clearly. We need to do more to level the playing field
between Black farmers and White farmers, including greater
transparency in subsidy and loan programs. That has been
discussed today. We need to improve access to land, as you just
talked about, Mr. Secretary, and credit and improve our
outreach to Black farmers. You just laid that out very nicely.
I am lucky enough to be Chair of the General Farm
Commodities and Risk Management Subcommittee this congressional
session, and I know that these are all issues that important to
me as we get to work on our agenda this Congress and gear up
for the next farm bill.
So, this question is actually to whoever would like to
answer it among the panelists, and Mr. Boyd, I am going to ask
you to start. But what have your experiences been with the
commodity programs at USDA? Again, this falls under the
Subcommittee that I will be chairing. And the second part of
that is what steps can Congress take to ensure that Black
farmers feel welcome at the USDA?
Mr. Boyd. Well, one thing I would do--and I have said this
to every Member of Congress--and thank you for taking the time
to speak with me the other day----
Mrs. Bustos. Thank you.
Mr. Boyd. Is that, Mr. Secretary, Black farmers need to
hear from you, that USDA is open for business for Black
farmers, open for business for farmers of color, Native
American, women, all of these persons of color. Make that
announcement and make it with conviction, because we are going
to have to get Black farmers reintegrated back into USDA,
because as you heard Mrs. Sherrod and my other colleagues say
today, Black farmers don't trust the United States Department
of Agriculture, which has really hurt us in participation, and
it is because of all the discrimination that I and others have
faced. And we also need to do more to get new and beginning
farmers into farm programs at USDA, and remove the 3 year
requirement so that Black farmers and other new and beginning
farmers can actually take part into the USDA programs there.
Removing that 3 year barrier has been a big problem, and I
would like to work with you guys to remove that.
Mrs. Bustos. I wish I had time to listen to everybody, but
my time has expired.
Secretary Vilsack, I do want to follow up on your idea with
the Department of Defense.
Thank you, Mr. Chairman, and I yield back.
The Chairman. Absolutely.
I now recognize the gentleman from Indiana, Mr. Baird, for
5 minutes.
Mr. Baird. Thank you, Mr. Chairman, and thank you Ranking
Member Thompson for putting on this informative hearing.
I am going to start with the Office of Partnerships and
Public Engagement, and mention that they hosted last year 50
statewide community prosperity summits to folks on solutions to
challenges facing rural and underserved communities, and
connect them to the education, tools, and resources available
to them through the USDA programs and initiatives.
In 2020, as an example, they connected hundreds of faith-
based as well as youth as well as military and community
organizations to distributors to form partnerships through the
Farmers to Families Food Box Program during COVID-19.
I guess my first question is going to go Mr. and Mrs.
Cotton. In your testimony, you mentioned USDA's Office of
Partnerships and Public Engagement. Can you elaborate more on
your experience with the Faith Fellows training you attended in
Washington, D.C., and how that experience contributed to your
interactions with the USDA, Mr. and Mrs. Cotton?
Mrs. Cotton. Well, thank you, sir, for this opportunity and
the question.
By being at the Faith Fellows inaugural training, we met
the Convoy of Hope. We also met City Serve. We also met Islamic
Relief USA. We met those various organizations. When we came
back to Oklahoma, we reached out to Convoy of Hope and then
subsequently had meetings with them. After those meetings, then
we rented us a big semi-truck and we drove to Missouri to pick
up our first food.
In the interim, as we began to distribute food, we learned
that there was a hub here in Oklahoma called NorthStar Bridge
for Convoy of Hope, and from NorthStar Bridge, we began to pick
up food. First in a car, then a truck, then a horse trailer,
14, then a 20 horse trailer. After the Farmers to Families
Food Box Program started, NorthStar Bridge saw that we were
serious about helping our community. They began to distribute
trucks to us. We were receiving up to four semi-trucks a week
in our small rural area.
The people come because we have been consistent. They come
because they trust. There has not been any training in what we
do. We have been in the service of the Lord for most of our
lives. It is just reaching people, helping people, being humble
servants.
And so, because the government realized that faith-based
entities are the bottom kind of rung of the ladder for
individuals who have their trust in someone, they began to use
the Faith Fellows as a pinpoint for these activities. The thing
of it is, is that it was a truck to trunk program, and often,
the vendors across the U.S., as they received these fundings to
distribute the food, were sending it out but that last mile
delivery, the people were not realizing any financial help from
it.
Today, as a matter of fact, we canceled two semi-trucks so
that we can be here today, all right? Tomorrow, we will have a
once-a-month senior program that we will distribute food there.
But this has created great opportunities for us to continue to
figure out how in the world we can get from busyness to actual
business in reaching our communities. My husband just said
community togetherness. In our community, the testimonies are a
mile long. That is basically what we have to offer on that.
Mr. Baird. Thank you.
Secretary Vilsack, would you care to comment about the
Office of Partnerships and Public Engagement? I think you made
reference to that earlier. I can give you an opportunity to--we
have about 37 seconds, so----
Secretary Vilsack. Well, it is an important integral part
of our effort to improve outreach, but I think we have to do
more in that area and we have to basically cast a much wider
net in terms of the partnerships that we are developing. I
think the opportunity for us at USDA starts with historically
Black colleges and minority-serving institutions, because they
have an incredible network and I think we need to tap into that
network more effectively and more efficiently than we have in
the past. That is where I would start.
Mr. Baird. I have about 4 seconds left, and I just have to
put a plug in for the land-grant universities and the
cooperative extension service, because they played a vital role
over the years in making sure we got the research information
out to these rural communities.
And I know, Mr. Chairman, you are ready to put the hammer
on because I have reached my time, so thank you. I yield back.
The Chairman. I appreciate the gentleman realizing his time
had expired.
I now recognize the gentlelady from the United States
Virgin Islands, Ms. Plaskett, for 5 minutes.
Ms. Plaskett. Thank you very much, Mr. Chairman, and thank
you to all of our witnesses for being here today, and
particularly, thank you, Secretary Vilsack, for your commitment
to the issues that we are addressing in this hearing, which has
long been overdue at the full Committee level. I want to also
just applaud my colleagues for their patience and their
steadfastness, and getting to the meat of the issues here in
this hearing.
Secretary Vilsack, one of the questions that I have is
related to the Coronavirus Food Assistance Program and CFAP 2
payments, which have been successfully compensated all
producers, at least partially, who have experienced unexpected
economic loss of costs due to the COVID-19 during the second
through fourth quarters of 2020. Are we aware or what are the
mechanisms and data that we have for--to know if CFAP 2 funds
have been distributed in a fair manner to every producer and
for every commodity sector that experienced COVID-19 related
costs? I ask that question in particular as you have shown
through your quick appointment to agriculture the disparity in
distribution to Black farmers in the other funding.
Secretary Vilsack. If you take a look at the payments that
have been made to those who have self-identified as White,
Black, and other socially disadvantaged categories, in CFAP 1
and CFAP 2, Black farmers would have received approximately $20
to $21 million. White men and women farmers would have received
$5.6 billion. That is why I think that one of the things that
you did in the American Rescue Plan was to essentially
understand and appreciate the disparity in terms of how the
COVID relief was distributed in terms of how much went to White
farmers and how much went to socially disadvantaged farmers.
And part of what you have done is you basically created a
better sense of balance, if you will, in the COVID relief
efforts. We tried to complement that recently with the
announcement that we are going to additional outreach on CFAP 2
to make sure that those socially disadvantaged producers that
have not yet applied for the ability to participate in the
program are given a 60 day opportunity to do so. And the hope
is with additional outreach, that we will see more applications
from socially disadvantaged producers.
Ms. Plaskett. Thank you.
As follow-up to that question, sir, Mr. Secretary, with
this debt relief that has been provided for Black farmers, is
there an assumption or shouldn't there be an assumption that
other tacit forms of discrimination at the Department need to
be corrected, and what is being done to identify what those
other areas might have been, and how they can be rectified and
monitored?
Secretary Vilsack. Well, there are three parts to the
American Rescue Plan Act of 2021. We talked about debt relief
and we have also talked about the billion dollars that could
potentially increase outreach, land access, and financial
marketing.
The third element is the Equity Commission, and this
Commission is going to be an external commission that is going
to take a detailed look at every single aspect of USDA's
activities to determine and to identify those systemic barriers
that may exist and the way in which programs are operated.
At the same time that that is going on, we are also going
to have, pursuant to President Biden's Executive Order, an
internal review. We already have a working group that has been
established. They have already begun the process of assessing
our benefits, our services, our contracts, and our
procurements. I would put particular emphasis in response to
your question on the issue of contracts and procurements as we
are looking at ways of increasing marketing opportunities,
especially for small and mid-sized operators, for socially
disadvantaged farmers, for beginning farmers, the opportunity
to use Federal purchasing power, the procurement power of the
Federal Government may be a strategy that will provide some
quick wins, if you will, in terms of market access. And that is
something I hope our team will be taking a very close look at.
Ms. Plaskett. Thank you.
And as a final thought, in having conversations with some
of the witnesses prior to the hearing today, I am particularly
moved by and concerned with regard to discussions with Mr. Boyd
where he talked about not necessarily just at the Department of
Agriculture, but in the whole life cycle of Black farming,
issues of access to farm credit, to bank loans, even to have
those companies who they rely on for equipment to have
different policies and leverages for Black farmers than they do
for others. Have you been thinking of or would you be willing
to sit with us as legislators to come up with ways to both
incentivize those organizations and those outside and private
entities to support Black farming, to grow it, as well as to
find ways to enforce Federal law against discrimination and to
support them?
The Chairman. The gentlelady's time has expired.
I now recognize the----
Ms. Plaskett. May he answer the question, Mr. Chairman?
The Chairman.--gentleman from South Dakota.
Secretary Vilsack. Mr. Chairman, I will just respond yes to
your question, Congresswoman.
Ms. Plaskett. Thank you.
The Chairman. Yes, and also, Mr. Secretary, you can respond
more in writing for the record.
I apologize to everyone, but we are trying to get everyone
in, and so, I hope you will help me here. I want to hear from
everybody, too. And perhaps, Mr. Boyd can relate to your
question when he is recognized again.
Thank you for your consideration, Members.
I now recognize the gentleman from South Dakota, Mr.
Johnson, for 5 minutes.
Mr. Johnson. Thank you very much, Mr. Chairman, and I will
direct my comments and questions to Secretary Vilsack.
I would first note, sir, that you have invested a
remarkable amount of time already in speaking with me and other
Members of the Committee since you were sworn in, so thanks for
that. I think it shows an authenticity and an earnestness on
your part to do this work together, and I think this Committee
hearing has been fantastic as we talk about how to make sure
that we are serving all of agriculture and all producers. It
has been a wonderful hearing.
And in that vein, I want to call out and commend USDA, sir,
for the appointment of Zach Ducheneaux as Administrator of the
Farm Service Agency. Mr. Ducheneaux has been an incredible
advocate for South Dakota agriculture, for Tribal agriculture,
for socially disadvantaged farmers. He is an enrolled member at
Cheyenne River, and he is going to be really good at the job.
And so, thank you to USDA for walking your interest in
diversity, sir, on that front.
The one question I have for you, Mr. Secretary, follows up
on my March 3 letter and gives you a little real time update
related to my concerns with the U.S. Forest Service
recommendation to reduce the Timber Sale Program. And there is
a real impact here on socially disadvantaged people, because a
huge portion of the forestry workers who are impacted are
Latino and Latina. And the update is just this week in Hill
City, and that is a town of about 1,000 in the Black Hills of
South Dakota, a large sawmill has announced that it is closing.
Forty percent of those 120 employees are Hispanic. That comes
the same week that we have the Forest Service announce via a
general technical report that they think that the timber
harvest coming out of the Black Hills should be reduced by 50
or 60 percent. And we know that when you lose those jobs from
socially disadvantaged people in forestry, in timber, they are
highly unlikely to come back. That capacity doesn't come back
very easily. We have seen that across the country.
And so, I just want to make sure, sir, that that is on your
front burner, and just asking for a commitment to work with you
and the Forest Service in continuing to analyze the science
behind these studies. We want to make sure that when we have
socially disadvantaged employees, they have an opportunity to
keep those good paying jobs and help out their communities. Any
thoughts, sir?
Secretary Vilsack. Congressman, I certainly appreciate the
importance of outreach and connection with stakeholders who
have a strong interest, as you have expressed, in the Black
Hills. I would hope that our Forest Service--and I believe our
Forest Service will continue to be engaged in continued
collaboration.
As you have indicated, the scientists from the Northern
Research Station's Forest Inventory and Analysis program
recently concluded their study. I would point out that this is
a scientific document. It is not a policy or decision document,
so I think it is important to note that to your point of
whether or not there are other considerations or other science
or other information that needs to be considered. Obviously, I
think we need to take everything into consideration before any
specific decisions are made.
It is a large body of science, obviously, that is now
available to managers in the Black Hills. They can take a look
at it. They can respond to it. They can react to it, and then
it will give us the opportunity to sort of take into
consideration as we finalize the general technical report.
Hopefully, folks are going to provide us the input necessary
for us to ultimately make the very best decision for folks in
that area.
Let me just simply say, however, this is a very difficult
issue generally, this issue of timber and this issue of timber
sales and mills. And we have to figure out ways in which we can
increase market opportunity for forest and wood products across
the board. Whether it is using cross-laminated timber to build
tall buildings, or some other mechanism, because we want to
make sure that we maintain the carbon that is stored in those
trees as opposed to, unfortunately and tragically, watching too
much of it burn up in fires that we have seen that have been
historic.
Mr. Johnson. I think that is well said, sir, and we know
that a managed forest is a healthy forest. I liked your
problem-solving approach.
With the time that I have left, I will just note that you
are right. It is a scientific document. I think there is an
opportunity for entrepreneurial policymakers like you and me to
try and find some different solutions. For instance, that
scientific report only really analyzes the timber available in
suitable timberlands, meaning areas that have traditionally
been forested, or rather, been harvested. If we can get your
team the resources they need to build additional timber roads,
that is going to give us new areas of the forest. That is going
to give us new jobs, including for these socially disadvantaged
people.
Thank you very much, Mr. Secretary. Mr. Chairman, I would
yield back.
The Chairman. Thank you very much.
I now recognize the gentleman from California, Mr.
Carbajal, for 5 minutes.
Mr. Carbajal. Thank you so much. Thank you to all of you
for participating today, and thank you, Mr. Chairman, for
holding this important hearing.
In my district, we have over 800 Latino farmers, and I have
had the opportunity to speak with some of them about the
discriminatory barriers that they face every day, such as
language barriers, lack of access to technical assistance, and
the need for improved access to land and capital. USDA's Civil
Rights Action Team reported in 1997 that Latino farmers were
systematically excluded from USDA programs, and in the year
2000, Guadalupe Garcia and a group of Latino farmers filed a
lawsuit similar to the Pigford, and that was ultimately settled
by the USDA. This lawsuit alleged that discriminatory lending
practices by USDA deprived Latino farmers of opportunities
afforded to their White counterparts.
For example, one of the Latino farmers in this case was
denied a loan to buy land by her local FSA office because they
claimed that the land didn't have sufficient water to farm it,
even though the land in the same area was also being farmed by
two White farmers who were financed with FSA operating loans. I
would ask for unanimous consent to include in the record the
amended complaint in the Garcia lawsuit, Mr. Chairman.
The Chairman. [inaudible].
Mr. Carbajal. Without objection?
The Chairman. Without objection. Thank you.
[The case referred to is located on p. 350.]
Mr. Carbajal. Thank you.
Continuing the current discussion of Black farmers, let me
ask you this, Secretary Vilsack. In my district, the Natural
Resources Conservation District, NRCS, technical assistance,
and the expertise of cooperative extension service have proven
to be critical to ensuring that the latest science-based
practices and the management techniques reach farmers,
especially regarding carbon sequestration. In what ways can
technical assistance be improved to better benefit Black
farmers?
Secretary Vilsack. Well, I think there are a couple of
things, Congressman.
First of all, I think we need more folks, more boots on the
ground. That is obviously an appropriations issue. I think
based on our targets and based on what we think is adequate for
servicing the needs of people, we are about ten to 15 percent
below where we need to be with NRCS boots on the ground. So,
first and foremost, boots on the ground.
Second, partnerships. We have mentioned this before. The
ability to align ourselves with the folks who are trusted in
the community to expand our reach, if you will. That starts
with land-grant universities, Hispanic-serving institutions,
and other community building organizations.
I think it is also--we just recently requested input from
folks on the issues of climate through the Federal Register. I
would encourage you to encourage your stakeholders in your
congressional district to respond to the set of questions we
have put forward so we get better ideas and better input on how
to structure efforts in terms of carbon in the future at USDA.
That may also be a way of increasing our understanding of what
is necessary and needed on the ground.
Mr. Carbajal. Thank you, Secretary.
I welcome the other witnesses to also weigh in, if you
could.
Mr. Haynie. Congressman, I think one thing we need to
recognize is that we need more diversity within the agency,
more people that can relate to the constituents that they
serve, more African American and Latino representatives from
NRCS that can go engage with these communities and have
conversations and relate with those audiences. I think that is
a big factor and would help play a big role in continuing the
communication and the services that are available to the farms.
Mrs. Cotton. And this is Arnetta Cotton. I would like----
Mr. Carbajal. Yes, go ahead.
Mrs. Cotton. This is Arnetta Cotton. I would like to add
that you talked about the language barrier. It is not just a
Latino barrier. It is the whole--all the acronyms used by the
government, all of the different forms that are not down to the
language or the capacity of a regular farmer. And then it is
the fact that it is the same people in the office who was there
through Garcia, through Pigford, through all of the others.
They have not been let go, so they feel it is okay as if they
have the blessing of the agency. And it is a poor
representation, because the USDA is the peoples' agency.
Mr. Blanding. Also, Congressman, I would also like to add
to that if you don't mind.
I think as a nation, we have to realize that all of our
challenges have solutions, and it is incumbent upon all of us,
the government, our corporations, our organizations, farmers,
and all of our citizens to be a part of those solutions. And
until we do that, we are going to constantly run around in
circles. Farmers need to be educated, but also the USDA----
The Chairman. The time of the gentleman has expired. Thank
you so very much.
Mr. Carbajal. Thank you very much. I yield back.
The Chairman. I now recognize the gentleman from Georgia,
Mr. Allen, for 5 minutes.
Mr. Allen. Can you hear me?
The Chairman. Yes, we can. Go ahead, Congressman.
Mr. Allen. Thank you, Mr. Chairman, and thank you for
holding this hearing. It is important that we know the state of
our food supply in this nation, and of course, we are focused
on our Black farmers in the U.S.
When I grew up, I grew up on a farm. Ninety-seven percent
of the population of this country was involved in some way when
I grew up in agribusiness, and it has changed quite a bit since
I grew up. I think it is less than two percent of the people in
this country, Mr. Secretary, that are now involved in
agriculture. And of course, what happened was my dad was a
dairy farmer with timber and other things. Of course, along
comes production ag, and in fact, the milk company was going to
finance the expansion of my dad's dairy, but when my dad looked
at the numbers and the fact that he had to put his land on the
line, he turned it down. He went into competition with them and
it put us out of business. And so, again, we are somewhat of a
casualty to what has happened in agriculture since the 1960s,
and I am sure it has affected folks in this hearing today. That
is, it is unfortunate, because my dad loved it, but he just
couldn't continue on.
And obviously, from a stand point of bringing this nation
together--and I understand the feelings on both sides, but, as
people of faith, it is not an option that we come together. In
fact, Mr. Chairman, this one is for you, because I know every
time I get on an airplane you are reading the Bible. 1 Samuel
16:7 says: ``The Lord sees not as man sees. Man looks on the
outward appearance, but the Lord looks at the heart.'' And we
know that God is an impartial God, so--but we are falling
world--and we have to deal with it with our differences.
In that respect, Secretary Vilsack, I am just going to tell
you what I have heard floating around, and I just want to find
out what you have seen there. But the American Rescue Plan Act
of 2021 includes $4 billion for USDA for loans to disadvantaged
farmers, but in that definition of disadvantaged farmers--and
again, what we are hearing is like if you want to change--in
this country, if you decide you want to change your gender, you
can change your gender. Is there a possibility that farmers
could say hey, I want to change my race and benefit from this
program?
Secretary Vilsack. Congressman, I think what you are
getting to is a very fundamental question, and that is whether
we trust farmers or don't trust them. When we had COVID relief,
we trusted farmers when they told us that they were producing
corn or soybeans. We didn't ask them to prove that, we trusted
them, and we sent out billions and billions of dollars. If you
want to create some kind of mechanism that suggests that we are
supposed to distrust farmers, well, we could do that, but I
don't think that is what you want, and certainly not what I
want. We didn't ask for that in CFAP, and I don't think we can
ask for it in this particular situation.
The reality is, we are going to--we are dealing with people
that the Department knows.
Mr. Allen. Sir, not to interrupt you. I am not talking
about trust. I am talking about what is the legality of that?
Did you all look at the legality of that in this law when you
made the law?
Secretary Vilsack. Well, I think it is constitutional.
Mr. Allen. I am not talking about a trust issue here. If it
is legal to do this and someone can legally do it, is that
possible?
Secretary Vilsack. First of all, I think the statute is--I
think the law is constitutional for the reasons that were
articulated earlier. It is tailored. It is focused on a
particular set of issues and trying to resolve those issues.
And it certainly is dealing with the cumulative impact of
discrimination. So--but I do think it is a trust issue at the
end of the day, and I think we are going to trust folks. These
are people that have dealt with somebody at the FSA office.
They have had to make a loan. It is not like these are people
that we don't know. We know these people, and the reality is,
they are going to sign the document that says they are
attesting to the truth of whatever it is they are representing.
And there are serious, serious civil and criminal penalties if
you don't tell the truth.
I, for one, I am going to trust the farmers to be truthful,
and if they are not, then they are going to be held
accountable.
Mr. Allen. Okay. Well, again, we make these laws. We
appropriate monies, but from a legality standpoint--and that
question was asked to me, and I don't think they were joking. I
mean, at first I thought it was a joke.
The Chairman. The time of the gentleman has expired.
Mr. Allen. Okay. I yield back, Mr. Chairman.
The Chairman. With all due respect, Mr. Allen.
I now recognize the gentleman from California, Mr. Khanna,
for 5 minutes. You may need to unmute, Mr. Khanna.
Mr. Khanna. Can you hear me, Mr. Chairman?
The Chairman. Yes, we got it. Go ahead.
Mr. Khanna. Thank you. Well, let me just first say how
pleased I am to see Secretary Vilsack in his role. He has
demonstrated such a commitment in his record of public serve to
inclusivity, to expanding opportunity, to caring about rural
America, both Black and White rural America, and I have great
confidence in his leadership. I am glad that President Biden
selected him, and that he was willing to come back to
Washington.
I also want to thank Mr. Boyd for his leadership for
decades in bringing issues of equity to the forefront, and
really, it is a testament, sir, to your leadership and to the
Chairman's vision that we are having a hearing that is long
overdue about basic equity for Black farmers.
Mr. Secretary, you spoke eloquently about USDA's long
history of discrimination and some of the practices. How do you
think we can hold some of the local county committees
accountable for the bad actors? There are still some bad actors
in some of these local county committees, and how do you think
we can get accountability there?
Secretary Vilsack. Well, I think first and foremost is
making sure that those county committees have adequate
representation that reflects the population that they serve.
Oftentimes, when I was Secretary last, we had 385 counties, I
believe, that didn't have a minority representative. I
appointed minority representatives on those committees. First
of all, there is that, and to the extent that people do provide
discrimination, I think the point has been well taken. I have
taken notes on this. The reality is if we say that
discrimination is not to be tolerated and, in fact,
discrimination occurs, then we do need to take disciplinary
action and it needs to be effective, and it needs to be
forceful, and it needs to be relatively quick so that people do
get the message that this is serious and this is a new day. And
I expect and anticipate that our team will act accordingly.
I think it is also--the Equity Commission is going to be
looking at all aspects of our operation, and I suspect that
they will be looking at the structure and the basis and the
mechanisms by which decisions have been made and appeals take
place, and how that operates. And they may make a set of
suggestions and recommendations. Clearly, our internal review
of this from our working group, consistent with President
Biden's Executive Order, may also result in recommendations.
That process is just getting started, and I want to make sure
that that process is able to work its way through the process
so that we get the very best recommendations.
Mr. Khanna. Mr. Secretary, you have spoken to a number of
us on this Committee about the importance of technology, about
the importance of broadband, biomanufacturing, precision
agriculture, and I wonder how you think we can address some of
the digital divide in access to technology where the African
American community and Black farmers, Black rural South has
been excluded from a lot of that technology, and what can we do
to help alleviate that?
Secretary Vilsack. Well, I think first and foremost, making
a true fully funded commitment to expanding access to rural
broadband, so that, in fact, the technology exists. In many
communities, it does not exist.
Second, I think it is working--again, as we talked about
community building organizations funding and providing them the
resources, extension and land-grant universities, historically
Black colleges, et cetera, being able to give them the
resources that will allow them to do the training so that
people understand, whether it is a small business person or a
farmer, how technology can be utilized appropriately.
I think it is frankly also basically getting younger people
into the United States Department of Agriculture from these
areas in the form of internships so that they, in turn, can go
back home with an understanding of how USDA works, and what
they need in their rural communities, and be able to see if we
can create career opportunities for them at USDA in their local
communities to be able to solve some of the problems that they
know firsthand. It is a combination of that, and I am sure
much, much more.
Mr. Khanna. I appreciate that. I have been surprised in
just my work how much of our economic development is funded
with the U.S. Department of Agriculture, and I look forward to
your leadership on that.
One question for Mr. Boyd and Mr. Blanding, and thank you
again for both of your work. You have correctly testified that
Black farmers are still impacted by discrimination and
government payouts are linked to production. Black farmers have
had less land, are smaller because of the historical legacy of
racism. How do we then level the playing field, given that
Black farmers are at this disadvantage because of having less
land?
Mr. Boyd. Yes, I will take a crack at that first.
First of all, we need to redo the base calculation, the way
that they are calculated, and also, we need caps. We need caps
so all the money just won't go to the big farmers. We have to
figure out a way to do that. During those Trump payouts, there
was no sense in having one county, like Mecklenburg County,
receive $40 an acre, and then in Georgia County receive $140 an
acre. We have to figure out----
The Chairman. The time of the gentleman unfortunately has
expired. Perhaps, again, Mr. Boyd----
Mr. Boyd. I am trying.
The Chairman.--may find a way to answer that when a
question is put to you.
What a terrific hearing.
I now recognize the gentleman from Ohio, Mr. Balderson, for
5 minutes.
Mr. Balderson. Thank you, Mr. Chairman. I want to thank the
panel for being here, and I also want to thank Secretary
Vilsack for joining today. I look forward to having a phone
call with you next week, but I just want to remind you--you
won't remember me, but I met you with Zack Space. You were in
my hometown of Zanesville, Ohio, Muskingum County, when Zack
represented us in Congress and we were kind of doing a nice
little tour, and you did a really nice job. You were down at
the Zanesville Welcome Center. Pretty close to Zack's downtown
office here. I look forward to working with you being a Member
of Congress now.
But Rep. Plaskett kind of touched on this a little bit,
Secretary, but you know, 1 month after Congress appropriated
additional money for the Coronavirus Food Assistance Program,
or as she referred to it as CFAP, President Biden froze the
payments. Can you discuss why the Administration suspended CFAP
payments and what the Agency discovered in the nearly 2 month
halt?
Secretary Vilsack. It is standard practice in changes of
Administration for the incoming Administration to take a look
at what may have taken place just before the new Administration
took over. And so, we wanted the opportunity to basically take
a look. We also wanted an opportunity to analyze who wasn't
being served, who wasn't being helped, who wasn't being helped
as much as they needed to be, and that is why yesterday we made
the four-part announcement payments now going under CFAP 2 and
CFAP 1 to cattle producers and some of the commodity producers,
but also resources now for local and regional food system
opportunities, as well as a series of steps we are going to
take with roughly $6 billion to help those we have now
identified were not served, not helped by previous COVID
packages. We will, over the course of the next several months,
be involved in rulemaking to get those resources out the door
as quickly as possible.
It was designed primarily to give us a chance to analyze
who had been helped and who hadn't been helped, and to create
and construct an effort to make sure that we had equitable
assistance throughout the COVID. I will just say, as part of
this hearing, it allowed us to identify the fact that in CFAP
2, the outreach to socially disadvantaged producers wasn't what
it needed to be. That is why we are going to expand the sign-up
for 60 days to give people a chance to apply for those
benefits.
Mr. Balderson. Okay. Well, thank you, Mr. Secretary, and I
look forward to speaking with you again next week.
My next question is for the panel, and you all can answer
this. I appreciate all your testimonies that you have given
today.
If each of you could target one area for the USDA to
improve its practices or programs, what would that be? Let's
start with Mr. Boyd, since he kind of gets shut off every time
he gets to start talking. Mr. Boyd, lead the way.
Mr. Boyd. Well, first of all, I would do away with the 3
year limitation requirement for new or beginning farmers. That
is the first thing I would do, and I would make sure that we
have full participation in farm ownership loans, farm operating
loans, all of those areas where Black farmers today are pretty
much absent. The only way to do that is to have oversight and
transparency, something I have been trying to get in this whole
hearing and I haven't been able to get it in. We need
transparency so when we have hearings like this, we will be
able to lay out the numbers by state, county, ZIP Code, by
race, and when you have people that bring these issues up, you
will be able to go right to those numbers and see what they
are. That is the way that you improve.
Mr. Balderson. Thank you, sir. Anybody going to go next?
Mr. Haynie or anybody would like to go next, go ahead.
Mr. Haynie. I think the one thing that needs to be
addressed is the subsidy programs. John mentioned it earlier,
but right now, we are seeing 20 for a Black farmer compared to
$1 for White farmers on these subsidy programs. That is
something that really needs to be addressed. You have Black
farmers right beside White farmers and they are only getting
25 on a dollar for what their neighbors are receiving in ARC
and PLC programs. These programs were established back in the
1980s during the crux of discrimination at USDA, and they
really need to be addressed. So, that is one issue.
The Secretary mentioned about the COVID program. One of the
benefits of CFAP 1 were the larger farmers had grain storage
and capacities that a lot of small farmers didn't have. If you
didn't have grain stored in your bins, you weren't able to
benefit. A lot of Black farmers had to sell their grains in the
fall of the year and weren't privileged to storage benefit. The
commodity programs and Congresswoman Bustos from Illinois
mentioned it, that is a large pot of money to go out, and the
disparities really start to show themselves when you look at
subsidy programs and differences in dollars paid out to Black
farmers and White farmers.
Thank you.
Mrs. Sherrod. If I may, please allow me the opportunity to
say that farmers with smaller acreage can't compete with the
commodity crops. We actually have had them co-opted, in
cooperatives, and we are organizing them to grow and sell into
other markets, vegetables and so forth. They need the
infrastructure. They can't afford to put in a facility to wash,
dry, cool, and get products to market. It is very important for
those small growers, those small landowners to have access to
money like this to give them a chance to survive.
The Chairman. Thank you. Thank you.
Mr. Balderson. Thank you very much. Mr. Chairman, I yield
back.
The Chairman. Thank you so much, and I appreciate you all
panelists. This is such an energetic hearing. It is great. It
is certainly historic, and I appreciate you all.
I now recognize the gentlewoman from Washington, Ms.
Schrier, for 5 minutes.
Ms. Schrier. Thank you, Mr. Chairman, and thank you to our
guests.
The first issue I want to focus on is land and water access
for Black farmers. Our witnesses today have left no doubt that
farmers of color have faced and still face systemic barriers to
land ownership and water access. And today, Black farmers are
more likely to rent rather than own farmland. They have smaller
farms, own less land, generate less wealth from farming
compared with White farmers, and these factors leave Black
farmers at a huge disadvantage, because farmland real estate
represents nearly 80 percent of total U.S. farm assets. Farmers
who do not own land or have a clear title to land can't
leverage that land or capital to invest in, sustain, and
improve their farming operations.
Now, this is especially challenging in urban and suburban
areas like King and Pierce County in my district. For example,
in Washington State in general, the average price for an acre
of cropland in 2020 was just over $2,600. But by comparison in
King County, the average price for an acre is more than
$35,000, and in Pierce County, it is around $21,500 per acre. I
have heard from farmers of color in Washington State about the
difficulty in obtaining farmland because of these prices, and
the historic systems of discrimination that prevent them from
ever purchasing farmland.
So, my question, Mr. Blanding, can you speak about the
importance of access to land and actually land ownership for
Black farmers, and can you talk about what systemic barriers to
the purchase and ownership of farmland exists for Black farmers
today?
Mr. Blanding. Yes, thank you. That question is for Blanding
or Boyd? I am sorry, I didn't hear.
Ms. Schrier. Mr. Blanding.
Mr. Blanding. Thank you, Congresswoman, for that question.
So, the problems with Black farmers and Black land
ownership is historic. First, in terms of ownership, or again,
access to land, first of all, there has to be access to
equitable credit in order to get access to that land. And I
think there has been systemic problems in the credit industry
for years. I think this is an opportunity for there to be a
Black farmer financial institution modeled after the Farm
Credit System where Black farmers can get the kind of credit
that they need and serve themselves, just like the Farm Credit
System, which is a great system, by the way. But again, Black
farmers need to have access to that type of credit.
But our problem is around maintaining and holding on to
existing land. Heirs property is a major issue in the Black
farming community and the Black community overall. We estimate
60 percent of all Black landowners have this heirs property
issue, and so, we must figure out ways to make sure that there
are things that can be done to make sure this heirs property
situation is cleared up. There are things that already exist,
like the Heirs Property Relending Program that was approved for
the 2018 Farm Bill, but it has yet to be implemented and
funded. So, things like that can be done immediately. But also,
a lot of education and technical assistance around that area
will go a long way to make sure Black farmers continue to hold
on to their land base, and continue to thrive in this country.
But I would also like to say, Congresswoman, that we as a
country have to look at the value of not only all farmers, but
Black farmers and specifically around dealing with the issues
around land and water, as you suggested, because they are all
part of the equation, and you have to make sure that Black
farmers are part of that as well.
Ms. Schrier. Thank you.
I need to address one more question. Thank you for your
comments.
I just want to also address Black, Indigenous, people of
color farmer participation in conservation programs
specifically. Among White farmers in Washington State, about
nine percent receive Conservation Reserve, wetlands reserve,
farmable wetlands, or Conservation Reserve Enhancement Program
payments. For Black farmers in Washington, it is less than one
percent.
So, Secretary Vilsack, under your leadership, how will the
USDA work to combat historic and current racial injustices in
climate and agriculture policy, and how can the USDA continue
to support existing conservation programs and make them more
equitable and accessible?
Secretary Vilsack. Well, there are several things. First of
all, we are going to ask the current acting Chief of the NRCS,
Terry Cosby, who is an African American, to help lead that
effort to make sure that resources are more equitably available
to socially disadvantaged producers.
Second, again, the internal review and the external review,
whether it is the Equity Commission or the internal review from
President Biden's Executive Order, will obviously identify
recommendations.
Third, it is about accountability to John Boyd's question
or his comment about transparency. It is about asking for
information on an ongoing basis to make sure that you see
whether there is, in fact, investment being made, and if there
is not, why there is not and who is responsible for making sure
that there is.
So, it is a combination of a lot of those things. I think
it is also a combination of working again with better outreach.
It may not be that folks don't qualify or it may not be that
they are prevented from qualifying; it is that they may not
even know about the program. They may not know what they have
to do. And I think this money in the American Rescue Plan gives
us an enormous opportunity to improve outreach and to take a
look at additional opportunities to help farmers access more
revenue. I think that is what the market process----
The Chairman. The time of the gentlewoman has expired.
Ms. Schrier. Thank you, Mr. Secretary. I yield back.
The Chairman. I recognize next the gentleman from Kansas,
Mr. Mann, for 5 minutes.
Mr. Mann. Thank you, Mr. Chairman.
My question is for Mrs. Cotton. Thank you for your
incredible service to your community. In your written testimony
and in our conversations, I know you have mentioned that you
have helped deliver food to more than one million people in
five states during COVID-19 through the USDA's Farmers to
Families Food Box Program. What do you foresee is the future
for this program, and how can the USDA assist with connecting
more rural and underserved communities, or communities in the
last mile to get them the food that they need?
Mrs. Cotton. Thank you, Representative Mann. I appreciate
that question.
It is an excellent program. It is viable and it is much
needed. We have people coming, as you know, from five different
states to Oklahoma, because in their areas, it is not as
functional, all right? And so, what happens, some of the food
banks for a sense of efficiency, some of the dollars were sent
to food banks in these last two programs--in the last two
phases. By being sent to food banks, then organizations then
have to qualify through the food bank in order to pick up from
them or to be considered a hub. What would make it more viable
is if the people who are actually getting the work done in
integrity--there have been people who have taken advantage of
the system--but who are operating in integrity and getting the
food out to the people where they belong, I believe that it
will continue to be a good program.
As far as the last mile is concerned, it goes back to
transparency and accountability. If those vendors were awarded
monies that included last mile delivery--so, if for me, I am
sending out to different places, then from me, then that person
who is doing that work, networking with other people, should
get that last mile.
And so, how do we continue to do so? By percentages. It is
documentable. They know how many trucks that they are
delivering. They know where the trucks are going. They know how
much is being disseminated and what is not being returned to
them. That is an easy, easy fix. By allowing some of the cold
storage, which they have had refrigerated trucks, if they would
allow some of the cold storage to include thermal blankets, so
in some of the really--because our communities are so rural,
they can't afford to get a semi-truck. If they would allow
thermal blankets to suffice in cold storage, we would be able
to get it out quicker. And if they would underwrite the cost of
providing those blankets to individuals who are picking up and
then taking to other people. Our community is less than 2,000,
and so, there are lot of seniors who are homebound, and we need
that service. We actually do. But it is wonderful.
And something to help our volunteers. I would say that,
too. Our community has come together, yes.
Mr. Mann. You don't feed one million people without a lot
of volunteers, so thank you for that.
My second question, this one is for Mr. Haynie.
Mr. Haynie, in your testimony, you mentioned that you have
formed partnerships with land-grant universities. We all know
that land-grant universities play an important role in
educating our next generation of farmers. Can you talk more
about your partnership with these land-grant universities, and
how they have helped?
Mr. Haynie. Well, I mentioned partnerships with
corporations and in our local and state agencies. But we have
relationships with the land-grant universities where we have--
National Black Growers Council has a field day strategy, and we
want to work with those land-grant universities to bring the
agriculture community, who typically is not serviced--they can
come out and see the latest and greatest that agriculture has
to offer. What corporations have to offer as far as seed and
chemistry and technology, these communities are often not
served by the salesmen who would typically go to the White
farmer who is the larger spender and the bigger accounts. They
take all this information there, and oftentimes, they drive
right past the driveways where Black farmers exist. We wanted
to make sure that we were a conduit and a pipeline for
information for the Black farm community to be aware of
everything that is available in production agriculture.
Mr. Mann. Great, great. Thank you, both of you.
Mr. Chairman, I yield back.
The Chairman. Thank you very much.
I now recognize the gentlewoman from Arizona, Mrs.
Kirkpatrick, for 5 minutes.
Mrs. Kirkpatrick. Well, good afternoon from Arizona. Thank
you, Chairman Scott, for bringing us together with this panel
on such an important topic.
I grew up in the White Mountain Apache Reservation in rural
Arizona, and was raised in a ranching family, so I know just
how important these USDA programs are for farming and ranching
families.
In my State of Arizona, there are more Native American
farmers than any other state, and I want to mention the unique
challenges they face in getting access to USDA programs. Just
as heirs property created a barrier for Black farmers getting
financial aid from farm loans, Native American farmers have
also struggled to participate in USDA programs due to the
nature of land ownership of Indian trust lands.
For Native American farmers, historical program rules
requiring land ownership for eligibility have prevented them
from accessing the assistance they need to develop their land.
A common thread in all of the testimony today is that these
obstacles create systemic inequity. Not surprisingly, due to
these systemic inequities, White farmers are 70 percent more
profitable than Native American farms, despite Native American
farms being over twice the size.
First, Mr. Chairman, I would like to ask unanimous consent
to include in the record a 2019 report by the GAO describing
the needs and barriers to agricultural lending on Tribal land.
The Chairman. It is done without objection.
[The report referred to is located on p. 375.]
Mrs. Kirkpatrick. Thank you so much.
So, my first question is for Mrs. Sherrod. I am moved by
your testimony, and I am so sorry to hear about this grim
anniversary of your father's death. It saddens me to hear that
you never received justice in your father's case. I am also
very troubled by the problems you detailed that still plague
the USDA today, and continue the cycle of inequity.
So, here is my question. Can you describe some things that
the USDA can do to improve its outreach to Black farmers, and
what are the main barriers to Black farmers accessing USDA
programs?
Mrs. Sherrod. Let me say that working with community-based
organizations, we are on the ground. We have been working with
them to help change their situations, in spite of all the
issues they face with USDA. I think it is very important--that
is why we fought for Section 2501 way back in the 1990s to try
to get funds specifically targeted to minority farmers and
through community-based organizations and 1890 land-grants.
That program is now serving everybody. They have thrown the
kitchen sink towards that program so that Black farmers are not
getting the benefit of something we fought so hard to get
passed. There are so many different barriers now because people
have been kept out of the agency. You have to make them feel
they can come back there for help, and that can happen if you
work with people on the ground who are working with them. USDA
is there but they need us, and we can help turn that around,
but we can't get the funding to do it.
Mrs. Kirkpatrick. They do, indeed, need you, so thank you
for recognizing that.
My second question is for Mr. Rowe. I am inspired by your
testimony today and by your decision to become a first-
generation farmer. Further, I can only imagine the difficulty
in not only starting a farm completely from scratch, but going
through the process to ensure you are producing organic crops.
From my conversations with farmers back home, I know that
going through the organic certification process is something
that scares a lot of farmers off, or they don't know where to
start, even if they are already operating under USDA organic
practices. Can you describe for us some of the reasons you
chose to produce organically, and if you see an opportunity to
help more Black farms through the USDA organic certification?
The Chairman. I am going to have to ask if you might be
kind enough to reply in writing. We are way past the time. I
deeply appreciate your consideration. We want to get every
Member in this important hearing.
So, now I recognize the gentleman from Iowa, Mr. Feenstra,
for 5 minutes.
Mr. Feenstra. Thank you, Chairman Scott and Ranking Member
Thompson.
First, I just want to thank each of the witnesses for their
testimony today and sharing the experiences you, your family,
and your friends have faced. I appreciate you saying these
things, and I also definitely appreciate the Secretary of
Agriculture, Mr. Vilsack, for being here today. He is from my
home state, and I appreciate that.
Mrs. Cotton, in your testimony you speak to the importance
of local community organizations in relaying USDA resources.
Can you expand on how USDA could better engage with community
organizations and non-governmental organizations to conduct
outreach and to implement USDA training programs?
Mrs. Cotton. Absolutely. We have land-grant--thank you so
very much for that question and for the opportunity.
We have land-grant universities here in Oklahoma through
which, as Mrs. Sherrod just talked about, the Section 2501
programs. We have that available to us that we can partner with
the USDA. They are educational institutions and they are
established as minorities, and so it would be wonderful if
through those university's programs with existing community
outreach programs, they would partner together in order to be
the hands and feet--or rather, the boots on the ground for the
people in the communities. They are big enough to partner with
the USDA offices in all of their branches, FSA, NRCS, RD, in
order to talk to the people in their language and kind of break
it down, break it down from what the government expects, break
it down to its simplest denomination so everyone can understand
it, and then they be there to help walk the people through
giving technical advice without coming back and saying yes, you
did it right. Let's follow up on that. Let's follow through to
see that it was successful are two different things. By
partnering with the USDA and the land-grant universities, we
can do that. They can absolutely create educational programs
that can go out to the field and then be applied to those in
the communities.
Mr. Feenstra. I appreciate that, Mrs. Cotton, and so, I am
just curious. In Iowa, we have the Iowa Extension Service that
does some of this that sort of works together. I didn't know if
the extension service is available in your area or not. This is
pretty big for our area, for our farmers, and I find it--I am a
local farmer here. My family is, and we use that extension
service a lot.
Mrs. Cotton. The extension services are available to us.
OSU extension is available to us in the area, but when it comes
to combining the two programs, they focus more on the
agricultural side--actually the agricultural side, but the
implementation of USDA programs needs the partnerships
primarily with land-grant universities that are historically
underserved.
Mr. Feenstra. Yes. No, I appreciate your comments and I
agree 100 percent with you. I would love to work with the
Chairman and things like that on trying to figure out how that
partnership can occur. I have a land-grant university in my
state also, Iowa State University, and they are very big into
agriculture and trying to figure out how we can help one
another, and continue to expand, especially in diversity.
So, thank you so much for your comments, and Mr. Chairman,
I yield back. Thank you.
The Chairman. Thank you very much.
Now, I recognize the gentleman from Georgia, Mr. Sanford
Bishop, for 5 minutes.
Mr. Bishop. Thank you very much, Mr. Chairman. Let me thank
you so very much for holding this historic hearing on the state
of Black farmers in the United States. Let me thank you for
bringing together such a tremendous panel to help us understand
how we can bring equity to Black farmers. Let me thank
especially Secretary Vilsack for his commitment to bringing
equity. I want to also thank him for his efforts to reconcile
with Mrs. Sherrod, who was once in the Administration where he
was Secretary of rural development for Georgia. I want to
welcome the other witnesses from Georgia with whom I have
worked, and am so delighted that they were able to testify, and
for Mrs. Cotton and Reverend Cotton, I want to welcome you. I
am delighted to meet you.
Let me go back to what was just raised with regard to
outreach and advocacy. One of the tremendous needs for Black
farmers to be able to fully access the resources of USDA is to
know what resources are available and how to get to them.
Advocacy and outreach is extremely important, and of course,
the Office of Partnerships and Public Engagement is performing
that function, and I think under the previous Vilsack-run
Department the advocacy and outreach function was performed
there.
But it seems to me that to bring together the 1890s, the
land-grants, the community-based programs, the Section 2501
programs, you need to have within USDA a focused office of
whose sole responsibility is to make sure that that outreach
happens in each and every subagency of USDA, Farm Service
Agency, Rural Development, Rural Housing Service, Rural
Utilities Service, NRCS, marketing, the export opportunities,
research, and the opportunity to develop young farmers. The
1890s National Scholars Program, for example, the internship
programs, all of these things are vitally important, but
somebody at USDA--and right now, I think it is being done by
the Office of Partnerships and Public Engagement--but I would
like to ask the Secretary if he can assure us--and I
congratulate him on Deputy Secretary Hairston--who we hope will
soon be confirmed, to work with him to make this happen.
Can you comment on that briefly, Mr. Secretary, and then I
would like to--if you could be brief on that, to ask Mrs.
Sherrod and Mrs. Cotton to comment on the impact and experience
that they have had as Black women farmers.
Secretary Vilsack. Mr. Chairman, thank you very much for
the question. The answer--the quick answer is yes, and we know
this works because on advice that Shirley Sherrod gave me in my
last time at USDA. We did create the Strike Force Initiative
that she made reference to. It ended up operating in over 20
states and made over 200,000 investments. This system works. We
need more of it.
Mrs. Sherrod. And I want to add that as a female in the
field of agriculture, working with farmers and farming, we made
major contributions, just let me say that. I have gone from
having to sit down with the farmer and help him understand what
it meant to change--for example, if I go back years from the
old allotment program with peanuts to the--well, I won't go
back that far. But farmers are focused on farming. Women focus
on the business as well, and when you put those together, we
can make progress. We also plan and are developing cooperatives
and looking at markets and helping our farmers to transition
from row crops when they don't have enough land. We make those
contributions to this work that no one really recognizes.
Mrs. Cotton. And let me add to that. In addition to all of
that, we do the actual work: haul the hay, fix the fence, work
the cows. But when we go into the offices, I have had to even
prove--I am 411", you all--and I have had to go in and show
video of me staging hay because they said there was no way that
I could do it.
The Chairman. I am sorry, but the time of the gentleman,
Mr. Bishop, has expired. I am sorry.
Mr. Bishop. Thank you very much.
The Chairman. Now, I recognize the gentlewoman from
Minnesota, Mrs. Fischbach, for 5 minutes.
Mrs. Fischbach. Thank you, Mr. Chairman. I appreciate the
opportunity and I thank all of the testifiers for being here
today. It has been very, very interesting.
I just have a couple of questions for the Secretary. I have
heard a couple of the testifiers mention passing on the farm
and several generations worth of farming, and Mr. Secretary,
the Biden Administration has been talking about potentially
making some changes to the calculation of the stepped-up basis.
I am wondering if you could maybe comment on that, on how that
might affect some of these folks that are trying to pass on
that farm, particularly in the socially disadvantaged
communities?
Secretary Vilsack. Congresswoman, I have not had an
opportunity to visit with anyone in the Biden Administration on
the issue of stepped-up basis. I do know that it is an
important aspect of the countryside where people who pass away,
the appreciation of their farmland is essentially not taxed,
not subject to income tax, and it provides an opportunity for
transfer to the next generation. I am happy to look into that
issue and find out more about it, but I am sorry to say I am
not prepared to respond to that question today. I didn't
anticipate that one.
Mrs. Fischbach. And Mr. Secretary, I would appreciate that.
Just--like I said, as we were talking, some of the testifiers
were talking a little bit about those generational farms, and
so I just thought that that might be something that would be of
concern.
But Mr. Secretary, just one other thing. Congressman Bishop
was talking a little bit about some of the outreach. I was just
kind of wondering if maybe you could expand a little bit on
some of that, and what kind of outreach is being done on some
of the existing programs to make sure in particular that
younger generation of farmers, but, with an emphasis on those
groups in the socially disadvantaged communities?
Secretary Vilsack. Well, obviously COVID has made somewhat
of a different situation over the last year, but historically,
I think the panelists have basically put their finger on the
real problem here, which is that it is very, very hard for
farmers to initiate the conversation that leads to providing
the technical assistance and outreach if you don't trust the
people that you are asking for help. And that is the
fundamental issue here, one of the fundamental issues. We have
to restore trust out on the countryside. And frankly, we can't
do that--in my estimation, we can't do that by walking in to--
or walking on the farm and saying, as we say, hi, I am here
from the government. I am here to help you. We have to walk on
the farm with someone who they trust. It can be a community
building organization, a land-grant university, extension,
whatever it might be, and basically say we are here to listen.
We are here to learn how we can help you. And then, there has
to be a commitment to make it a successful relationship and
transaction. It can't be just we listen and then we give you 15
reasons why it won't happen. We have to figure out ways in
which we take care of each one of those reasons and ultimately
get to success so that people recognize that there is a reason
for the Federal Government; there is a reason for the
Department of Agriculture; that we are there to help and it
creates the relationship that ultimately leads to further
opportunities.
I think it starts fundamentally with building trust, and I
think that starts with making sure that we are not alone when
we go providing assistance and help, and that we listen, that
we respect and acknowledge the reason why they are distrustful.
It is absolutely rational what we are dealing with here.
Mrs. Fischbach. And Mr. Secretary, I appreciate that and
because we have existing programs, we just have to make sure
that there are programs within the USDA and I just want to make
sure that we are making sure that people are aware of those,
and I appreciate the issue of the trust and that you will be
reaching out in that way with a trusted individual with you, or
however you determine that is going to be working.
But thank you very much, Mr. Chairman. I appreciate the
opportunity, and I yield back my whole 45 seconds.
The Chairman. Wonderful. Thank you so much.
I now recognize the gentleman from Florida, Mr. Lawson, for
5 minutes.
Mr. Lawson. Thank you, Mr. Chairman, and I am delighted
that you called this hearing. I want to thank you all and I
want to welcome the witnesses here.
I know that there have been a lot of questions today, but I
am interested to ask Mr. Boyd that when you talk about all of
the problems that we have had, especially with the relationship
between Black farmers and USDA, what mechanism should we be
doing now? We have a new Secretary in now to help rebuild the
relationships.
Mr. Boyd. Thank you very much for the question. I tapped on
it a little bit earlier, and everybody has today. Outreach and
technical assistance, and building trust. We have 116,000
members in 46 states, and we are overwhelmed with just
inquiries on all of this stuff. There has to be better
communication, and I am going to say this to Secretary Vilsack,
who I have an enormous amount of respect for. Organizations
like the National Black Farmers Association have to be engaged
at the highest levels at the United States Department of
Agriculture if this thing is going to work. When you are
forming these committees and you are having these inside
panels, we need to be at the table, too, so we can make sure we
are injecting the right information. The government can't fix
itself. The fox can't watch the henhouse here. You got to have
some people at the table on the outside of these groups at the
table to help advise and make sure that we do this thing right,
that we get it right this time.
So, we have a wonderful opportunity here, I believe, to do
some great things here in the next 4 years, and the only way to
do that is work collaboratively together in an expeditious way,
because right now, we are facing extinction. Our farmers are
hurting and they are looking for answers, and they are looking
for next steps. I am looking forward to working with this
Administration to putting all of those things in place,
especially the outreach and technical assistance piece.
Mr. Lawson. Okay, thank you very much, and Mr. Secretary, a
year ago or 2 years ago when Mr. Perdue was Secretary, I
brought him down to Tallahassee to Florida A&M University to
speak with the agricultural department at the HBCU and he was
very helpful on a lot of things that he said that they were
going to do. I just wanted to ask you, Mr. Secretary, how do
you intend for your agency's support in these Black students,
Black women, Black veterans who are trying to enter into the
agriculture industry for the first time?
Secretary Vilsack. Well, I think there is tremendous
opportunity with resources that have recently been provided to
really expand and to deepen our commitment to internships.
Getting these young people to be connected to the USDA in a
variety of different mission areas, so they have experience,
they develop relationships, they develop an understanding and
appreciation for the opportunities that may exist. And then
basically make sure that, that it is connected potentially, to
a job opportunity. We have a tremendous internship program.
Chairman Scott, is a great supporter of that. Chairman Bishop
is a great supporter of that. I would anticipate and expect
that we will continue to have support for that effort to link
internships with job opportunities, and I think that is one way
of getting people involved and active.
The second way, there is a program called Together We Grow
that is currently working out of Colorado State University, but
it includes historic Black colleges as well, and they are
working collaboratively with agribusiness, with the USDA, and
other entities to try to expand opportunities for minority
students in all of agribusiness. I would say that the USDA
probably should be looking for ways at some point to link up
with that effort or similar efforts to make sure that
agribusiness is also engaged in this outreach effort.
Mr. Lawson. Okay, thank you very much. I have about 40
seconds, but I want to ask Mr. Rowe, how do you get more Black
farmers interested in organic farming? Did anyone----
The Chairman. Is Mr. Rowe----
Mrs. Sherrod. One thing is to help farmers like Mr. Rowe
become successful. He hasn't been able to access financing
through the agency. Helping him--he is an example for so many
others, and there are other examples out there. We need to
really help them and showing that there is a possibility.
The Chairman. The time of the gentleman has expired,
unfortunately.
Mr. Lawson. My time has expired, Mr. Chairman. I yield
back.
The Chairman. Now, I recognize the gentlewoman from
Illinois, Mrs. Miller, for 5 minutes.
Mrs. Miller. Thank you, Mr. Chairman. I have a question for
Mrs. Sherrod.
You make the statement in your written testimony that the
USDA has been the driving force behind the steady decline in
the number of Black farms and Black-owned farmland. I was just
curious could you specifically expand on what you mean by that
statement, and then give me what your prioritized solutions
would be?
Mrs. Sherrod. Okay. Well, I can give you lots of
information on justifying the statement that I made, going back
to our own farm, going back to land that an organization we
have to create as an answer to land being taken. We created the
First Community Land Trust and the discrimination we faced by
USDA caused us in 1985 to lose 6,000 acres of land. A White
farmer can want your property--and I have worked on so many
cases like this--and the next thing you know, you are in real
trouble with the agency if you are a borrower. I have seen it
happen so many times. I have worked through so many of those
issues through the years, and again, having people who the
farmers trust and willing to get to know the various programs
that they need to access, and helping them to do that is part
of the answer to this. Because there are so many programs out
there they can take advantage of, but they are afraid to try to
even go to the agency. There is no trust there, and they think
it is a place where they will definitely lose their land.
Mrs. Miller. Okay, thank you. I yield back, Mr. Chairman.
The Chairman. Oh, awesome, Mrs. Miller, thank you very
much.
And now, I recognize the gentleman from Illinois, Mr. Bobby
Rush, for 5 minutes.
Mr. Rush. I want to thank you, Mr. Chairman, for this
outstanding and historic hearing that is shining a bright light
on one of the longstanding problems that we have in our nation.
Mr. Chairman, I am currently reading a book entitled, The
Color of Money: Black Banks and the Racial Wealth Gap, by
Mehrsa Baradaran, and one particular passage in the book that
really resonated with me as I prepared for today's critical and
long overdue hearing goes like this, and I quote, ``When the
Emancipation Proclamation was signed in 1863, the Black
community owned a total of 0.5 percent of the total wealth in
the United States. . . . more than 150 years later, that number
has barely budged--Blacks still own only one percent of wealth
in the United States.'' When Martin Luther King stood on the
steps on the Lincoln Memorial in 1963, he said, and I quote,
``America has given the Negro people a bad check, a check which
has come back marked `insufficient funds'. Yet, despite a
century of honest toil--the check has continued to involve
insufficient funds.'' And Mr. Chairman, it is clear from
today's hearing that Black farmers exemplify how the Black
community has received and still receives an NSF check.
I want to thank all the witnesses before us.
Mr. Chairman, I want to ask Secretary Vilsack. Secretary
Vilsack, I am honored that you are committed to prioritizing a
diverse team into addressing the longstanding racial equity
issues the vast majority of Black farmers and Black-owned
farmland. Secretary Vilsack, I have a number of questions here.
Will you expand upon the concrete steps that you are taking to
foster trust and ensuring the timely access to capital for
Black farmers? Include Title 9 in that. Do you need any
additional authorities from Congress to enact policies to
directly help struggling Black farmers and to reverse the
impact of decades of discriminatory practices in the USDA? It
is my understanding that there is currently insufficient
transparency regarding assistance to farmers based on race. To
that end, I would like to know, can you tell me the number of
Black farmers who bought crop insurance policies in 2019
compared to White farmers? Can you tell me how much Black
farmers received in premiums or income support compared to
White farmers? Can you tell me how many part-ownership Black
farmers received farm ownership or operating loans in 2019
compared to White farmers? Given the decades of discrimination
that have led to the vast majority of Black farmers having to
sell their farms, can you support [inaudible] on subsidies and
loans available to Black farmers?
Mr. Secretary, can you answer any or most of those
questions?
Secretary Vilsack. Congressman, I am happy to provide you
the data on the last question you asked concerning transparency
to the extent that we have it. I know, for example, from 2017
to 2020, there were 2,131 direct loans to socially
disadvantaged farmers, approximately $112 million went out.
That I know. I am happy to provide you with information on
that.
I don't know that I necessarily need more authority, but I
am interested in knowing what the Equity Commission and our
internal review pursuant to President Biden's Executive Order
will identify, and we may come back to you asking for
additional authority.
In terms of specific steps, over the course of the next 6
months, I think we are going to take--we are going to learn a
lot. We are going to take an effort to try to better connect
with the historic Black colleges and other community building
organizations with the resources you have provided in the
American Rescue Plan, and I would anticipate and hope that we
have--to begin the process, and I emphasize begin, begin the
process of improved outreach as a result of the Section 1006
money that is provided in the Rescue Plan.
The Chairman. Thank you very much.
Mr. Rush. Mr. Chairman, I ask for unanimous consent to
enter into the record the quote from the book, The Color of
Money: Black Banks and the Racial Wealth Gap, by Mehrsa
Baradaran who I referenced earlier in my testimony. Unanimous
consent.
The Chairman. It is so done without objection.
[The excerpt of the book is located on p. 348.]
Mr. Rush. Thank you.
The Chairman. Thank you, Mr. Rush.
Ladies and gentlemen, it looks like we have entered the end
of our Members' questions. And so, what we want to do now is
have concluding remarks from my Ranking Member, Congressman
Thompson, and myself.
But let me just say this, please. This has been
extraordinary. When I opened this hearing, I opened it with the
precious words of the Lord, as was expounded by his great
apostle, Paul. When Paul wrote that all things come together
for good to them who love God, and to them who are called
according to God's purpose. Ladies and gentlemen, we have done
that today. And I just want to say from the bottom of my heart,
thank you, and God bless you. I want you to know that this
testimony that we have had today will become the basis, the
foundation of the legislation that we are working on in our
Committee right now to address racial discrimination against
our Black farmers, and it will be on two major foundations, all
of what you said. We will make it wrong, unlawful for all and
each of the discriminatory practices that you all have outlined
to us will be in this legislation, written into law that never
again will we have any of the discriminatory practices that you
all have exposed for us today within our United States
Department of Agriculture. But this legislation isn't going to
stop there, because the fundamental problem that we have is to
make sure that we increase the market share of the products
that our Black farmers are bringing and producing to the
agricultural market. We are going to have some incentives in
there so that we can increase that. We will also have things in
this bill that will increase the number of Black farmers we
have, the acreage we own, but we had to hear from you first,
and you have outlined God's purpose that He has brought you and
me and this great Committee together.
And so, right now, I want to introduce and have my partner,
because let me tell you this. You didn't just hear from
Democrats today who said they are concerned to eliminate the
racial discrimination. You heard from Republicans. And let me
tell you something else. That great Republican, Abraham
Lincoln, who freed the slaves, he not only did that. When he
created the Agriculture Department, it was Abraham Lincoln who
said this is the people's department. Abraham Lincoln said
that. I think that, and his freeing of my people and our Black
people makes him the final statement that I want to make before
I introduce my Republican friend. Because let me tell you all
this. We talk about that 1890s land-grant African American
colleges and universities. It was a Republican Senator named
Senator Morrill. It was the Morrill Act that established the
land-grant colleges in 1860, and then after Plessy v. Ferguson,
that is when it was separate but equal established. And
everywhere there was a White land-grant by law, it was the same
Republican Senator Morrill and it is called the Morrill Act. It
was he who established the 19 land-grant colleges and
universities. That is why I am telling you, man, we did God's
work in here today, Republicans and Democrats together, and
Republicans and Democrats are going to put this bill together
that is based upon what you all have testified and asked us to
put into this bill.
And now, with that, I want to present my distinguished
partner and the Ranking Member, Congressman Thompson.
Mr. Thompson. Well, Mr. Chairman, thank you, David. I
appreciate the partnership as we work for this amazing industry
of agriculture that provides the food and the fiber, the
building materials, construction materials, all come off of
agriculture land. I would like to say without a robust rural
economy, every American is going to wake up in the cold, dark
and hungry. And so, thank you for this hearing today. I thought
it was a great hearing.
First of all, thank you to all of our witnesses. Your
written testimony, your oral testimony was compelling. It was
insightful. You made it passionate and personal, and so, I
think we succeeded. And so, thank you to each and every one of
you. Thank you to all the Members that weighed in and
participated and asked thoughtful, insightful questions. I
would be remiss, if both the Chairman and I wouldn't say thank
you to all the staff, both Committee staff of both parties, and
quite frankly, the agriculture staff of these individual
Members who put their heart and soul into working on this
issue.
This is a conversation that was long overdue, and the fact
that we have elevated this, we have had this conversation we
have--if we are going to really achieve that vision that I
think we share of restoring a robust rural economy, that means
we have to lift everyone up and we can leave no one behind. I
think the discrimination that we have seen a record of in the
past, the documentation, whether it was systemic in terms of
policy or whether it was the attitudes that were unacceptable,
just cruel attitudes that certain folks perhaps had that had
authority at USDA. Their time has passed. I am confident we
have a Secretary that will be a great partner with us as we go
forward. I am confident that we will learn from this, and the
practices that we have in place.
I am also very proud of what we have done in the past
couple farm bills in terms of the set asides that we put out
there for Black farmers and socially disadvantaged farmers, and
so, I think we have momentum. We got great momentum, but we
need to build on it, and I think we just have the right farm
team together, let me put it that way, to be successful.
So, once again, thank you to all the witnesses. Mr.
Chairman, thank you. I yield back.
The Chairman. Thank you. Yes, and I wanted to just use my
closing remarks to thank this panel.
Secretary Vilsack, God bless you, my friend. You came and
you stayed for this entire hearing, and you heard what I heard.
And the reason that is so important is that you and I and our
Committee, along with this testimony that we have heard from
Mr. John Boyd, from Mrs. Shirley Sherrod, from Mrs. Arnetta
Cotton and Earrak Cotton, from Cornelius Blanding, from Sedrick
Rowe, and from Philip Haynie, what a blessing that God has
given us with the wisdom, the information that these
individuals have given to you and me and this Committee. Now
our charge is to take this wisdom, take what they are asking us
to do.
This bill that we will be working on to end, end racial
discrimination in the United States Department of Agriculture
and in our wonderful world of agriculture, our entire industry,
we will be able to do. And let me assure you, this is truly
God's work, and I want to thank again my Republican partner,
because he and I have to put this bill together. But we
couldn't do it until we heard from the Black farmers, and that
is what we will base this on.
Mr. Secretary, I want you to know from me personally what
your participation in this hearing means. Not just from me, not
just for our Committee, but the entire nation to see you here
because so many of these charges of racial discrimination were
laid at your feet. This is why it is so important that we
recognize your participation and the fact of your willingness
to be the leader in making sure that your Agriculture
Department of which you lead will eliminate all vestiges of
discrimination. I couldn't do it. None of us can do it. The
only one that can make sure, regardless of what we put in the
law or paper, is because we have the Secretary of Agriculture
that is built on the legacy of the man who put our agriculture
together, and who freed Black people from the vestiges of
slavery when he called the Department of Agriculture the
people's department. Abraham Lincoln did that, and that is
whose shoulders we stand on this day. And I thank you so much
for being a part of this. God bless you, and God bless this
panel. Thank you.
Under the Rules of the Committee, the record of today's
hearing will remain open for 10 calendar days to receive
additional material and supplementary written responses from
the witnesses to any questions posed by a Member.
This hearing of the Committee on Agriculture is adjourned.
Thank you.
[Whereupon, at 4:29 p.m., the Committee was adjourned.]
[Material submitted for inclusion in the record follows:]
Submitted Letters by Hon. David Scott, a Representative in Congress
from Georgia
Letter 1
on behalf of james bunch, president/chief executive officer, bunchology
llc
March 24, 2021
Hon. David Scott,
Chairman,
House Agriculture Committee,
Washington, D.C.
Subject: Agricultural Outreach Project To Increase the Number of
Black Farmers in the U.S.
Dear Chairman Scott:
Bunchology LLC is a disadvantaged small minority owned business
eligible for contracts and grants from the U.S. Government. The owner
is an American with a disability. Eliminating food deserts and
increasing the number of Black farmers is a must during this critical
time in our country. I would like to make you aware of the following
project that will help the Administration address these concerns and
build back better. The title of this Initiative is: ``How The Hip Hop
Farmers Youth Initiative and the Divine Nine (Black Greek
Organizations) Can Help The Administration Build Back Better By
Tackling Food Deserts In Historically Underserved Communities''. This
project will create approximately 2400 jobs for economically distressed
and poverty stricken communities. It will be a multi-state (25) and
multi-million dollar Initiative.
President Biden often speaks of how he is keenly aware that Black
Americans played a major role in his victories and that he is committed
to addressing their specific concerns. He has often stated that he will
ensure that Black businesses will receive their fair share of
government contracts and agreements during his Administration. Several
months from now when the President and Vice President are going around
the country highlighting their accomplishments specifically for the
Black community, my goal is for this project to be one of their stops.
In light of President Biden's Executive Order ``On Advancing Racial
Equity and Support for Underserved Communities Through the Federal
Government'', I believe this Initiative would address his commitment to
be Bold and Go Big!
Therefore, my ask of you is that you please share the attached
Proposal through the proper channels with Secretary of Agriculture Tom
Vilsack and Deputy Secretary of Agriculture Jewel Bronaugh. I am
seeking a Cooperative Agreement with the Department to fund my Project.
I respectfully request a written response from the Secretary within 15
days from the date of this letter.
I would like to thank you for your assistance with this request.
Please do not hesitate to contact me if you have any questions or need
additional information.
Warmest Regards,
James Bunch, President/CEO
Bunchology LLC
Cc:
Theodis Bunch, USDA Retiree, Pine Bluff, AR
Orlando Phelps, USDA Retiree, Hermanville, MS
Clifton E. Peters, USDA Retiree, Lorman, MS
Eddie L. Bunch, USDA Retiree, Carlisle, AR
Willie J. Terry, USDA Retiree, Greenville, MS
attachment
Summary
Project Title: How the Hip Hop Farmers Youth Initiative and the
Divine Nine (Black Greek Organizations) Can Help the Administration
Build Back Better By Tackling Food Deserts in Historically
Underserved Communities
Project Start Date: October 1, 2021
Project End Date: September 30, 2022
Bunchology LLC was developed by James Bunch, President/CEO to
provide the following services to the U.S. Department of Agriculture:
Increase the number of New and Beginning farmers among historically
underserved groups/individuals such as Veterans, Community Based
Organizations, and socially disadvantaged youth. Provide technical
assistance and training to these groups/individuals on how to start a
business in vegetable crop production utilizing the Seasonal High
Tunnel System.
The collaborators for this project will be one hundred (100)
historically underserved farmers, land-grant colleges and universities
and one hundred (100) Divine Nine local Black Greek chapters located
throughout the twenty-four (24) states and the District of Columbia.
Selected states include Alabama, Arkansas, California, Florida,
Georgia, Illinois, Indiana, Louisiana, Maryland, Michigan, Minnesota,
Missouri, Mississippi, New Jersey, New Mexico, New York, North
Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas,
Virginia, Washington, D.C., and Wisconsin. The critical need for this
project is due to the lack of the availability of healthy foods (fresh
fruits and vegetables) in these communities which are impacted by food
deserts. A team of twelve (12) retired USDA professionals will provide
the leadership/expertise to ensure the development of one hundred (100)
demonstration farms to include the construction of two hundred (200)
seasonal high tunnel systems (30 x 72) to facilitate the production
of fresh fruits and vegetables and training to project participants.
Expected outcomes:
Increased availability of fresh fruits and vegetables in the
targeted states[;]
Economic boost in the targeted area due to job creation
(approximately 2,400)[;]
Increase in the number of new and beginning farmers among
historically underserved groups (approximately 100); and
Increase in students pursuing degrees in the food and
agricultural sciences, thereby increasing the pool of
candidates eligible for USDA career opportunities.
Contact:
James Bunch, President/CEO
Bunchology LLC
Phone: 901-315-6008
Email: [email protected]
Letter 2
on behalf of webster e. davis, senior policy advisor, family farm
action
April 4, 2021
Hon. David Scott,
Chairman,
House Agriculture Committee,
Washington, D.C.;
Hon. Glenn Thompson,
Ranking Minority Member,
House Agriculture Committee,
Washington, D.C.
RE: A Hearing to Review the State of Black Farmers in the U.S.
Family Farm Action would like to thank Chairman Scott and Ranking
Member Thompson for convening this hearing to review the state of Black
farmers in the U.S. Discrimination against Black farmers is sewn into
the fabric of U.S. agriculture. In 1910, Black farmers owned 16 to 19
million acres of land and made up 14% of America's farmers, while in
2017 Black farmers operated on just 4.7 million acres of farmland and
accounted for 1.4% of farmers in the U.S. Much of this land loss can be
attributed to discriminatory lending, particularly by the hands of
USDA. We are grateful that Congressional hearings on the issues faced
by Black farmers were held, as increasing awareness and dialogue is key
to the proper courses of action.
By calling for this historic hearing, it is clear the Members of
this Committee recognize the need to address systemic racism in
agriculture, and to work together to begin rectifying it. We are also
encouraged by Secretary Vilsack testifying and confronting the
discriminative actions toward Black farmers by the hands of USDA. The
Secretary's commitment to rooting out this behavior in the agency, and
affirming that racism and discrimination have no place in the
agricultural sector on the whole. While encouraged by these
commitments, we know that racism is pervasive and is experienced by
Black farmers across this nation. We hope the testimony we hear today
will bring about action and justice for Black farmers.
The provisions in the American Rescue Plan Act of 2021 set a well-
rounded approach and build the solid foundation needed to address the
ongoing legacy of systemic racism Black farmers experience in the
United States. We applaud the passage of the American Rescue Plan which
included full debt forgiveness, the creation of an Independent Civil
Rights Oversight Board, and the creation of an Equity Commission.
However, the work of this Committee and the Biden-Harris Administration
has just started.
Historic discrimination and exploitation of Black farmers,
ranchers, and workers must be actively addressed and remedied. Policy
must intentionally create equitable access for BIPOC folks to land and
credit, market opportunities, safe working conditions, a seat at the
policy development table, access to culturally relevant training and
technical assistance, and just treatment by all Federal agencies.
Family Farm Action Alliance issued key policy recommendations to the
117th Congress,\1\ and has continued to request anti-racist development
and implementation of prog[r]ams authorized by Executive Order and the
117th Congress. Those recommendations that specifically call for anti-
racist food and farm policy and that we recommend for your
consideration are included below.
---------------------------------------------------------------------------
\1\ Family Farm Action Alliance. Toolkit for Congress. January
2021. Available at https://farmactionalliance.org/toolkitforcongress/.
Ensure full implementation and outreach of USDA COVID Stimulus
Grants and Food Purchasing Programs authorized in the Consolidated
---------------------------------------------------------------------------
Appropriations Act of 2021 and the American Rescue Plan Act of 2021.
Use every resource necessary to reach all socially
disadvantaged farmers and provide technical assistance to
forgive all currently held loans
Ensure all farmers receive USDA Consumer Data From AD-2047
and technical assistance to complete it, which allows them to
identify as a socially disadvantaged producer, and thus be
eligible for designated programs, funding, and support.
Ensure all farmers receive USDA Program Discrimination
Complaint Form AD-3027 and technical assistance to complete it,
which allows them to file a complaint to USDA in cases of
discrimination.
In the development of the USDA AMS COVID-19 stimulus grant,
we recommend at least 10% of funds be set aside for applicants
in persistent poverty counties as outlined in the Clyburn 10/
20/30 formula,\2\ and a 10% set aside for BIPOC and women-owned
and operated food chain businesses.
---------------------------------------------------------------------------
\2\ Congressman James. E. Clyburn. ``10/20/30 Formula to Fight
Persistent Poverty.'' Available at https://clyburn.house.gov/10-20-30-
amendment.
USDA should hold state and regional meetings inviting state
leaders to determine the best roll out plan for particular
regions and states to help insure an equitable distribution of
---------------------------------------------------------------------------
funds.
Pass the Justice for Black Farmers Act: \3\
---------------------------------------------------------------------------
\3\ 117th Congress: Justice for Black Farmers Act (S. 300).
Forms a Black Farmer Land-Grant through a new line agency at
USDA where land of up to 160 acres would be available to Black
individuals at no cost.\4\
---------------------------------------------------------------------------
\4\ Homestead Acts passed between 1862-1916 granted land in the
amount of 160-640 acres, and prioritized people of European descent
while excluding Black people. ``Forty acres and mule,'' a land-grant
program that passed during the Civil War, granted land to formerly
enslaved men. The program was poorly administered, and was revoked upon
transition from the Abraham Lincoln to Andrew Jackson Administrations.
As other ethnic and racial groups have historically been prioritized in
land-grant programs and continue to benefit from their legacy, it is
appropriate to prioritize Black individuals in a future land-grant
program.
Increases credit access and land retention for marginalized
---------------------------------------------------------------------------
farmers.
Funds historically Black colleges and universities at a
level of $500 million per year for 10 years to expand
agricultural education.
Provides additional funding and technical expertise to
assist with resolving heirship issues for existing Black
farmers.
Strengthens existing antitrust enforcement through the
Packers and Stockyards Act, with the knowledge that food chain
workers of color are additionally vulnerable to economic and
labor exploitation.
Fund 1890 Land-Grant Universities:
Appropriate 1890 college payments and 1890 cooperative
extension funds to the same Federal level as 1862 land-grant
college payments and cooperative extension funds, and require
states to meet the Federal match. Often, 1890 university
appropriations fall short of 100% funding, while 1862
university appropriations often exceed ``full'' funding.
Discontinue the use of funding waivers used by states to
side-step appropriating 1890 universities to the same level as
the respective state's 1862 land-grant college.
Fully investigate claims of state under-funding of 1890
universities and cooperative extension programs.
Support New and Beginning Farmers:
Forgive student loan debt so farmers and aspiring farmers
may pursue agriculture without the massive burden of debt.
Change USDA lending authority to prequalify beginning
farmers for FSA loans, and provide no interest loans to
beginning BIPOC farmers and BIPOC-led cooperatives.
Support All Ownership and Aggregation Structures:
Provide oversight of the implementation of the order for
USDA to examine the impacts of current land tenure disputes
regarding Heirs' property, fractured allotments, and Colonias
as directed in the 2018 Farm Bill.\5\
---------------------------------------------------------------------------
\5\ Agricultural Improvement Act of 2018: Sec. 12607. 7 U.S.C.
2204i.
Fully implement the program to allow operators on Heirs'
property to obtain a FSA farm number as directed in the 2018
Farm Bill.\6\
---------------------------------------------------------------------------
\6\ Agricultural Improvement Act of 2018: Sec. 12615. 7 U.S.C.
6622b.
Order ERS to study and make recommendations on Federal
cooperative ownership standards, to remedy the current state
patchwork policies regarding cooperative establishment,
---------------------------------------------------------------------------
ownership, public-private collaboration, and operation.
Acknowledge Past Discrimination by Protecting Workers and
Championing New Programs:
In the agrifood supply chain, immigrants and people of color
are overrepresented in U.S. food chain worker demographics. In
meatpacking, 44.4% of workers are Hispanic, and 25.2% are
Black.\7\ Food chain workers are often talented
agriculturalists that have not been able to secure land to farm
or safe, secure employment due to monopolistic business
practices. To begin addressing this, create a Federal fund with
mandatory contribution by mega-food chain employers to place
food chain workers who have left due to exploitative conditions
to gain employment in an independent, non-monopolized entity in
the same sector, including payments to current and former food
chain workers who experienced adverse health and exploitative
working conditions.
---------------------------------------------------------------------------
\7\ Shawn Fremstad, Hye Jin Rho, & Hayley Brown. April 29, 2020.
``Meatpacking Workers are a Diverse Group Who Need Better
Protections.'' Center for Economic and Policy Research. Available at
https://cepr.net/meatpacking-workers-are-a-diverse-group-who-need-
better-protections/.
Enact the Safe Line Speeds in COVID-19 Act \8\ to suspend
and not issue any new line speed waivers, and permanently
suspend the implementation of the New Swine Slaughter
Inspection System.\9\
---------------------------------------------------------------------------
\8\ 116th Congress: Safe Line Speeds in COVID-19 Act (S. 4338).
\9\ Federal Register. New Swine Slaughter Inspection System Final
Rule. Vol. 84, No. 190. October 1, 2019. Available at https://
www.govinfo.gov/content/pkg/FR-2019-10-01/pdf/2019-20245.pdf.
Authorize funding to support the creation of racial equity,
diversity, and inclusion priorities in 4-H and other Federal
agricultural discovery programs curriculum so young people are
---------------------------------------------------------------------------
empowered to pursue a career in agriculture.
Authorize the Consumer Financial Protection Bureau to
investigate claims of discrimination by Farm Credit Service
(FCS) institutions, and require FCS to meet SDFR lending goals.
Family Farm Action reaffi[r]ms our deep sense of thanks to Chairman
Scott for convening this hearing, those providing testimony, and the
leadership shown thus far in the 117th Congress to address systemic
racism and discrimination against Black farmers. We know there is much
work yet to be done.
Thank you for the opportunity to provide our testimony and input
for the record. We look forward to working with you as you consider our
recommendations.
Sincerely,
Webster E. Davis,
Senior Policy Advisor,
Family Farm Action.
Letter 3
on behalf of collis jones, vice president, u.s. policy & strategy,
deere & company
March 25, 2021
Hon. David Scott, Hon. Glenn Thompson,
Chairman, Ranking Minority Member,
House Committee on Agriculture, House Committee on Agriculture,
Washington, D.C.; Washington, D.C.
RE: Statement for the Record on ``A Hearing to Review the State of
Black Farmers in the U.S.''
Dear Chairman Scott, Ranking Member Thompson, and Members of the
House Committee on Agriculture:
Thank you for holding this hearing and for the opportunity to
submit these comments on behalf of Deere & Company (``Deere'').
In 2020, Deere joined with other partners in forming an
organization dedicated to improving the livelihoods of Black farmers.
The LEAP coalition (Legislation, Education, Advocacy, and Production
Systems) focuses on addressing the decades-long issue of heirs'
property rights, in which no clear title to farmland is recorded.
In the announcement issued by Deere launching the coalition on
September 15, 2020, the following statement was made by Marc A. Howze,
Group President, Lifecycle Solutions and Chief Administrative Officer:
``Property ownership is a driver of economic growth for individuals and
families. However, too often the benefits of ownership for those who
lack clear title cannot be truly realized.''
Joining Deere in the coalition are the Thurgood Marshall College
Fund, National Black Growers Council and we are partnering with The
Federation of Southern Cooperatives. These partners provide expertise
that complements our company's legacy of serving farmers for nearly 200
years. Further, the coalition builds on Deere's longstanding
relationships with Black farmers and organizations that have
traditionally supported them and also served as forceful advocates for
social and economic justice.
The basic principles defining LEAP and describing its mission are
outlined below:
Legislative:
Support legislation on Heirs' Property reform.
Serve as a conduit or partner in efforts to clearing title
for Black farmers.
Education:
Invest in Fellowships/Internships/Agribusiness paths.
Engage in estate planning to prevent the further
proliferation of Heir's Property.
Advocacy:
Amplify the work of The Federation of Southern Cooperatives.
Raise awareness regarding the issues and challenges
experienced by Black farmers.
Production Systems:
Education and training to support Long-term Sustainability
and Economic viability.
Access to tools, technology and innovation.
Land is a farmer's most valuable and productive asset. Yet a
majority of Black farmers--who make up about two percent of the U.S.
farm population--are believed to operate on property lacking a
documented title. At the same time, the amount of land owned by Black
farmers has fallen sharply, to less than 5 million acres compared with
over 16 million acres a century ago. The decline occurred in large part
due to discriminatory practices affecting how Black farmers acquired
and transferred their land--a form of ownership commonly called
``heirs' property.'' Many landowners also lacked the resources for
formal estate planning and passed property to their heirs without a
will. Over generations, this practice led to increasingly fractional
ownership and unclear titles.
Without such title, farmers cannot use their property as collateral
for loans and often cannot participate in government farm-support
programs or receive emergency or disaster-relief aid. To this end,
securing clear title helps eliminate systemic barriers to land
improvement and wealth building that have constrained many farmers,
particularly those in minority or underserved groups, across the United
States.
Black communities in southern states have been disproportionately
affected by these issues. However, similar situations exist in other
populations and geographies. These include White communities in
Appalachia, Native Americans on Tribal lands, and Hispanic communities
in southwestern United States. Each of these constituencies stand to
benefit from LEAP's work.
Deere has a proud history supporting racial equality as reflected
by our longstanding support for Minorities in Ag Natural Resources and
Related Sciences (MANRRS), the National Black Growers Council, 1890's
land-grant institutions and other organizations supporting Black
entrepreneurs and social justice organizations.
In addition, Deere has engaged in the work of a special committee
on racial equity and social justice of the Business Roundtable. The
group's finance subcommittee, of which Deere's Chairman and Chief
Executive Officer John C. May is a member, focuses on providing access
to capital in minority communities and on other factors contributing to
persistent income disparity.
In our view, Deere is uniquely positioned to help promote public
policy solutions and corporate initiatives that help underserved
farmers gain access to capital and enjoy the advantages that come with
proven land ownership. We believe, moreover, the impact of Deere's
leadership on this issue can be further leveraged through our
participation in organizations such as LEAP.
Deere's partners in the coalition are providing the educational,
legal, and technical resources to help disadvantaged farmers secure
clear title to their land and acquire the technology and tools
necessary to make their operations more profitable, productive, and
sustainable.
Deere has made a number of investments to help ensure LEAP's
success and remove the systemic barriers undermining the success of
Black farmers. Among these is a collaboration with our dealer Tellus
Equipment to fund and support two lawyers working on land retention
efforts, making a 5 year commitment to serve as title sponsor of the
Federation of Southern Cooperative's Heirs' Property Conference and
expand its investment in the cooperative's programming.
In addition, Deere is providing funding for legal interns recruited
through the Thurgood Marshall College Fund to work at the Federation of
Southern Cooperatives. Deere has created a full-time position within
the company to oversee the LEAP effort and ensure its success.
Deere is committed to helping farmers, regardless of size or
background, have access to the vital resources needed to achieve
success and sustain their operations for generations to come. The LEAP
coalition reinforces this goal by addressing the issue of heirs'
property ownership and helping disadvantaged farmers secure clear title
to their land.
Thank you for the opportunity to address these important issues and
to share additional information on Deere's partnership with members of
the LEAP coalition. Should the Committee have any additional questions
for Deere, we welcome the opportunity to speak with you.
Sincerely,
Collis Jones,
Vice President, U.S. Policy & Strategy.
Cc: Members of the House Committee on Agriculture.
Letter 4
on behalf of duane simpson, vice president, north america government &
industry affairs, bayer crop science
February 18, 2021
Hon. Debbie Stabenow,
Chairwoman,
Committee on Agriculture, Nutrition, and Forestry,
United States Senate,
Washington, D.C.;
Hon. David Scott,
Chairman,
Committee on Agriculture,
United States House of Representatives,
Washington, D.C.
Dear Chairwoman Stabenow and Chairman Scott:
Bayer applauds the introduction of [S. 278], the Emergency Relief
for Farmers of Color Act. This critical legislation introduced by
Senators Warnock, Stabenow, Booker, Leahy, Lujan and Klobuchar, and
included in the American Rescue Plan, is an important relief measure as
it would forgive U.S. Department of Agriculture (USDA) loan debt for
farmers of color and provide funding for outreach, research on heirs'
property, and other efforts to assist minority farmers. The $4 billion
in debt relief, and the $1 billion in additional funds, is part of the
$16 billion COVID-19 relief plan, which will add to the approximately
$40 billion farmers have received this past year.
Bayer recognizes the importance of remedying the longstanding
systemic disadvantages facing farmers of color. As documented by
Congress and acknowledged by USDA, Black, Indigenous, and Hispanic
farmers have dealt with limited access to credit and are often left out
of Federal aid. We commend the Members of Congress who have taken steps
to ensure the Federal Government addresses its past mistakes.
We also understand that it is not only just the Federal
Government's responsibility to treat farmers of color fairly. We, too,
continue to have conversations around, and seek to be conscious of, how
our products and programs are meeting the needs of minority farmers.
As a company that serves farmers of every background, Bayer remains
committed to supporting our customers of color as they push for equity
in our food and agriculture system.
Sincerely,
Duane Simpson,
Vice President,
North America Government & Industry Affairs.
CC:
U.S. Department of Agriculture
The Honorable John Boozman
The Honorable Glenn `GT' Thompson
The Honorable Raphael Warnock
The Honorable Cory Booker
The Honorable Patrick Leahy
The Honorable Ben Ray Lujan
The Honorable Amy Klobuchar
______
Submitted Presentation by Hon. David Scott, a Representative in
Congress from Georgia; on Behalf of Bernice Atchison, Farmer from
Chilton
County, AL and Pigford Historian
The Seven Tiers of the Black Folks Plan for Black Farmers
______
Submitted Statements by Hon. David Scott, a Representative in Congress
from Georgia
Statement 1
on behalf of navina khanna, executive director, heal (health,
environment, agriculture, labor) food alliance
April 4, 2021
The HEAL (Health, Environment, Agriculture, Labor) Food Alliance
(HEAL) is grateful for the opportunity to submit written testimony
regarding the recent hearing on the State of Black Farmers.
HEAL is a national multi-sector, multi-racial coalition led by
Black, Indigenous and People of Color (BIPOC) that is building
collective power to transform our food and farm systems for the health
of our communities and the planet. Our 50+ member organizations
represent over two million rural and urban farmers, ranchers, fishers,
public health advocates, farm and food chain workers, Indigenous
groups, scientists, policy experts, community organizers, and
activists. Together, we are creating systems that are healthful for our
families, accessible and affordable for all communities, and fair to
the hard-working people who grow, distribute, prepare, and serve our
food--while protecting the air, water, and land we all depend on.
Our members know too well that the legacies of chattel slavery,
colonization, and the historical and current realities of institutional
racism have direct bearing on the socioeconomic status of Black people
nationwide. Longstanding structural and institutional racism have
excluded Black people from access to land, financial resources,
information, political standing, and educational and professional
trajectories. Such exclusion has prevented truly sustainable food
systems from being established, and created enormous barriers for
communities seeking to maintain or revive culturally appropriate
foodways and to live in balance with their ecosystems. Strengthening
support for Black people within the agriculture sector, on the other
hand, can establish paths toward long-term prosperity while helping to
secure the future of sustainable and resilient food systems.
We commend the House Committee on Agriculture for taking up the
important, long overdue issue of support for Black farmers. Below, you
will find recommendations from our members, and we look forward to
being in continued conversation with your respective staff and
departments as we collectively undertake the hard work of righting
historic wrongs and collaborating together for a future that works for
all people--and the health of our planet.
No one organization, including HEAL, can speak for all Black
communities working across our food and farming system, and we are
aware that we are part of an ecosystem that includes Black agricultural
communities with diverse strengths, challenges and perspectives. HEAL's
analysis continues to be informed by our membership and key leaders in
the landscape such as the National Black Food and Justice Alliance,
Soul Fire Farm, Land Loss Prevention Project and many more unheralded
grassroots leaders. These are the communities that have been doing the
hard work of addressing Black land loss over the last few decades and
fighting for the ability to be in the right relationship with the land
and one another. Below, we offer testimony and recommendations from our
membership.
According to the most recent United States Department of
Agriculture (USDA) Census data, approximately 95% of farmland owners
are white.\1\ For reference, in 1920 the United States had about 1
million \2\ Black farmers; however as of the 2017 Census of
Agriculture, this number is closer to 45,000,\3\ and just 0.52% \4\ of
the total farmland in the country is owned or operated by a Black
farmer. This is a glaring problem and a consequence of a system
designed to dispossess Black people of wealth, and Black farmers of
land. There is a long and detailed history of discrimination by the
USDA and documented efforts by Black farming and civil rights leaders'
to right these wrongs through legal means such as the Pigford cases,
policy initiatives within the farm bill and advocacy at local (state,
county, city, etc.) levels.
---------------------------------------------------------------------------
\1\ https://www.nass.usda.gov/Publications/Highlights/2019/
2017Census_Farm_Produc
ers.pdf.
\2\ http://usda.mannlib.cornell.edu/usda/AgCensusImages/1920/
Farm_Statistics_By_Color_
and_Tenure.pdf.
\3\ https://www.nass.usda.gov/Publications/Highlights/2019/
2017Census_Farm_Produc
ers.pdf.
\4\ https://www.nass.usda.gov/Publications/Highlights/2019/
2017Census_Farm_Produc
ers.pdf.
---------------------------------------------------------------------------
At HEAL, we join our members in support of efforts that aim to
address issues of land access and tenure such as the Justice for Black
Farmers Act. We recommend fully supporting the Justice for Black
Farmers Act and our members' contributions to the legislation are
rooted in the wisdom of lessons from past failures and investment in
steps towards a radical reclamation of what we know our communities
need and deserve. We also support the greater call for reparations for
Black communities. As voiced by some of our members:
Over the past 100 years, 98% of Black farmers have been
dispossessed of their land, driving the median age of the Black
farmer up to 62 years and the share of Black operators down to
1.4%. Passage of the Justice for Black Farmers Act is essential
to right the wrongs endured by our legacy farmers and to
provide opportunities for the next generation of Black farmers.
Soul Fire Farm, a NY-based rural training center for Black and
BIPOC farmers, has observed a clamor of interest for careers in
agriculture and maintains a multi-year waiting list for its
programs. The time is now.
Leah Penniman, Founding Co-Director, Soul Fire Farm.
The National Black Food & Justice Alliance's work to build
Black Land and Power and Self Determining Food Economies is
inspired by and in honor of Mrs. Dorothy Wise, a Black farmer
who made her transition after being forcibly displaced from her
farmland with her husband by armed U.S. Marshalls in 2016 based
on USDA discriminatory lending practices.
Dr. Jasmine Ratliff, Policy Manager, National Black Food and Justice
Alliance.
The U.S. Government can and should focus on an ``invest/divest''
framework, moving away from harmful practices and investing instead in
the sustainability, well-being, and safety of all communities with
community-controlled solutions.
The U.S. Government can make it easier for Black people to access
and retain land by:
Providing grants, subsidies, and incentives to make it
easier to finance and own land. These should include mechanisms
facilitating land ownership transitions, as well as reparations
to return appropriated land and to reverse land-grabs.
Providing legal aid to help Black people access and retain
land. For example, grants from USDA could fund law schools to
offer legal clinics providing free or low-cost, culturally
competent legal services tailored to Black farmers. Given
evidence of ongoing discrimination, the USDA should also
require an independent review of drivers and preventive
measures prior to foreclosures of Black-owned farmland
(Rosenberg and Stucki 2019; Keepseagle v. Vilsack; Cowan and
Feder 2013).* And, government should fund increased legal
support for the formation of cooperative ownership structures
that help Black people access and retain farmland (Taylor 2018;
Calo and De Master. 2017; Gies 2018).
---------------------------------------------------------------------------
* Editor's note: the in-text citations contained in this statement
do not have a corresponding list of citations at the end of the
document, nor is there internal citation information within the
document. It has been reproduced herein as it was received.
Reforming heirs' property laws that can protect landowners
from involuntary land loss (Mitchell 2016). The USDA must
implement the planned changes in the 2018 Farm Bill to expand
and regularize the types of documentation that can be used by
heirs' property owners to qualify for USDA credit and
---------------------------------------------------------------------------
conservation program eligibility (DeCaille 2018).
Generating land-focused reinvestment, for true community
self-determined economic development.
The U.S. Government can support Black farmers, particularly those
practicing community-based, sustainable agriculture, in achieving
financial security and resilience, by:
Expanding financial supports, including within key USDA
programs that offer technical assistance (for example, the
Conservation Stewardship Program) and grants for capacity
building, such as the Farming Opportunities Training and
Outreach program, the Sustainable Agriculture Research and
Education program, and the Gus Schumacher Nutrition Incentive
Program. Barriers to participation should be identified and
eliminated, such as by recognizing traditional best management
practices and ecological knowledge in the evaluation of
applications and proposals.
Ending discriminatory lending practices and other mechanisms
of land seizure.
Promoting community-led and -centered programming to promote
and financially facilitate sustainable business ownership among
economically marginalized populations.
Improved access to loans, including low-interest and micro-
loans, as well as loans not requiring collateral. The USDA's
Farm Service Agency launched a micro-loan program in 2013 to
better meet the needs of underserved farmers (FSA 2019; Tulman,
et al., 2016), but the limit on annual funding available must
be raised (NSAC 2019).
Financial safety nets, such as insurance and relief
programs. Since the USDA does not currently publish rates of
and utilization of Federal crop insurance or disaster payments
across racial and ethnic groups, transparency is needed to help
guide improvements.
Fair, sustainable markets that support Black farmers and
reward social and ecological well-being. Direct marketing,
farm-to-institution arrangements, food hubs, and market
diversification can raise incomes and financial viability and
can be strengthened through grants, initiatives, and
institutional procurement commitments that are inclusive of and
accessible to these communities (Hand 2010; Key 2016; Cooper
2018). Developing markets for ethnic specialty crops and
culturally relevant fruits and vegetables can leverage skills
while also contributing to local economies (WF 2019).
The government can also advance the quality and equity of
infrastructure and information. Currently, Black farmers have less
access to, ownership of, and control over several key resources related
to infrastructure and information that are pivotal in establishing
successful, resilient, and sustainable farms. For example, fewer Black
farmers have access to internet service relative to white farmers (USDA
2019). Public research institutions have not served Black farmers
equitably and have, in some cases, been used as mechanisms for
exclusion (Lee and Keys 2013; Ammons, et al., 2018; Lee and Ahtone
2020).
USDA programs can help level the playing field through the
following:
Infrastructure investments--such as targeted grants and
incentives--are needed to fund BIPOC-led improvements on-farm
(such as washing, packing, storage and processing facilities)
and in communities (funding such things as internet access,
kitchen equipment in school cafeterias to enable local sourcing
from Black farmers).
Technical assistance and outreach that serves Black farmers,
including by recognizing traditional ecological knowledge and
management as best practices. Such programs should hire
culturally competent community representatives and service
providers (e.g., lenders, insurance agents, extension agents,
educators).
Research and education that includes and engages directly
with Black farmers and communities. For example, land-grant
institutions should be accountable to a revitalized public
mission supporting such work, including sharing resources with
community-based organizations. Additional resources should be
directed to the 1890 land-grant institutions (Historically
Black Colleges and Universities), to ensure they have the same
services and support as the land-grant institutions originally
chartered in 1862 (Lee and Keys 2013).
Perhaps most critically, the U.S. Government must ensure diverse
representation and leadership across agricultural decision-making,
including grant panels, advisory boards, and committees.
Removing discriminatory barriers to Black farmers and their
networks, and supporting their leadership in sustainable and community-
driven farming, will advance the equity and resilience of the nation's
food systems (HEAL Food Alliance 2018; Carlisle, et al., 2019).
The roadmap for how Black people, and other communities of
color, have been subjugated politically, culturally and
economically, is illustrated by the history of the U.S. Food
system. While racial equity has a new popularity in our
political system, the real work to address the severed
relationships Black and Brown farmers have experienced lies in
building and restoring our relationships to the land, to our
culture, to healthy and nutritious food, to the tools and
resources for economic autonomy, and to building political
power for the decision-making that impacts our communities. The
USDA and other areas of our Federal and local governments must
commit to removing corporate influence in our government and
then to reinvesting in a long-term relationship with farmers of
color to build democratic, healthy and sustainable regional
food systems.
Midwest Farmers of Color Collective Coordination Team.
In partnership with grassroots communities, the U.S. Government has
a critical role in creating opportunities for Black people in farming
that will pave the way toward long-term prosperity and sustainability.
Black farmers and ranchers have faced and continue to face
systemic discrimination in USDA programs, leading to lack of
access to credit and generational land loss. Moving forward, it
is essential that USDA policy--whether related to credit, land
access, or climate--prioritize investment in Black farmers in a
structured way. Land Stewardship Project, as an organization
with a primarily white membership base in rural Minnesota,
Wisconsin, and the Midwest, stands in solidarity with our Black
farmer and community members.
Jessica Kochick, Land Stewardship Project.
Thank you for the opportunity to submit written testimony.
Sincerely,
Navina Khanna,
Executive Director,
HEAL (Health, Environment, Agriculture, Labor) Food Alliance.
Statement 2
on behalf of tanya ward jordan, president, coalition for change, inc.
(c4c)
As President of the Coalition For Change, Inc. (C4C), I (Tanya Ward
Jordan) submit the present statement for inclusion in the hearing
record on the State of Black Farmers in the United States.
The C4C is a public interest volunteer and whistleblower group
formed to eradicate employment discrimination and retaliation in the
Federal sector. It also serves as an informational support network for
present and former Federal employees injured due to such unlawful acts.
U.S. Department of Agriculture's (USDA) employees have complained to
our organization about widespread discrimination. We find such reports
most troubling.
The C4C recognizes that the culture of internal workplace
discrimination harms employees. It also hampers USDA's ability to
provide fair and efficient services to the Black farmers. One key
measure we can take to improve the profitability and sustainability of
Black farmers is to bolster the Equal Employment Opportunity
Commission's (EEOC) oversight of USDA's complaint activity. Towards
this goal, C4C recommends that the House Agriculture Committee inquire
into the U.S. EEOC's hearing, appeal, and field audit activity linked
to USDA complaints.
It is key to note that the C4C had been meeting with Mr. Carlton
Hadden, EEOC's Director of the Office of Federal Operations, (OFO), to
recommend and spur reforms that would address the culture of racism,
sexism, and intimidation operating within the USDA that impacts Black
farmers, USDA employees and other Federal employees. To our dismay, the
EEOC's efforts to address C4C's recommended EEO reforms and Federal
employee concerns halted abruptly after the 2016 United States
presidential election.
Notwithstanding any inaction of the EEOC, I along with Paulette
Taylor, the C4C's Civil Rights Chair, presented Equal Employment
Opportunity (EEO) reforms to the late Representative Elijah Cummings.
He first introduced our crafted reforms in H.R. 1557 \1\ Federal
Employee Antidiscrimination Act of 2015 and later in H.R. 135.
Remarkably, on January 1, 2021, lawmakers adopted and included the EEO
reforms we presented to the late Congressman in the law aptly called
the Elijah Cummings Federal Employee Antidiscrimination Act of 2020.
[The reforms can be found under the William M. (Mac) Thornberry
National Defense Authorization Act for Fiscal Year 2021.]
---------------------------------------------------------------------------
\1\ See https://www.c-span.org/video/?c4545890/user-clip-coalition-
change-inc-instrumental-addressing-workplace-injustice.
---------------------------------------------------------------------------
Expressly, Black farmers and employees complain that when
discrimination is found, USDA rarely if ever disciplines law-breaking
employees. A key reform in the Elijah Cummings Federal Employee
Antidiscrimination Act calls for the EEOC to make disciplinary
referrals to the Office of Special Counsel when discrimination is
found. The C4C recommended this reform after learning, via Freedom of
Information Act request, the EEOC had failed (over several years) to
refer any cases to the OSC for possible disciplinary action.
In closing, the EEOC can play a key role in addressing the
discriminatory culture of USDA. An improved workplace culture will
benefit the Black farmers and others seeking equitable treatment in
need of USDA programs and services. For this reason, the C4C recommends
that the House Agriculture Committee take a critical look into the
EEOC's oversight of the USDA complaint program.\2\
---------------------------------------------------------------------------
\2\ The EEOC, which is to eradicate discrimination, consistently
fails to hold officials accountable for violating the Federal Equal
Employment Opportunity Program guidelines. For example, a review of
USDA data collected under the Notification and Federal Employee
Antidiscrimination and Retaliation (No FEAR) Act reflects that the USDA
is delinquent in posting No FEAR data and that for the ``2019'' period
shown on average the USDA exceeded the 180 day complaint processing
time for investigating complaints. As of April 2, 2021, USDA most
recent post of No FEAR cumulative complaint activity covers Fiscal Year
2019. See data at https://www.usda.gov/nofear.
---------------------------------------------------------------------------
Statement 3
on behalf of rural coalition/coalicion rural, et al.*
---------------------------------------------------------------------------
* Alabama State Association of Cooperatives; Concerned Citizens of
Tillery; Cottage House, Inc.; North Carolina Association of Black
Lawyers Land Loss Prevention Project; Oklahoma Black Historical
Research Project, Inc.; Operation Spring Plant, Inc.
For More Information Contact: John Zippert, RC Chairperson, Rural
Coalition, Eutaw, Alabama; Lorette Picciano, Executive Director, Rural
Coalition, 1029 Vermont Avenue NW Suite 601, Washington, D.C. 20005;
Website: www.ruralco.org; Savonala (Savi) Horne, ESQ, Executive
Director; Land Loss Prevention Project, 401 N. Mangum Street, 2nd
Floor, Durham, NC 27701, www.landloss.org.
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Introduction
Black farmers have been some of our nation's most vital stewards of
the land, productive and industrious farmers, and resilient and
determined producers. Remarkably, they have also used their farming and
business acumen to produce more generations of farmers and landowners,
schools, college graduates, separate business ventures, progressive
community organizations, and more. Many Black farmers and their
communities thrived until they made the decision to acquire loans or
other financing from the United States Department of Agriculture
(USDA). The USDA was supposedly designed to help farmers in times of
expansion, blight, and disasters. Yet, its racist lending and
supervisory policies caused countless Black farmers unwarranted stress
and heart ache, debilitating illnesses, financial ruin, constant
threats of government takeover, and premature deaths. Consequently,
Black farmers continue their more than century-old struggle for justice
and equality from the U.S. Government.
Matthew Grant (1918-2001) and Florenza Moore Grant (1921-2001) were
farmers in Tillery, Halifax County, North Carolina. In the 1940s, they
bought their family to the Tillery Resettlement Farms community under
the Federal Resettlement Administration that offered landless rural
people an opportunity for hard work and survival. The Tillery
Resettlement (Colored Section) was established as a segregated
community with African American families like the Grants receiving
smaller farms, smaller houses, and less farm equipment than their white
neighbors. African American farmers were offered an opportunity to
purchase land in the flood plain of the Roanoke River, while the White
area of the Resettlement was out of the river's reach.
Toiling under the material and mental pressures of segregation,
Matthew and Florenza raised a family and became leaders in their
community. In the early 1970s, under pressures of mechanization of
agriculture and competition from big agribusiness, they borrowed money
under a U.S. Department of Agriculture (USDA) program that was supposed
to help small farmers. They believed that unlike the local government,
with its historical role in maintaining racial oppression, the Federal
program would be fair and supportive of a rapidly disappearing pillar
in the nation--the African American family farmer.
By the late 1970s, the Grant family realized their hopes were
misplaced. African American farmers were given smaller loans at higher
rates than White farmers. In the spring, when White farmers were
receiving funds to buy seed and fertilizer, African American farmers
were still waiting for their loans. In the local Agriculture Department
office, the Grants and their neighbors were told to wait until all
White farmers had been seen first. They watched as checks were given
out to Whites, only to be told that their money had not yet arrived.
Loans to the Grants and other African American farmers were closely
supervised, requiring extra signatures and trips to the county seat
before farm supplies could be purchased. These hard working, proud
survivors of the rural south, farming land that their slave ancestors
worked for plantation owners, were treated with disrespect and racial
hatred.
Drought years and discriminatory practices prevented the Grants
from repaying the loan during the 1970s. In 1981 they signed a Consent
Judgment against their property in an agreement that the USDA would
release farm equipment and the Grants would withdraw a discrimination
lawsuit. This according to the USDA was a ``settlement of sorts'' that
would allow the Grants to continue farming and moving on with their
lives, but the USDA refused to work with them on a means of repayment
on the delinquent debt. Subsequently, Matthew and Florenza's children
tried to ``assume the debt,'' but their proposed monthly payment plan
was not accepted. Matthew was actually told by the FmHA district
director, ``It does not matter who you go to see, who you bring or what
you come up with, we are going to sale you out.'' Meanwhile, White
farmers who had been affected by crop losses were given flexibility to
settle their debts. Matthew and Florenza did not deny the debt, but
they protested that their financial situation had been worsened by
illegal racists practices.
In 1996, the USDA admitted that it had discriminated against the
Grant family. However, they prevented the Grants from collecting the
settlement that could have paid off their debt. Since that time the
Grant family has worked without success to achieve a reasonable
settlement with the government. Matthew and Florenza Moore Grant both
died in 2001, 6 months apart from one another.
The Grant family requests that the USDA clear the Matthew and
Florenza Moore Grant family debt, meet with our family to discuss an
adequate settlement for years of discrimination and turmoil, and assist
our family with starting an agricultural education fund for young
students interested in farming and being stewards of the land.
Cumulative Impact and Consequences of Discrimination
Experiences such as that of the Grant family are not uncommon, when
alternate financial arrangements are used to prevent permanent loss of
land, especially when the underlying factor is discriminatory treatment
by the government. The USDA has maintained that the Equal Credit
Opportunity Act does not cover the impact of pain and suffering. The
cumulative impact to the communities where these families farmed
included a loss of feeling of good faith in any sort of debt settlement
with the government. As a result, many farmers were unwilling to deal
with USDA.
The Secretary and the Congress are urged first to hear their
stories. As Section 1006 of the American Rescue Plan is implemented, we
also urge that the Secretary consider how BIPOC who've taken over
family operations family farm can be given a release from prior debts
as long as their debt arose out of some discriminatory actions. USDA
and the Congress should take such action to assure that the cloud over
the family is lifted so that the next generation farmers can
participate in USDA programs on their own as new and beginning farmers.
Their eligibility should not be barred because of a look back to debts
of their parents or anybody else within their family who had the
previous ownership of the farm.
The following excerpt from the introduction of the Statement by
John Zippert that the Federation of Southern Cooperatives/Land
Assistance Fund and the Rural Coalition to the U.S. House of
Representatives Committee on Agriculture Subcommittee on Conservation,
Credit, Energy, and Research on March 27, 2007 summarizes our past
recommendation Congress, including issues that remain relevant today:
``Collectively, the Federation, and the Rural Coalition and
its members and allies, have worked with thousands of farmers
on the intricacies of their dealings with USDA and to seek
structural change both administratively and in policy to assure
equity and accountability in programs and services.
``Over the past decade, we have supplied documents, analysis
and testimony to the Civil Rights Action Team, the National
Small Farms Commission, the U.S. Congress and the U.S. Civil
Rights Commission. A half dozen of us served on the National
Small Farms Commission, and we have also participated on other
committees and in many sessions with the Secretary and the
staff of the Department. We have led efforts to institute the
USDA Partners meeting held annually for the past 3 years to
allow USDA to develop relationships and understanding of the
work and experience of its Community Based Organization
Partners.
``Our collaborative legal and legislative work included the
1987 Agriculture Credit Act, the Minority Farmers Rights Act of
1990 that was accepted as section 2501 of the 1990 Farm Bill,
the 1994 Agriculture Reorganization Act, and collaborative
efforts towards passage of the 1999 Waiver of the Statute of
Limitations that removed a critical barrier to the settlement
of the longstanding class action lawsuits. Over the years, we
have also worked on disaster response, especially following
hurricanes Katrina, Rita and Wilma.
``We have also worked with this Committee on the most recent
2002 Farm Bill. We appreciate the support the Members of this
Committee who helped assure that structural changes instituted
to promote equity were included in that bill.
``The average age of farmers continues to rise, especially
among African American and other socially disadvantaged
producers. For many years, inadequacies and inequities in
programs and services have hastened the loss of African-
American and other people-of-color owned farms. Access to
credit is essential for all agricultural producers and those
who aspire to be agricultural producers. This Committee has the
ability to take the actions needed to assure that new
generations of people of color farmers and ranchers will have
access to land and production.
``In my years of work with the Federation of Southern
Cooperatives/Land Assistance Fund, I have never met a Black
farmer who was not discriminated against. I believe the same is
true for most of the diverse group of African-American, Latino,
American Indian, Asian American and female farmers I have
encountered within the Rural Coalition. As you well know, there
remain issues surrounding the settlement of the Pigford v.
Veneman and other still pending class action lawsuits against
USDA that need to be addressed. We will provide a supplemental
appendix for the record with updated statistics of the status
of this settlement and on late claims.
``For the past several months, our organizations have worked
with a group of colleagues who represent a wide and diverse
array of minority farmer and farmworker organizations called
the Farm and Food Policy Diversity Initiative. As you begin
your work on the 2007 Farm Bill, we share with you the
collective wisdom of our organizations and our partners on some
essential changes that Congress can and should make in order to
prevent the actions that necessitated legal action in the first
place and assure transparency and accountability in the
provision of services.
``We want to help bring about the day when African American
and other minority farmers can turn their attention to growing
crops and revitalizing rural communities instead of filing
complaints and lawsuits to secure the equitable service to
which they are entitled in the first place.
``Because of the cumulative effects of many years of
discrimination and neglect, we are also proposing remedial
measures and special services intended to reverse the impact of
years of discrimination and neglect on many minority farmers.
Our other recommendations include actions that can be taken to
improve services to the many farmers who have suffered
disasters in recent years, and some ideas on how to assure that
new farmer programs will also serve socially disadvantaged
producers.''
We have also attached for the use of this Committee an extensive
appendix of the research and policy recommendations Rural Coalition
with our members have developed and shared over several decades.
Central to this work especially as related to Black farmers were our
founding members including the Rural Advancement Fund of the National
Sharecroppers Fund (founded 1937) and the Federation of Southern
Cooperatives/Land Assistance Fund (founded 1967), and members who have
formed and joined since, including Concerned Citizens of Tillery,
Cottage House, Inc., North Carolina Association of Black Lawyers Land
Loss Prevention Project, Operation Spring Plant and Oklahoma Black
Historical, and our allies and partners including Intertribal
Agriculture Council and Arkansas Land and Farm Development Corporation
and the National Family Farm Coalition and Farm Aid.
The attached Congressional Testimonies include the many policy
recommendations we jointly made over the years to this Committee and to
the U.S. Senate since the first hearings in 2002. On the issue of
credit, we have also attached numerous policy briefs related to Farm
Credit, many authored by our Policy Advisor, Quinton Robinson, who in
2002 was the House Agriculture Committee staff member who organized the
first hearing in the Subcommittee on Departmental Operations. Of
particular relevance at present is the need for USDA Farm Services
Agency to issue regulations to fully implement the Equitable Relief
Provisions and the Heirs Property Relending Fund passed in the 2018
Farm Bill
Over these years, our team of collaborated have worked with the
House and Senate Agriculture Committees to develop and promote passage
of 40 sections passed in farm bills and related legislation since 1986.
In those years, we worked with Rep. Edolphus Towns, whose staff member
Brenda Pillars gave us access to a typewriter when the opportunity for
a new amendment arose, including the amendment for matching grants for
state mediation programs. The most extensive work began in the 1987
Agriculture Credit Act when discrimination by race and ethnicity was
first defined in the context of Federal Agriculture Policy.
It continued in section 2501 of the 1990 Farm Bill, which
authorized the first program to tangibly support the organizations who
serve Black and other farmers who had suffered discrimination, called
the Outreach and Assistance for Socially Disadvantaged Farmers and
Ranchers (OASDVFR). That statute for the first time that recognized the
importance of this network of community-based organizations, including
many who testified in this hearing, by making them eligible for grants
and contracts. We will underscore the importance of the direct one-on-
one technical assistance they have long been doing as a critical factor
in stopping foreclosures and helping Black farmers hold onto their
land.
We call particular attention to the aforementioned USDA Partners
Process. Beginning in 2005 and continuing into the Obama
Administration, this process convened a series of dialogues, or
conversations, on critical barriers faced by BIPOC farmers and the
community-based groups who served them with interagency teams of USDA
career staff. The process was led by Shirley Sherrod and other CBO
leaders. We estimate that as many as 500 people contributed over those
5 years. The comprehensive A Time to Change: A Report by the Assessment
Conversations Team,\1\ Sept. 22, 2010 remains useful today both to
measure progress and to identify additional changes. It was structured
to identify problems, propose solutions including statutory changes
needed, and also to describe what success would like. Many of the
recommendations informed our proposals to you for the 2008 Farm Bill,
and around 30 passed in the statute.
---------------------------------------------------------------------------
\1\ https://drive.google.com/file/d/
10rJEsuSOef1_3jOhA3HCDEkCIHJ_cDPr/view.
---------------------------------------------------------------------------
Since that time, many recommendations developed by the wide network
of community-based organization who work directly every day with this
nation's Black farmers and ranchers, and other Tribal, Latino, Asian
Pacific, and other small-scale producers have been passed into law,
with some implemented more fully than ever. We have also mobilized our
communities to help lawmakers understand the degree of support for this
proposals, including with sign on letters and collaboration with
Members of Congress especially in Congressional Black and Hispanic
Caucuses, annual Dear Colleague Letters. One of the early ones was led
by Rep. Sanford Bishop who for years led efforts to continually press
for more funding for the 2501 Program, from $1 million to its present
funding level. We will continue to work also with Secretary Vilsack and
his team to assure these funds more effectively reach and support the
eligible entities as defined by statute. We will be forwarding
additional recommendations to you on how the full suite of Outreach,
Beginning Farmer and Local Food programs can best complement each
other.
The drafting and action by this Committee in this year of 2021
represents a historic and significant step forward in a new effort to
begin to right some of the longstanding wrongs faced by Black farmers.
We have attached for your record a copy of our March 3 sign on letter
that we prepared to help support passage of the historic provisions he
included in the American Rescue Plan and a brief authored by our Policy
Advisor on the relevant authorities supporting these provisions. We are
deeply grateful to Chairman David Scott and the Members of this
Committee, several of whom we have worked with for decades, for this
action.
Relevant Data and Research
We are already working with USDA on the implementation of Sections
1005 and 1006 of the American Rescue Plan. As the Committee's work of
oversight continues and the preparation for the 2023 Farm Bill
commences, we share additional proposals we are refining with our
members and allies to support Black farmers in securing land tenure for
their families and generations into the future and restoring the
agriculture as an economic base of their communities.
Particularly as the debate over climate mitigation begins, we will
be highlighting the importance issue of land tenure. New investments of
Federal dollars over time have often favored larger scale farmers at
the expense of others. But as the recent pandemic has shown us, crises
such as these cause fundamental disruptions in existing food chains.
Resiliency now and in the future point toward the value of reorienting
the processing and distribution of food to shorter and more direct
local and regional farm to food networks that are closer and more
readily adaptable to serve the food needs of some of this nation's most
vulnerable communities.
We will specifically address the issue of heirs property later in
this piece. First, we thought it helpful to share a sampling of charts
we have developed in connection with a research project under an
Agriculture and Food Research Initiative project with the National
Institute of Food and Agriculture. This AFRI standard research project,
``Community Resilience Through Land Tenure Rights,'' will examine the
impacts of land tenure arrangements, non-ownership and related
encumbrances on the management of small to medium-sized farm operations
in a diverse cross section of socially disadvantaged agricultural
communities. Rural Coalition and its co-principal investigators include
both CBO's and researchers from Tuskegee University and Kansas State
University. North Carolina Association of Black Lawyers Land Loss
Prevention Project are co-Principal Investigators, with almost a dozen
other CBO partners.
We will also use similar profiles for in related research under a
Sustainable Agriculture and Research grant, Securing Land Tenure Rights
for Heirs Property Owners. The North Carolina Association of Black
Lawyers Land Loss Prevention Project is Principal Investigator. The
Rural Coalition and Tuskegee University and Virginia State University
are Co-Principal Investigators along with multiple CBOs and Farmers in
the Southern Region. The second grant focuses also on the quality and
availability of legal services.
These charts provide a snapshot of the trends in loss of land over
time as far back as 1959 for Orangeburg county. There also charts for
Barber Co[.], AL and Halifax county, NC. While there are specific
issues with data at various points in time, we have found that the
trends reflected are consistent with data we and others including the
1890 Universities have collected.
What the charts clearly provide is a sense of the cumulative impact
of the past and in some places ongoing failure to address and halt
discrimination. The result is the unjust and unnecessary loss of land
by African American producers whose place on the land predates the
arrival of many others in farming today.
State of Black Farmers in the U.S.--Historic Land Tenure by County
Change in Farm Numbers, Orangeburg County, South Carolina (1950-2017)
Black/African American Land Tenure in Barbour County, Alabama, 1964-
2017
Net Cash Farm Income by Race in Barbour County, Alabama, 2007-2017
Black/African American Land in farms (acres) in Dale County, Alabama,
1969-2017
Decrease in Black/African American Farms and Land in Halifax County,
North Carolina, 1978-2017
Chart Average Government Payments by Race Ethnicity in Halifax County,
North Carolina, 2007-2017
In almost every county we have already researched over several
decades, land ownership has become more concentrated. Many farmers and
ranchers have been unable to retain their land. The evidence of
disparate treatment is particularly notable with respect to Black
farmers and ranchers.
In collaboration with our farmer and rancher leaders, we organized
several participatory research projects designed to better understand
their views of USDA. The first was around issues related to
participation in Crop Insurance programs. The second followed a series
of farmer-led training we developed with our members. Our reports are
included in the appendix, but the following charts provide a snapshot
of how the needs of farmers overlap or diverge with the structure and
operation of USDA programs and services.
Table 1: Socio-Demographic Characteristics of Participants from Rural
Coalition Financial Training Project (2004/2005)
------------------------------------------------------------------------
Characteristic Percent
------------------------------------------------------------------------
Gender
Male 67.5
Female 32.5
(1,048)
Race/Ethnicity
American Indian 24.8
Asian American 3.5
Black/African American 54.9
White 5.0
Hispanic/Latino 10.7
Other 1.1
(1,052)
Highest Level of Education
Less than High School Degree 29.6
High School Degree 34.8
Some College, No Bachelor's Degree 29.6
Bachelor's Degree or Higher 6.0
(1,050)
Total Farm Income (after expenses) in 2003
Less than $4,999 54.0
$5,000-$9,999 23.5
$10,000-$19,999 13.9
$20,000-$29,999 4.3
$30,000 or More 4.3
(814)
------------------------------------------------------------------------
Table 2: Farm Characteristics of Participants from Rural Coalition
Financial Training Project (2004/2005)
------------------------------------------------------------------------
Characteristic Percent
------------------------------------------------------------------------
Own Land 84.5
(911/1,078)
Rent Land from Others 38.8
(409/1,053)
Own and Rent Land 28.1
(295/1,048)
Acres in agricultural production in 2003 *
Mean 85.2
Median 15.0
Minimum-Maximum 0-2,400
(937)
Acres in agricultural production in 2004 *
Mean 87.4
Median 15.0
Minimum-Maximum 0-2,600
(935)
Produced Commodity Crops in 2003 or 2004 54.5
(561/1,030)
Produced Fruits/Vegetables in 2003 or 2004 54.6
(553/1,013)
Raised Livestock in 2003 or 2004 47.1
(480/1,020)
Produced Commodity Crops, Fruits/Vegetables and 14.3
Livestock in 2003 or 2004 (137/960)
------------------------------------------------------------------------
* Ranchers often did not include grazing acreage in their estimates of
land in agricultural production.
Therefore, the numbers presented here are conservative estimates.
Table 3: Risk Management Strategies of Participants from Rural Coalition
Financial Training Project (2004/2005)
------------------------------------------------------------------------
Risk Management Strategy Percent
------------------------------------------------------------------------
Have Risk Management Plan 4.7
(45/961)
Use a Tax Accountant 42.7
(439/1,029)
Make Use of IRS Form Schedule F 18.6
(165/886)
Ever Purchased Crop Insurance
Yes, Currently Have Policy 9.6
Yes, But No Current Policy 5.8
No, Never 84.6
(971)
------------------------------------------------------------------------
Table 4: Labor Use of Participants from Rural Coalition Financial
Training Project (2004/2005)
------------------------------------------------------------------------
Risk Management Strategy Percent
------------------------------------------------------------------------
Spouse, Children or Other Family Members Receive Wages 17.7
from Farm (154/869)
Number of Full-Time Employees
None 85.4
1-10 14.0
11-20 0.3
21 or More 0.3
(988)
Number of Regular Part-Time Employees
None 80.6
1-10 17.9
11-20 0.9
21 or More 0.6
(987)
Employed any Seasonal or Migrant Employees in the Past 16.4
Year (127/773)
Any Seasonal or Migrant Employees Participate in H-2A 50.4
Program (64/127)
Understand Tax Rules for Farm Labor 14.5
(126/870)
------------------------------------------------------------------------
Table 5: Awareness of and Participation in Government Programs Among
Participants from Rural Coalition Financial Training Project (2004/2005)
------------------------------------------------------------------------
------------------------------------------------------------------------
Agency/Program Percent Aware
------------------------------------------------------------------------
Farm Services Agency Credit Programs 52.5
(533/1,015)
Farm Services Agency Disaster Payments 54.4
(522/959)
Natural Resources Conservation Service 48.7
(465/955)
Cooperative Extension Service 58.1
(567/976)
Rural Development 42.0
(400/953)
Risk Management Agency 35.7
(335/939)
------------------------------------------------------------------------
Program Program
Participation
------------------------------------------------------------------------
Ever Applied for a Loan from USDA 27.9
(234/839)
Ever Been Denied a Loan from USDA 91.3
(210/230)
Ever Received a Loan from USDA 32.0
(72/225)
Ever Received USDA Disaster Assistance 36.2
(354/977)
Participate in any Annual Commodity Program 13.5
(113/839)
Participate in any Conservation Program 8.1
(84/1040)
------------------------------------------------------------------------
The farmer/mentors requested that we ask not only questions about
the number of farmers who prepared schedule F of their tax return. Only
18.6% said yes. They also wanted to know how many used tax preparers.
40% responded they did. Many of the groups who participated in this
research continue to this day provide direct technical assistance to
producers on the importance of good financial records, and the need
also to provide required reports to document production and report
losses.
These findings also underscore the importance of sustaining
community-based organizations who are trusted by farmers for assistance
in understanding and navigating USDA programs.
Also instructive is one chart from an earlier study which included
a slightly different population of producers. We will have more to
share as this Committee begins work on the next farm bill and on
climate issues. We looked at the level of participants in all types of
insurance and these are our findings from the year 2002.
Table 4. Insurance Use from Small, Limited Resource and Minority Farmers
Survey
------------------------------------------------------------------------
Variable Frequency Percent
------------------------------------------------------------------------
Currently use any form of insurance
Editor's note: there is no
corresponding table note for the entry
with the asterisk. The table has been
published herein as received from Rural
Coalition/Coalicion Rural.
Respondents answering yes 116 137
84.7 100.0
Types of insurance used
Health insurance * 97 83.6
116 100.0
Dental insurance 43 37.1
116 100.0
Accident insurance 39 33.6
116 100.0
Life insurance 74 63.8
116 100.0
Disability insurance 29 25.0
116 100.0
Auto insurance 100 86.2
116 100.0
General homeowner or renter insurance 84 72.4
116 100.0
Disaster insurance 25 21.6
116 100.0
General liability insurance for farm 43 37.1
operation 116 100.0
Crop insurance 29 25.0
116 100.0
------------------------------------------------------------------------
We underscore the importance of the Farm Opportunities Outreach and
Training Programs, including the Outreach and Assistance Program for
Socially Disadvantaged Farmers and Ranchers. Our community-based
organization members routinely accompany farmers the farmers we serve
to USDA offices to make sure they are prepared to request services they
need and to navigate USDA systems.
Our research findings highlight the need for improved connections
and restoration of trust with USDA. Our organizations led efforts to
establish systems that would allow USDA to monitor how these systems
are working. One particular recommendation as far back as the 2002 Farm
Bill is to require the farmer be provided a Receipt for Service on each
visit to the agency. This was adopted in 2008 as a require to provide a
Receipt upon request. Rep. (and now HUD Secretary) Marcia Fudge offered
an amendment during the 2014 Farm Bill Mark-up which is now a statutory
requirement whose validity is affirmed including in an Administrative
Law Judge opinion on a farm appeal. We remind the Committee that the
required receipt for service is not uniformly provided in all offices
and farmers are still facing push back for asking or outright refusal
of their request.
Just last evening, our Rural Coalition Board Member Barbara Shipman
of Cottage House, Inc. in Ariton, Alabama shared this story. ``I had
one of my farmers to go into a particular NRCS office and FSA office to
request assistance. The young lady threw and not only hit him in the
face with his folder, but she also told him `get out of the office and
don't come back until you have 3 years' worth of farm records.' Let me
tell you please--returning military members have PTSD it didn't take
the snap of a finger to get them in the military zone again so that's
why I go with them. I ended up having to talk to State Director. He
said he was going to get involved. He called back to say he did so and
said I should have no problem with anybody else like that.''
Mrs. Shipman, herself an Army veteran of the Gulf War, routinely
welcomes recently returned service members from Fort Rucker to consider
farming. This particularly newly returned Veteran had grown up on a
farm and had a plan for producing pecans and goats.
She also recounted that she recently accompanied two farmers to
visit four separate county offices to determine who was supposed to
serve them. One was not open for a prescheduled appointment; another
was closed. In the last office, the staff member agreed to get on the
computer to ascertain the correct service center. She said it was
closing time, but she could provide service there at another time.
Barbara told her, ``that's fine as long as he leaves here with two
things--a letter of receipt for service that provides his farm and
tract number and a copy of the technology map of where his land is
located. Then in future all you have to do give the address and you can
pull it down on the computer and print it all. When we walked out of
the office, I told him that when you get ready to go back to the office
you let me know. We will go together because that's what I do. I will
walk him through how to get those things he wants, and I know he's in
that computer system. He can't march over to the NRCS, no way, if he's
not in the computer system in FSA, step number one.'' She works with
40-60 farmers every year to assure service is done right. Without her,
``they'll just turn him away and they won't even tell them about the
receipt for service and they will not tell him he's due a copy of that
topology map of his land or get him a farm and tract number--because
that farmer number goes on that letter receipt for something so when he
goes in the next time he has to do his put his farm in tracking down in
the system and it brings up his file right and then he should have
access.''
Technical Service Providers and Community Based Organizations--Mrs.
Shipman has many other examples to share. Community based organizations
need to have a sustained funding, perhaps in new ways, to assure the
many CBO staff members who provide such services can be compensated,
retained and prepare to train others to perform these services. They
could form the foundation of a network of CBO based technical service
provides with authority to work on technical assistance for both FSA
and NRCS programs.
She and many of our other members, including Mr. Willard Tillman of
the Oklahoma Black Historical Research Project, have the stressed the
need for ongoing support in order to do the work necessary to help
farmers and ranchers connect with USDA. They are also able to build
relationships with service centers and assure farmers are able to do
what they need to do. These CBO technical service provides are also
provide the invaluable service of calling inadequate service to the
attention of USDA leaders at the state and national level, so immediate
intervention can be made, with appropriate accountability. It is
critical to set in place new policy to provide this kind of trusted
technical support to help farmers, ranchers, forest land owners and
their families secure land and rebuild local economies.
Technical Support Providers are now used extensively in
conservation programs. Authority should be provided to allow these
providers who work with CBO's to cover FSA programs also. This would
help CBO's to build a sustainable network of next generation leaders
trained by our skilled leaders who have supplied technical assistance
to our farmer members for over 4 decades. We believe that such
investments would improve family wealth, stabilize land values and
secure a tax base with improvements to the education, public works and
the economic situation of the whole community.
Critical and Continuing Issues--County Committees
Our early collaborative work began in 1997, when we convened a
group to address the issue of Farm Service Agency County Committees.
After a week of training and dialogue at USDA headquarters coordinated
in cooperation with NRCS Chief Pearlie Reed and FSA Credit Director Lou
Ann Kling, we examined voting patterns, and eligibility and access
issues. Our members looked at county data of eligible voters and how
many voted in county committee elections, and ballot counting
procedures. We encouraged turnout with some results in subsequent
years.
We have also examined over the past few decades the data systems of
USDA and how transparency and accountability could be advanced with
modification of these systems. In 2002, we prepared testimony for the
Senate Committee on Agriculture where we were invited to testify by
Senator Richard Lugar. This statement, which we have not located, was
very similar to the one shared of the House hearing at the same time.
Senator Lugar, with Senator Blanche Lambert Lincoln and others,
included language we recommended to assure transparency and
accountability in USDA practices, including the collection and
publication of data on the participate rates of producers in USDA
programs by race, gender and ethnicity. These provisions were added and
were updated in subsequent farm bills. More work is necessary to assure
these are available to farmers and groups working with them at the
county level. They are also essential to help the Secretary and his
team to in a proactive way identify offices that are doing a good job,
and offices where improvements or other action are needed.
For many years we urged USDA and the Congress to move from a
complaint generated system of solving exclusions proactively instead of
only after farmers had have to enter the long and risky process of
appeals, civil rights complaints and litigation. We urge the Secretary
to also engage the office of the Assistant Secretary for Civil Rights
to have the ability to transform systems of analysis necessary to
offset problems before the pose a barrier to more farmers.
We share the following story from our Rural Coalition newsletter of
December 2000 which recounts the proceedings of the first Senate
Agriculture Committee Hearing on Civil Rights in September that year.
County Committees--Below is a snapshot--the last we have--of data
on the number of votes cast in the county election of 2009. This
election was in only one Local Administrative area.
Data on the over composition of county committees is also included
in some attached statements.
--------------------------------------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Ballots Cast By Race, Ethnicity, and Gender in 2009 \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Gender Ethnicity American Asian Black or Native Unknown White Total
Indian or African Hawaiian or Ballots
Alaskan American Other Cast by
Native Pacific Gender and
Islander Ethnicity
--------------------------------------------------------------------------------------------------------------------------------------------------------
Female Hispanic or Latino 73 2 34 9 145 960 1,223
Not Hispanic or Latino 172 108 408 226 3,316 4,230
Unknown 123 78 319 147 1,095 1,782 3,544
------------------------------------------------------------------------------------------
Female Total 368 188 761 382 1,240 6,058 8,997
------------------------------------------------------------------------------------------
Male Hispanic or Latino 100 52 27 10 366 1,332 1,887
Not Hispanic or Latino 392 106 823 125 44,837 46,283
Unknown 397 175 992 113 774 40,435 42,868
------------------------------------------------------------------------------------------
Male Total 871 333 1,842 248 1,140 86,604 91,038
------------------------------------------------------------------------------------------
Organization Hispanic or Latino 14 3 9 1 314 494 835
Not Hispanic or Latino 142 95 448 28 277 78,620 79,610
Unknown 116 45 607 41 1,217 66,204 68,230
------------------------------------------------------------------------------------------
Organization Total 272 143 1,064 70 1,808 145,318 148,675
------------------------------------------------------------------------------------------
Unknown Hispanic or Latino 0 0 3 8 92 103
Not Hispanic or Latino 3 20 43 11 416 1,325 1,818
Unknown 6 6 6 7 1,772 454 2,251
------------------------------------------------------------------------------------------
Unknown Total 9 26 52 18 2,196 1,871 4,172
==========================================================================================
Total Ballots Cast by 1,520 690 3,719 718 6,384 239,851 252,882
Race \2\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ballot Summary
--------------------------------------------------------------------------------------------------------------------------------------------------------
LAA Total Eligible Ballots 2,021,637
LAA Total Ballots Cast 252,494
Percentage of Eligible Voters that Cast Ballots 12%
National Total of Ballots Disqualified 13,156
Percentage of Ballots Disqualified vs. Ballots Received 5%
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Represents only those LAAs in which an election was held in 2009.
\2\ Due to producers' ability to select more than one race, the Total Ballots Cast in 2009 may be greater than LAA Total Ballots Cast in Ballot Summary
Table.
When requirements were added in the 2002 and 2008 Farm Bills to
authorize the assignment of minority advisors to county committees and
to update election provisions, the Congress also changed the law to tie
eligibility to participate on county committees to those who
participated in farm programs. This should be extended to include
farmers who are eligible to participate and registered with USDA, even
if they choose not to participate.
However, issues with county committees also continue. In the past 2
weeks, we were contacted by an Oklahoma farmer who is employed in
another state. He has informed the County Committee a few years ago
that the farm had been transferred to his name. He was seeking help
because he currently has a neighbor who has been planting wheat on land
that belongs to him and filing claims for payments. He has provided
documentation to show that the FSA county office reached wrote to the
farmer demanding he send the certified lease so the neighboring farmer
could collect his payment. The farmer owner wrote a cease and desist
letter to his neighbor and asked the office to address the issue of the
illegal claims. He also noted that the lease given to the office by the
neighbor was fraudulent. While he was seeking response from the county,
he reported that the staff asked him not to report this as it would
``get a former employee in trouble.'' A county committee member also
asked him if he wants to sell his land.
We believe these issues merit a full review of the role and
practices of the use of county committees and their continuing failure
to include and serve the needs of all farmers but especially Black
Farmers. In the next farm bill, we believe it is time that this
Committee review ways to replace county committees with a more
professional and accountable system.
FSA Farm Credit--Immediate Actions Needed
We have worked extensively on the issues of Farm Credit over many
years and hope we can provide additional recommendations as the
Committee addresses those particular issues.
At present, the two most essential credit related issues are to
assure that Farm Service Agency issue regulations and implement the
following:
(1) Ensure Equitable Relief Provisions to protect the farmer in the
case of errors or intentional actions in loan agreements by
Farm Service Agency staff members, and
(2) Implement the Heirs Property Relending Program.
With respect to the Relending program, Congress since the 2018 Farm
Bill has appropriated $20 million for FSA to relend to entities
qualified to lend as community development financial institution, and
who have significant demonstrated experience serving the needs of
socially disadvantaged farmers and ranchers.
There are such institutions available to begin working with
families to resolve heirs property encumbrances which keep them out of
full participation in USDA programs. These funds are urgently needed.
The pandemic has caused the loss of over \1/2\ million members of our
society. Some of them are farmers. Their families urgently need
assistance in handling the difficult issues of settling estates. Making
these program available will enable the groups who know how to do this
work to immediately assist Black and other people of color landowners
to secure land tenure in a way the addresses the rights of all interest
holders, and to emerge with a succession plan to guide that family in
the future.
Direct and Guaranteed Loans and Borrowers Rights
Section 1005 of the American Rescue Plan provides funds to Black
farmers and other people of color borrowers to pay off loans from both
FSA and Farm Credit Administration. We will have attached a brief we
provided to the General Accounting Office in advance of the study they
did on the availability of credit to Socially Disadvantaged Farmers and
Ranchers. The report suggests several issues for the attention of the
Administration and the Congress. We will prepare future input on these
provisions.
It is also important to understand the issues farmers are
encountering due to lack of data collection and clear procedures to
assure that all borrowers rights, including the Equal Credit
Opportunity are assured. We have recommended to the Secretary that
clear procedures for Farm Credit Borrowers to identify themselves as
socially disadvantaged and eligible for the Emergency Relief provided
must be set in place.
We further refer you to correspondence between Rural Coalition and
both the FSA and the Farm Credit Administration referring to the case
of a young farmer. We have redacted the farmer's name. These letters
show how FCA says go to the lender, the lender says to go to FCA, and
FSA asserts they have no authority on guaranteed loans. These
illustrate the point that there is no clarity for the borrower and no
real explanation if anyone has authority to act if farmers feel they
were discriminated against on a guaranteed loan.
We urge Congress to address these gaps. We further endorse the
recommendations provided in the hearing by the Federation of Southern
Cooperatives that a separate entity within or similar to other farm
credit institutions be established to attend to the unmet needs of this
sector of farmers and ranchers.
Heirs Property, Insecure Land Tenure, Climate and Rural Communities
The Federation of Southern Cooperatives/Land Assistance Fund has
been identifying the importance of addressing heirs property issues for
decades, beginning with a 1980 Report by the Emergency Land Fund.
In 2017, the Oklahoma Black Historical Research Project convened
the 100 Farmers Summit In Oklahoma City in March 2017 for in input in
advance of the 2018 Summit.\1\ The 100 Summit Report: Addressing the
Needs and Concerns of the Underserved Minority Family Farming Community
is included in the attachments. The following issues raised by the 100
Black farmers on heirs property include:
---------------------------------------------------------------------------
\1\ Oklahoma Black Historical Research Project, with Rural
Coalition, et al.,\1\ The 100 Summit Report: Addressing the Needs and
Concerns of the Underserved Minority Family Farming Community, 2017.
(A) Specific Issues Related to Heir Property--The following were the
key issues that needed to be addressed to restore access to
programs for producers lacking clear title or lease on the
---------------------------------------------------------------------------
land they farm or seek to farm:
Heir Property: If you have land but there is no will or
document saying who will be the administrator of it, your
ability to administer and use it is very difficult. If
there is not an administrator for the land, you will not be
able to get a loan through the USDA. For example, when you
want to take out a loan, but you are the beneficiary of
land along with your siblings--you have to get all other
siblings to sign on to your loan. You will end up in a case
with the bank and your siblings to settle your claim
interest in the land. Speculators will seek out one or two
siblings to see if they can buy them out, then they can
petition the courts for the full property to be sold.
Called a ``speculating interest'' in the land to cause land
loss. You get a minimal amount of the value of that land.
Arkansas' law has changed--the Uniform Partition of Heirs
Property Act allows an heir who is a co-owner to buy out
another who wants to sell their share of a property at the
market value of the property.\2\
---------------------------------------------------------------------------
\2\ In addition to Arkansas; Alabama, Connecticut, Georgia,
Montana, Nevada, New Mexico and Texas numerous states have now adopted
or have introduced versions of the Uniform Partition of Heirs Property
Act (http://www.uniformlaws.org/shared/docs/partition%20of%20heirs%20
property/uphpa_final_10.pdf). Passage of the Fair Access to Farmers and
Ranchers provisions in the 2018 Farm have helped build support to enact
the law drafted by the nonprofit Uniform Law Commission (http://
www.uniformlawcommission.com/) to make it easier to divide property and
preserve family wealth as the owners multiply over generations.
---------------------------------------------------------------------------
Adverse Possession is also used by white farmers, investors and
property owners to take land. They pay property taxes and
take ownership, even where there are not heir property
issues. For example, an African American woman rented her
land to a white farmer and as part of the rent he paid her
taxes for 5 years. One year he did not pay rent and told he
did not owe it because now he owned the land Strategies:
Get more protections in place for African-American
families. A lot of risk factors that can result in land
loss--need to address them comprehensively.
Key point: There is a systemic lack of access to information
and resources to resolve heir property issues--We see a
great deal of land that is idle, land that could be
productive but isn't. The legal risk varies from state to
state. In some states, someone can seize rights to a
property simply by paying delinquent taxes. The time in
which one is considered to have relinquished their rights
to their land varies by state. There was a provision in the
2014 Farm Bill to help get Black farmers' land back; but it
didn't go anywhere. We need new support for education on
wills and estate planning.
Heirs Property and the Ecological Costs of Discrimination
Oklahoma Black Historical Research Project worked over the past
decade to engage Black farmers in NRCS programs. With Rural Coalition
and the Scholars of the America University Farm Bill practicum, the
researched the data and experiences of Black farmers in access USDA
programs. Their findings are summarized and published in the research
paper on the Ecological Costs of Discrimination.* \3\
---------------------------------------------------------------------------
* (https://www.researchgate.net/publication/
336701771_Ecological_costs_of_discrimination
_racism_red_cedar_and_resilience_in_farm_bill_conservation_policy_in_Okl
ahoma)
\3\ Fagundes, Tillman, et al., Ecological costs of discrimination:
racism, red cedar and resilience in farm bill conservation policy in
Oklahoma, October 2019, Renewable Agriculture and Food Systems (https:/
/www.researchgate.net/journal/Renewable-Agriculture-and-Food-Systems-
1742-1713) 35(4): 1-15, DOI: 10.1017/S1742170519000322 (https://
www.researchgate.net/deref/
http%3A%2F%2Fdx.doi.org%2F10.1017%2FS1742170519000322).
---------------------------------------------------------------------------
Invasive species thrive in places facing climatic changes and put
farmers at further risk. In Oklahoma, eastern redcedar is spreading at
the rate of 800 acres a day. Without help for mitigation from USDA
especially for historically underserved farmers who farm on heirs
property, small cow and calf operations have seen their grazing land
taken over by redcedar, which competes with pastureland by consuming up
to 55,000 gallons of water per acre per year and puts the viability of
their operations at further risk. Other risks they have faced over the
past decade include severe cycles of floods, droughts, fires, freezes
and tornados. Farmers who were deemed ineligible for NRCS program, the
OBHRPI learned, were denied because they lacked the documentation to
secure farm and tract numbers to demonstrate their control of the land
on which they sought benefits.
The Fair Access for Farmers and Ranchers Act, drafted by Rep.
Fudge, and introduced in the Senate by Senators Doug Jones and Senator
Tim Scott, authorized the aforementioned the heirs property relending
fund. It also authorized the use of alternate methods of documentation
to allow access for farmers to NRCS and other programs to allow them to
care for land. For the first time in Federal law, it made some of the
methods consistent with the processes outlined in the Uniform Partition
of Heirs Property state passed law. The third provision, Section 12607
of the 2018 Farm Bill authorized Farmland Ownership Data Collection
that sought to identify the land tenure trends that may affect
generational transitions, and barriers to entry for beginning and
socially disadvantaged farmers and ranchers.
The data and studies compiled under Section 12607 are critical
inform and guide all levels of agricultural policy making that concern
the critical dynamics of heirs' property and absentee land ownership in
farming communities. Appropriations of $3 million annually were
authorized. We urge this Committee to assure this important initiative
is full funded. This baseline study is essential to allow the Congress
to anticipate the impact of various kinds of climate interventions on
farm and forest land tenure especially for Black Farmers.
Heirs Property and Forest Land
Securing and building land tenure is also critical to protecting
the intergenerational transfer of land and wealth and building a
community with a healthy ecosystem and a tax base to sufficient to
support quality education, employment opportunities, and a strong
infrastructure. The following abstract of the paper ``Taking
Goldschmidt to the Woods: Timberland Ownership and Quality of Life in
Alabama'' \4\ summarizes the impact of the degree of highly
concentrated land ownership on children, families and the communities:
---------------------------------------------------------------------------
\4\ September 2020 Rural Sociology (https://www.researchgate.net/
journal/Rural-Sociology-0036-0112) 86(1) DOI: 10.1111/ruso.12344
(https://www.researchgate.net/deref/
http%3A%2F%2Fdx.doi.org%2F10.1111%2Fruso.12344) Authors: Conner Bailey
(https://www.researchgate.net/scientific-contributions/Conner-Bailey-
36320674), Abhimanyu Gopaul (https://www.researchgate.net/scientific-
contributions/Abhimanyu-Gopaul-2179969094), Ryan Thomson (https://
www.researchgate.net/profile/Ryan-Thomson), Auburn University (https://
www.researchgate.net/institution/Auburn-University); Andrew Gunnoe
(https://www.researchgate.net/profile/Andrew-Gunnoe), Maryville College
(https://www.researchgate.net/institution/Maryville_College).
Abstract: We use a database of property tax records for 13.6
million acres representing every parcel of privately owned
timberland in 48 rural Alabama counties to test two hypotheses
inspired by Walter Goldschmidt relating land ownership and
quality of life. Our data show private ownership is highly
concentrated and 62 percent is absentee owned. We employed
Pearson correlations alongside Poisson and negative binomial
regression models to estimate influence of both concentrated
private ownership and absentee ownership of timberland. Our
findings support Goldschmidt-inspired hypotheses that
concentrated and absentee ownership of timberland exhibit a
significant adverse relationship with quality of life as
measured by educational attainment, poverty, unemployment, food
insecurity, eligibility for free or reduced-price lunch at
public schools, Supplemental Nutritional Assistance Program
participation, and population density. Low property taxes in
Alabama limit the ability of local governments to generate
revenue to support public education or meet other
infrastructural or service needs in rural areas. We call on
rural sociologists and kindred spirits to pay more attention to
the fundamental importance of land ownership which shapes the
foundations of power and inequality affecting rural life in
America and beyond.\5\
---------------------------------------------------------------------------
\5\ ttps://www.researchgate.net/publication/
344021201_Taking_Goldschmidt_to_the_Woods
_Timberland_Ownership_and_Quality_of_Life_in_Alabama.
We look forward to other opportunities sharing our proposals to
more fully full address the set of issues we have raised, including
with respect to climate. We further point to a critical need to assure
farmers have access to the qualified and trusted legal and technical
assistance necessary to protect their land.
In October 2019, the North Carolina Association of Black Lawyers
Land Loss Prevention Project authored a Continuing Legal Education
(CLE) manuscript ``Assisting Heir Property Owners Facing Natural
Disasters: History and Overview of Heir Property Issues.'' We
participated in person as a panelist in the collaborative CLE webinar
to train NC Legal Aid volunteer attorneys on service to impacted heir
property owners. The webinar took place on October 23. According to
Legal Aid's coordinator, there were approximately 124 webinar
participants on that date and the course will continue to be available
for training purposes.
Through individual direct legal intervention, technical assistance,
outreach and policy innovation and implementation, the overall outlook
for North Carolina's disaster-affected families has been substantially
improved. The benefits include increased property retention, removal of
barriers to assistance programs, enhanced food access, heightened farm
business risk management, and family engagement in multi-generational
planning as a safeguard against inherent co-ownership vulnerabilities.
We project that the pandemic will continue to emphasize the need
for education on what defines sustainability and how environmental,
economic, health stressors are intertwined and cumulative. This
highlights the importance of collaborative work we have all done to
expand the framework of justice and increase the tools and resources
available to communities to take direct action to promote community
health. We see our engagement with Black and Brown-led coalitions and
initiatives advancing sustainable environments and community-controlled
food only deepening and expanding.
We will provide a letter to Chairman Scott and the Committee in
upcoming weeks that better summarizes our immediate recommendations for
action.
Conclusion
Today, Black farmers find themselves still seeking financial
compensation from years of discrimination by the United States
Department of Agriculture (USDA). This financial compensation, along
with the American Rescue Plan, has been called ``unfair reparations,''
``another handout,'' or some other dehumanizing term by prominent and
influential elected officials and others. This continued systemic and
institutionalized racism is further evidence of the unrelenting
discrimination that Black farmers and their communities experience on a
daily basis. Furthermore, many Black farmers, their families and
communities continue to be on the brink of bankruptcy, foreclosure, and
homelessness. The USDA must act now to implement the American Rescue
Plan and related initiatives to empower Black farmers and their
communities. The American Rescue Plan and related initiatives can only
be successful if the USDA pays off Black farmers' USDA farm loan debts,
creates an inclusive and equitable implementation process for the $1B
authorized by Section 1006, and prioritizes policies that help Black
farmers and their communities to hold onto their land and protect it
from further discriminatory practices.
Introduction to the Appendix
We have affixed this appendix to provide this Committee with a
record of some of the research, documentation, analysis and solutions
the Black, Indigenous and other People of Color farmers and ranchers we
serve have recommended over the years. These reflected repeated calls
to our elected leaders to hold our U.S. Department of Agriculture
accountable for these continuing abuses.
And we have provided this Committee with many policy
recommendations, some of which have been adopted, some adopted but not
yet implemented, and others ready to be adapted for the current day. We
are not the only such groups have done so. We feel it is important for
this Committee to have a record of the work of this important work at a
time when the will to make these changes is greater than we have seen
before.
Summary of Appendices
1. Congressional Letters and Testimony
Rural Coalition, et al., Letter to the Leadership of the U.S. House
of Representatives and the U.S. Senate to Support Emergency Relief for
Farmers and Ranchers of Color, March 3, 2021.
Quinton R. Robinson, Esq., Policy Brief on the Need for Emergency
Relief for Farmers of Color, Rural Coalition, March 4, 2021.
Statement of John Zippert on behalf of the Federation of Southern
Cooperatives and Rural Coalition, to the Subcommittee on Departmental
Operations, Committee on Agriculture, U.S. House of Representatives,
Washington, D.C., September 25, 2002.
Statement of John Zippert on behalf of the Federation of Southern
Cooperatives and Rural Coalition to the Subcommittee on Conservation,
Energy, Research and Credit, Committee on Agriculture, U.S. House of
Representatives, Washington, D.C., March 27, 2007.
2. Research Findings and Policy Recommendations
A Time to Change: A Report by the Assessment Conversations Team
(https://drive.google.com/file/d/10rJEsuSOef1_3jOhA3HCDEkCIHJ_cDPr/
view), Sept. 22, 2010 (link only to a comprehensive 150-page report of
a multi-year assessment of USDA Prog[r]ams andservices with CBO leaders
and USDA Agency Staff).*
---------------------------------------------------------------------------
* Editor's note: the report entitled, A Time to Change: A Report by
the Assessment Conversations Team, was not included as a part of the
Rural Coalition/Coalicion Rural for the March 25, 2021 hearing
submission's appendices. It is retained in Committee file.
---------------------------------------------------------------------------
John J. Green, PhD, ``Summary Results from The Financial Training
Project Assessment Survey: A Report to the Rural Coalition,'' Institute
for Community-Based Research, Division of Social Sciences/Center for
Community and Economic Development, Delta State University, February
2006.
John J. Green, Lorette Picciano, Heather Fenney, et al., ``The
Insurance Needs of Traditionally-Underserved Farmers: Framework for a
Multi-Community Assessment,'' presented at the Annual Meeting of the
Rural Sociological Society, Montreal, Canada, July 2003.
Oklahoma Black Historical Research Project, with Rural Coalition,
et al.,\1\ ``The 100 Summit Report: Addressing the Needs and Concerns
of the Underserved Minority Family Farming Community,'' 2017.
3. Issues Related to Farm Credit and Guaranteed Loans
Rural Coalition Letter to the [Government Accountability] Office
(GAO) regarding Sec. 5416. GAO Report on Credit Service to Socially
Disadvantaged Farmers and Ranchers, Washington, D.C., March 3, 2021.**
---------------------------------------------------------------------------
** Editor's note: the letter is dated March 3, 2019. It has been
published herein as received.
---------------------------------------------------------------------------
Farm Credit Administration response to a farmer following a request
for assistance with a complaint, December 18, 2014.
Rural Coalition Letter to the Farm Credit Administration requesting
information on assuring protections under the Equal Credit Opportunity
Act, December 19, 2014; farmer name redacted.
Letter from FSA Administrator Val Dolcini in response to our letter
related to same farmer case, January 13, 2015, which includes the quote
``FSA will be carefully reviewing the action taken by Farm Credit in
this case and, if irregularities are identified, any loss claims will
be adjusted accordingly. Aside from evaluating Farm Credit's adherence
to published regulations for the administration of a guaranteed loan,
FSA has no authority to oversee nor provide direction to the Farm
Credit System. If Mr. (redacted) believes Farm Credit has acted
improperly, he should contact the Office of Congressional and Public
Affairs, Farm Credit Administration, in McLean, Virginia, which is the
oversight organization for the Farm Credit banks.'' ***
---------------------------------------------------------------------------
*** Editor's note: the letter was not included as part of the
appendices of the Rural Coalition/Coalicion Rural for the March 25,
2021 hearing submission.
---------------------------------------------------------------------------
Congressional Letters and Testimony
[1] Rural Coalition, et al., Letter to the Leadership of the U.S.
House of Representatives and the U.S. Senate to Support Emergency
Relief for Farmers and Ranchers of Color, March 3, 2021.
[2] Quinton R. Robinson, Esq., Policy Brief on the Need for
Emergency Relief for Farmers of Color, Rural Coalition, March 4, 2021.
[3] Statement of John Zippert on behalf of the Federation of
Southern Cooperatives and Rural Coalition to the Subcommittee on
Conservation, Energy, Research and Credit, Committee on Agriculture,
U.S. House of Representatives, Washington, DC, March 27, 2007.
[4] Statement of John Zippert on behalf of the Federation of
Southern Cooperatives and Rural Coalition, to the Subcommittee on
Departmental Operations, Committee on Agriculture, U.S. House of
Representatives, Washington, D.C., September 25, 2002.****
---------------------------------------------------------------------------
**** Editor's note: the order of the listing Congressional Letters
and Testimony has been changed to reflect the order of the actual Rural
Coalition/Coalicion Rural appendices for the March 25, 2021 hearing
submission.
---------------------------------------------------------------------------
[Congressional Letters and Testimony 1]
March 3, 2021
Hon. Charles Schumer, Hon. Mitch McConnell,
Majority Leader, Minority Leader,
U.S. Senate, U.S. Senate,
Washington, D.C.; Washington, D.C.;
Hon. Nancy Pelosi, Hon. Kevin McCarthy,
Speaker, Minority Leader,
U.S. House of Representatives, U.S. House of Representatives,
Washington, D.C.; Washington, D.C.
Support Emergency Relief for Farmers and Ranchers of Color
Dear Leaders Schumer and McConnell, Speaker Pelosi, and Leader
McCarthy:
We, the 181 undersigned organizations are committed to improving
the financial and rural development interests of this nation's Black,
Indigenous, Hispanic and People of Color farmers and ranchers. We
endorse and urge you to support the Emergency Relief for Farmers of
Color Act introduced by Senator Reverend Raphael Warnock (D-GA),
Senator Cory Booker (D-NJ), Senator Ben Ray Lujan (D-NM), and Senate
Agriculture Chairwoman Debbie Stabenow (D-MI). We further urge you to
assure the emergency relief provisions drawn from this Act as included
by House Agriculture Committee Chairman, Rep. David Scott (D-GA) to the
Concurrent Resolution on the Budget for Fiscal Year 2021, are included
in the final COVID Emergency Budget Reconciliation Package.
Our expressions of support for these family farmer provisions are
rooted in fairness and equity. American agriculture has a long history
of providing various forms of family farm debt and other emergency
relief. Yet the troubled history of farm loan discrimination for Black,
Indigenous, Hispanic, and farmers of color, coupled with their
exclusion from the many farm programs other producers depend upon to
survive and thrive, weakens these farm families, making it impossible
to transfer farmland wealth from generation to generation.
For example, the $14.4 billion in trade adjustment assistance
provided in 2019 through the Market Facilitation Program i
did not address the needs of the small farm specialty crop and
livestock sectors of the market where their production is concentrated.
The emergency COVID relief provided through the Coronavirus Food
Assistance Program, the Farmers to Family Food Box Program, and the
Small Business loan programs have provided only minimal assistance to
farmers of color. Several BIPOC-led farmers groups who did participate
successfully in early rounds of the Farmers to Families Food Box
Program were not included in subsequent rounds.
---------------------------------------------------------------------------
\i\ GAO Report--The U.S. Department of Agriculture's (USDA) Farm
Service Agency (FSA) distributed about $14.4 billion in 2019 Market
Facilitation Program (MFP) payments to farming operations in all 50
states and Puerto Rico . . . to 643,965 farming operations. MFP
payments for 2019 also varied by type of commodity. Three types of
commodities were eligible for 2019 MFP payments: (1) nonspecialty crops
(including grains and oilseeds, such as corn and soybeans); (2)
specialty crops (including nuts and fruits, such as pecans and
cranberries); and (3) dairy and hogs. Less than ten percent went to
farming operations that produced specialty crops or dairy and hogs.
---------------------------------------------------------------------------
At the same time, these producers have worked diligently throughout
the pandemic to increase production in uncertain markets and to do all
they can with little to no government support to meet the urgent food
needs of their communities.
Over 200 years of beneficial treatment positions the sectors of
farmers, who have benefited most from historic and recent investments
in Federal farm programs, with more assets under their control, more
land base to leverage, and more market stability to capitalize on and
mitigate the impacts of economic crises the likes of which we are
currently experiencing. Farmers of color were already leveraged to the
hilt prior to the crisis because their operations haven't had the same
multigenerational investments. The carefully crafted support from
Emergency Relief for Farmers of Color Act provisions provides the
urgently needed debt forgiveness and technical assistance necessary to
shore up this sector of producers who do not enjoy extensive Federal
support and an asset base to leverage. The legislation provides:
$4 billion in direct relief payments to help farmers of
color pay off outstanding USDA farm loan debts and related
taxes, and help them respond to the economic impacts of the
pandemic, and
Another $1 billion fund to root out systemic racism by
expanding the capacity of USDA to provide technical and legal
assistance to agricultural communities of color and to fund
under-resourced programs that will shape the future for farmers
and communities of color, including:
Grants and loans to improve land access and address
heirs' property issues;
Support for one or more legal centers focused on
agricultural legal issues of farmers of color (including
succession issues made more urgent when many families have
lost members to a pandemic that has claimed over half a
million lives);
Pilot projects focusing on land acquisition, financial
planning, technical assistance, and credit;
A racial equity commission and related activities to
address systemic racism across USDA;
Support for research, education, and extension at
Historically Black Colleges and Universities (HBCUs), 1994
Tribal Colleges, and Hispanic-Serving and other
institutions of higher education that historically serve
communities of color;
Scholarships at 1890's land-grant universities and for
indigenous students attending land-grant institutions;
Support for outreach, mediation, financial training,
capacity building training, cooperative development
training and support, and other technical assistance in
cooperation with the community-based organizations and
institutions of higher education with the experience to
provide it;
Assistance to farmers, ranchers, or forest landowners
of color that are former farm loan borrowers and that
suffered related adverse actions, or past discrimination or
bias.
Black, Indigenous, Hispanic and Farmers of Color continue to play
an important social and economic role in sustaining rural communities
while protecting the natural resources and producing safe and
affordable farm products. We, the undersigned, urge the U.S. Congress
to ensure the urgently needed emergency relief for BIPOC farmers
remains in the final COVID Emergency package.
Original Signatories Boulder County Farmers Markets,
Boulder, CO
Brandworkers, New York City, NY
Rural Coalition, Washington, D.C. California Association of Food
(For more information contact Banks, Oakland, CA
[email protected]) Carolina Farm Stewardship
Association, Pittsboro, NC
North Carolina Association of Black CEO Pipe Organs, Delafield, WI
Lawyers Land Loss Prevention Chicago Food Policy Action Council,
Project, Durham, NC Chicago, IL
Alabama State Association of Golden Ponds Farm, Franklin, AR
Cooperatives, Epes, AL
National Latino Farmers and Church Women United in New York
Ranchers Trade Association, State, Rochester NY
Washington, D.C.
Environmental Working Group, City Love, Philadelphia, PA
Washington, D.C.
Coastal Enterprises, Inc.,
Brunswick, ME
National Signatories Colorado Farm and Food Alliance,
Paonia, CO
Community Alliance with Family
Farmers, Davis, California
Agricultural Missions, Inc., New Concerned Citizens of Tillery,
York, NY Tillery, NC
Agroecology Research-Action Cottage House, Inc., Ariton, AL
Collective, Oakland, CA
Alianza Nacional de Campesinas, Cultivate Charlottesville,
Oxnard, CA Charlottesville, Virginia
American Farmland Trust, Cumberland County Food Security
Washington, DC Council, Portland, Maine
American Sustainable Business Dakota Rural Action, Brookings, SD
Council, Washington, DC
Campaign for Family Farms and the Darden's Farm/Health Services,
Environment, Washington, DC Littleton, NC
Center for Biological Diversity, Democracy Green, Morganton, NC
St. Petersburg, FL
Center for Community Self-Help, Earth Action, Inc., Pensacola, FL
Durham, NC
Center for Science in the Public Ecological Farming Association,
Interest, Washington, DC Soquel CA
Clean Water Action, Washington, DC EcoVillage Farm Learning Center,
Richmond, CA
Community Food and Justice Ekar Farm, Denver, CO
Coalition, Oakland, California
Cooperative Food Empowerment Equity Advocates, Harrison, NY
Directive, Santa Rosa, CA
Domestic Fair Trade Association, Fair Farms, Takoma Park, MD
Olympia, WA
Earthjustice, New York, NY Farmworker Association of Florida,
Apopka, FL
Eastern Hemp Foundation, Feral Heart Farm, Sunol, CA
Philadelphia, PA
Experimental Farm Network, Food & Nutrition Innovation
Philadelphia, PA Institute at Tufts University,
Boston, MA
Fair Food Network, Ann Arbor, MI Food in Neighborhoods Community
Coalition, Louisville, KY
Family Farm Action, Mexico, MO Friends of Family Farmers,
Walterville, Oregon
Family Farm Defenders, Madison, WI Georgia Organics, Atlanta, Georgia
Farm Aid, Cambridge, MA GoFarm, Golden, CO
Farmers Market Coalition, Albany, Greater KC Food Policy Coalition,
CA Kansas City, MO
Farms to Grow, Inc., Oakland, CA Green State Solutions, Iowa City
Federation of Southern Cooperatives/ Healthy Gulf, New Orleans, LA
Land Assistance Fund, Atlanta, GA
Feed the Truth, Washington DC Heartwood, Tell City, IN
Feeding America, Chicago, IL High Desert Food and Farm Alliance,
Bend, OR
Food & Water Watch, Washington, DC Hempstead Project Heart, WI
Food Animal Concerns Trust, Hmong American Farmers Association,
Chicago, IL St. Paul, MN
Food Chain Workers Alliance, Los Hub City Farmers Market,
Angeles, CA Spartanburg, South Carolina
Food First, Oakland, CA Idaho Organization of Resource
Councils, Boise, ID
Food Law and Policy Clinic, Harvard Illinois Stewardship Alliance,
Law School, Boston, MA Springfield, IL
FoodCorps, Washington, DC Interpret Green, Philadelphia, PA
Friends of the Earth, Washington, Iowa Citizens for Community
DC Improvement, Des Moines, IA
GMO/Toxin Free USA, Unionville, CT Johnson's Farm, Wichita, KS
GreenLatinos, Washington, D.C. Kamaria Creations Wellness Retreat,
Albuquerque, NM
Hazon, Falls Village, CT Kamayan Farm, Carnation, WA
Health Care Without Harm, Reston, Kansas Black Farmers, Nicodemus, KS
Virginia
HEAL (Health, Environment, Kansas Rural Center, Wichita,
Agriculture, Labor) Food Alliance, Kansas
Oakland, CA
Heifer USA, Little Rock, AR KC Farm School, Kansas City, MO
Hunger Free America Inc., New York, Knoxville Knox County Food Policy
NY Council, Knoxville, TN
Institute for Agriculture and Trade La Semilla Food Center, Anthony, NM
Policy, Minneapolis MN
Johns Hopkins Center for a Livable Land For Good, Keene, NH
Future, Baltimore, MD
King Arthur Baking, White River Land Stewardship Action Fund,
Junction, VT Minneapolis, MN
LEAD for Pollinators, Inc., Akron, Land Stewardship Project,
OH Minneapolis, MN
National Black Food and Justice Latino Farmers of the Southeast,
Alliance, Atlanta, GA Crescent City, FL
National Family Farm Coalition, Lyon County Food and Farm Council,
Washington, D.C. Emporia, KS
National Farm to School Network, Maine Organic Farmers and Gardeners
Washington, D.C. Association, Unity, Maine
National Organic Coalition, Mandela Partners, Oakland, CA
Arlington, MA
National Sustainable Agriculture Minnow, Oakland, CA
Coalition, Washington, D.C.
National Wildlife Federation, Missouri Rural Crisis Center,
Washington, D.C. Columbia, MO
National Young Farmers Coalition, Montana Organic Association,
Washington, D.C. Missoula, MT
Natural Resources Defense Council, New Entry Sustainable Farming
New York, NY Project, Beverly, MA
Northwest Atlantic Marine Alliance, New Mexico Hemp Company, LLC,
Gloucester, MA Albuquerque, NM
Organic Advocacy, Felton, CA Northeast Organic Farming
Association of New York, Syracuse,
NY
Organic Farmers Association, Spirit Northeast Organic Farming
Lake, IA Association of Vermont, Richmond,
VT
Organic Seed Alliance, Port Northeast Organic Farming
Townsend, WA Association-Interstate Council,
Stillwater, NY
OrganicEye, Washington, D.C. Northeast Sustainable Agriculture
Working Group, Kingston, NY
ROCUNITED, New York, NY Nourish Colorado, Denver, CO
Pesticide Action Network, Berkeley, Now You Know New Mexico,
CA Albuquerque, NM
Public Justice, Washington, D.C. Oklahoma Association of
Conservation Districts, Oklahoma
City, OK
Rural Advancement Foundation Oklahoma Black Historical Research
International-USA, Pittsboro, NC Project, Inc., Oklahoma City, OK
Rural America Chamber of Commerce, Oregon Food Bank, Portland, OR
Callicoon, NY
Rural Development Leadership Pasa Sustainable Agriculture,
Network, New York, NY Harrisburg, PA
Slow Food USA, Brooklyn, NY Pennsylvania Council of Churches,
Harrisburg, PA
The Common Market, Philadelphia, PA Pinnacle Prevention, Chandler,
Arizona
The Food Trust, Philadelphia, PA Prairie Rivers Network, Champaign,
IL
The Marcus Foundation, Washington, Providence Farm Collective,
D.C. Buffalo, NY
Union of Concerned Scientists, Radical Family Farms, Sebastopol,
Washington, D.C. CA
Women Food and Agriculture Network, Rogue Permaculture, Yelm, WA
Story City, IA
Roots of Change, Oakland, CA
Regional, State and Local Rural Advancement Fund of the
Signatories National Sharecroppers Fund, Inc.,
Orangeburg, SC
21st Century Youth Leadership San Luis Valley Local Foods
Movement, Eutaw AL Coalition, Alamosa, CO
Abanitu Organics, Roxboro, NC Sanarte Healing Culture Clinic, San
Antonio, TX
Advance Carolina, Raleigh, NC Slow Food Urban San Diego, San
Diego, CA
Advancing Collective Equity, Soil Generation, Philadelphia, PA
Portland, OR
African Alliance of Rhode Island, Solar Wind Works, Wellington, NV
RI
Agri-Cultura Cooperative Network, Soul Fire Farm, Petersburg, NY
Albuquerque, NM
Alabama Rivers Alliance, Sustainable Food Center, Austin, TX
Birmingham, AL
Alliance for the Great Lakes, Texas Mexico Border Coalition
Chicago, IL Community Based Organization, San
Isidro, TX
Alliance for the Shenandoah Valley, The Center for Environmental
New Market, VA Transformation, Camden, NJ
American Federation of Government The Marion Institute, Southcoast
Employees, Local 3354, Saint Food Policy Council, Marion, MA
Louis, MO
Asian Pacific Islander Forward WATCH, Inc., Charlevoix, MI, USA
Movement, Los Angeles, California
Atrisco NM, Atrisco, NM Western Organization of Resource
Councils, Billings, MT
Atrisco Valley Farm LLC, Winston County Self Help
Albuquerque, NM Cooperative, Jackson, MS
Black Family Land Trust, Inc., World Farmers Inc., Lancaster, MA
Durham, NC
Black Farmers and Agriculturalists
Association, Tillery, NC
Black Farmers and Ranchers New
Mexico, Jareles, NM
[Congressional Letters and Testimony 2]
For More Information contact: Rural Coalition Executive
Director Lorette Picciano at [email protected] or 703-624-
8869.
Policy Brief on the Need for Emergency Relief for Farmers of Color
By Quinton R. Robinson, Esq., Policy Advisor, Rural Coalition
March 4, 2021
The Rural Coalition has submitted this Letter to Support Emergency
Relief for People of Color Farmers and Ranchers signed by 181
organizations in support of the socially disadvantaged \1\ farmer and
rancher debt relief language and technical assistance provided for in
the Emergency Relief for Farmers of Color sections of S. Con. Res. 5,
Concurrent Resolution on the Budget for Fiscal Year 2021. Our
expressions of support in that letter for these family farmer
provisions are rooted in fairness and equity. American agriculture has
a long history of providing various forms of family farm debt relief,
and that history should not be denied to socially disadvantaged farmers
and ranchers based on unfounded constitutional reasoning. We are
pleased that the Budget Committee in the House of Representatives
continues to work with the U.S. Senate to ensure the debt relief for
socially disadvantaged farmers and ranchers in the package passed by
the full House.
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\1\ In this brief, the ``socially disadvantaged'' is as defined in
7 U.S.C. 2279a.
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In this brief, we provide additional analysis of the legal
underpinnings and need for this relief.
I. Introduction
After the settlement of Keepseagle, Garcia, and Pigford, socially
disadvantaged producers have experienced farm loan discrimination
within business transactions. The discriminatory loan transactions
include inaccurate loan terms or conditions, fraud and corrupt
organizational lending schemes that are sometimes developed and
advanced by Federal farm loan officers. (See Wencslause Provost v.
First Guaranty Bank, and `It's not fair, not right': how America treats
its Black farmers D World news D The Guardian).
Nevertheless, some Members of Congress have challenged the
constitutionality of legislative provisions designed to provide farm
loan debt relief to socially disadvantaged farmers and ranchers. Weak
constitutional challenges omit critical facts that highlight Congress's
oversight and investigative authority over farm loan programs. The
Congress has a continuing duty to improve opportunities for success in
agriculture through future legislative actions. Where discrimination in
farm loan programs is prevalent, Congress must exercise its charge to
correct inefficiencies in farm loan programs while providing
remediation and restorative justice to socially disadvantaged farmers
and ranchers. The farm loan debt relief in this stimulus bill is a good
start and documented examples support the narrative that commands
Congressional action.
For example, in North Carolina, the U.S.D.A. Farm Service Agency
issues a farm family an illegal loan based on the error and
misstatements by Agency officials. Later, the Agency issues a
foreclosure notice that would not be issued but for the Agency's error.
In Louisiana, a family is coerced, as a condition of receiving a new
farmer ownership loan, to refinance a parent's older farm equipment. As
a component of the loan transaction, the guaranteed lender and FSA
officials require the young, new and beginning, farmer to deliver the
financed equipment to the processing mill. In Pueblo, CO, a farmer is
given inaccurate farm loan servicing information which leads to
foreclosure notices. In Arkansas, a farmer is given a guaranteed loan
and immediately receives a request from the bank's loan officer to loan
the bank officer $20,000.00 from the guaranteed loan proceeds as a
condition of receiving the guaranteed loan. In Georgia, young farmers
are prevented from purchasing a parent's farm from a foreclosure
proceeding. These are the examples for which there is widespread
awareness. Constitutional arguments against minority farm loan debt
relief cannot withstand the illegalities of these substantiated
examples of discrimination. Other examples will never be discovered.
Hidden discrimination within farm loan programs is a disgrace to the
implementation of the program, amounting to government approval of
illegal foreclosures and farm land theft. S. Con. Res. 5, Concurrent
Resolution on the Budget for Fiscal Year 2021 provides a solution to
these hidden numbers.
The Farm Credit Act's original intent was not adequately designed
to address discrimination in loan transactions. However, no provision
of the Act prevents the Secretary of Agriculture from connecting other
laws and regulations to the base requirements of the Farm Credit Act
and the Secretary of Agriculture should use the Farm Credit Act to
build the foundation for minority farmer debt relief.
For more than 33 years, the debt relief provisions of the 1987 Farm
Credit Act served as sound authority to grant emergency farm loan debt
relief for our nation's farmers and ranchers. Laws and regulations that
provide debt relief to farmers have not been challenged in the Federal
courts nor within the administrative function of the U.S. Department of
Agriculture. Likewise, over the past 33 years, the U.S. Congress has
not found reasons to discontinue family farm debt relief based on legal
questions challenging the constitutionality of debt relief under key
provisions of the 1987 Farm Credit Act.
Farm loan debt relief has been granted, under appropriate
circumstances, as a family farm preservation method of rescheduling
debt in order to keep farmers on the land during harsh economic
conditions. Thus, any attack on debt relief for socially disadvantaged
farmers and ranchers during the current COVID-19 pandemic must be
characterized as a mean-spirited attempt to further exclude socially
disadvantaged producers from equitable participation in USDA's programs
and services.
The U.S. Department of Agriculture's legal and regulatory framework
used for farmer emergency financial assistance is firmly established
and consistently applied to large row crop farmers and ranchers. Farm
emergency loans and program payments work well for large row crop
farmers. However, the same regulatory framework escapes the emergency
farm loan needs of socially disadvantaged producers during the COVID-19
pandemic. The political support for the large farmer emergency
financial assistance framework spurred the COVID-19 emergency Federal
financial assistance, which totaled over $14.4 billion within the
narrow time period of just 16 months. Using structured laws and
regulatory authorities such as the Commodity Credit Corporation,
Congress and the Administration protected the farm income and
production assets owned by large row crop farmers and private
investors. The payments are said to support family farmers during the
COVID-19 economic emergency. The problem is that minority family
farmers are consistently excluded from meaningful participation in
emergency financial assistance.
Minority family farmers are a critical component of America's
family farm system. The family farm system is a cherished system,
receiving congressional support for more than 120 years. In fact,
current law demands that the Secretary of Agriculture conduct the
emergency loan programs under 7 U.S.C. 1961 in a manner that fosters
and encourages the family farm system of agriculture, consistent with
the reaffirmation of policy and declaration of the intent of Congress
contained in section 102(a) of the Food and Agriculture Act of 1977. (7
U.S.C. 1166(a).) The Budget Reconciliation language again reaffirms the
Congressional intent that socially disadvantaged farmers and ranchers
are not to be excluded from COVID-19 emergency spending and debt relief
is the best way of supporting socially disadvantaged farmers and
ranchers.
II. Essence of the Minority Farmer Debt Relief
The preamble of the minority farmer debt relief language recognizes
the historical, long-term negative impacts of discriminatory lending
which impacts minority family farms more than any other classification
of farm operations. socially disadvantaged farmers and ranchers play an
important social and economic role in sustaining rural communities
while protecting the natural resources and producing safe and
affordable farm products. The troubled history of farm loan
discrimination, when added to farm program participation
discrimination, weakens minority farm families, making it impossible to
transfer farmland wealth and the farming vocation from generation to
generation.
The undersigned organizations recognize that all family farmers
need assistance from the government during the COVID-19 pandemic. Our
awareness of a broad need for emergency farm assistance must be open
minded and embrace the familiar concept of family farm debt relief for
socially disadvantaged farmers and ranchers as a manner of sustaining
rural communities and rural economies. This is not a large ask.
The minority farmer farm debt relief accomplishes this goal in
section 1005 to 1006 of S. Con. Res. 5, Concurrent Resolution on the
Budget for Fiscal Year 2021, Budget Reconciliation proposal. The
proposal authorizes the Secretary of Agriculture to use existing
statutory authorities to develop and implement a plan of debt relief
for socially disadvantaged farmers and ranchers. We are committed to
working with the Secretary of Agriculture to ensure that a plan of farm
loan debt relief is comprehensive, effective, and inclusive.
III. Selective Debt Relief is Constitutional, Firmly Established and
Consistently Applied
Debt relief for America's family farmers has a long history. The
benefits of such farmer debt relief are well documented and farm debt
relief should not be prevented as a benefit inside farm gates of
socially disadvantaged farmers and ranchers. Debt relief for socially
disadvantaged producers adds an additional level of legitimacy for farm
loan programs, especially where there is documented discrimination in
farm loan servicing. There are five prominent statutory provisions that
support the constitutionality of minority farmer debt relief.
Therefore, any constitutional attack on these provisions will be
diffused.
A. 7 CFR 766.401(b) Agency Exception Authority
When measured against the documented history of disparate treatment
and disparate impact in farm loan programs, debt relief for socially
disadvantaged producers adds an additional level of program legitimacy,
especially where there is documented discrimination in farm loan
servicing. Under current law, the Secretary of Agriculture has the
authority to improve the financial and operational efficiency of all of
USDA's farm loan programs. Minority farmer debt relief is an
administrative tool to accomplish that goal while providing restorative
justice for minority farm loan borrowers. Pursuant to 7 CFR 766.401(b),
the Secretary of Agriculture may, to advance the financial interests of
the farm loan program, relieve the debt of farmers under circumstances
where by the debt relief promotes a financial interest of the Agency.
We believe that restorative justice in the form of farm loan debt
relief is a circumstance that promotes the financial interest of the
Agency. We are not alone in our restorative justice convictions.
Congressman David Scott, Chairman of the House Committee on
Agriculture ensured that Section 1005 of Budget Reconciliation proposal
contained language to enumerate past discrimination against minority
farm loan borrowers. 7 CFR 766.401(b) states in relevant part: ``(b)
the Agency's financial interest would be adversely affected by acting
in accordance with published regulations or policies and granting the
exception would resolve or eliminate the adverse effect upon its
financial interest.'' (7 CFR 766.401(b).)
B. Farm Loan Equitable Relief
A provision of farm loan equitable relief may be combined with base
provision within the Farm Credit Act for the purpose of developing a
plan of minority debt relief.
Reported family farm foreclosures, under strange circumstances of
government errors and mistakes, secured the attention of the U.S. House
and Senate Agriculture Committees in 2018, leading to the passage of 7
U.S.C. 2008a. The new law is referred to by farmers and stakeholders
as ``equitable relief'' in farm loan programs. Notably, farm loan
errors and mistakes prior to December 20, 2018 were definitionally
excluded from agricultural regulatory schemes designed to grant
equitable relief.
We have gathered evidence to show that loan mistakes made against
socially disadvantaged producers are not mistakes, but intentional acts
designed to cause foreclosure of farmland. Generally, a grant of
equitable relief to a farmer is permitted, with limitations, in order
to allow a producer to keep program benefits when the possession of the
benefit is deemed noncompliance with statutes and regulations and such
noncompliance is caused by the misaction or misinformation provided to
the program participant by an authorized government official. See 7
U.S.C. 2008a.; 7 U.S.C. 7996 (d); 7 U.S.C. 6998 (d), and 7 U.S.C.
1339 (causation based on misaction or misinformation). It is
important to note that 7 U.S.C. 2008a. uses a different causation
standard than 7 U.S.C. 7996 (d); 7 U.S.C. 6998 (d), and 7 U.S.C.
1339.
Pursuant to subsection (c) of the 7 U.S.C. 2008a., the farmer must
identify the government's farm loan error and provide notice of the
error or mistake directly to the Secretary in a format that is
acceptable to existing statute, regulation, or agency guidance. USDA's
farm loan programs offer at least four different approaches of
providing notice of the harmful, unlawful error. The farm loan error,
for which equitable relief may be appropriate, may be noticed to the
Secretary of Agriculture in coordination with four USDA's various
institutional appeal or grievance processes. Subject to filing deadline
restrictions, institutional coordination of requests for equitable
relief are found in and included in a farmer's substantive explanations
and statements offered by a farmer in support of the following appeal
related processes:
(i) U.S.D.A. civil rights program and loan complaint pursuant to (7
CFR 15.1-15.12) (180 days from date of last act of
discrimination);
(ii) U.S.D.A. National Appeals Division (NAD) for appeal of an
adverse farm program decision pursuant to 7 U.S.C. 6991 and
7 CFR 11.1 (30 days from adverse program decision);
(iii) Loan servicing options such as debt write down, or deed in
lieu of foreclosure pursuant to (7 CFR 766.101-766.116-
766.150) (30 days from adverse action); and
(iv) Submission of official correspondence to the Secretary
explaining the farm loan error or mistake and its attendant
correlations to default, acceleration and foreclosure
pursuant to 7 U.S.C. 2008a.
Except for farm loan equitable relief under 7 U.S.C. 2008a.,
equitable relief made available in civil rights complaints, NAD program
appeals, and farm loan servicing, represents a forum for such relief in
a program. That farm loan grievance program is firmly established and
consistently implemented by the Secretary. Equitable relief language is
self-executing, statutory language. It provides an additional component
of the historical regulatory scheme for providing general equitable
relief to farmers within USDA's programs and services. Farm loan, civil
rights, NAD appeals, and form loan servicing, when analyzed
collectively, represent a continuum of legal norms and standards
whereby the Secretary of Agriculture may grant a provision of equitable
relief.
The Secretary has authority to forgive farm loan debt pursuant to 7
CFR 766.401(b).
IV. Disparate Treatment in Emergency Farm Assistance
The cumulative effect of farm loan discrimination and exclusion
from other programs has left socially disadvantaged farmers and
ranchers with small landholdings comprised of more fragile and less
productive land. Consequently, socially disadvantaged producers have
less access to the commodity, conservation, disaster, and risk
management programs. Mid-size and large-scale operations fair better
under the same programs and benefits. Congress spoke clearly and
provided generous emergency relief to large and mid-size producers to
address market disruptions in 2019 and the pandemic and fluctuations in
world markets in 2020. During this same time period, Congress was
silent with respect to emergency funding provisions to help socially
disadvantaged farmers and ranchers to secure the income necessary to
run their operations and pay their loans.
For example, the emergency relief provided by Congress through the
Coronavirus Food Assistance Program largely failed to provide relief to
people of color farmers and ranchers who now seek loan forgiveness.
White farmers received 97% of the $9.2 billion allocated through
October 2020.\2\
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\2\ https://www.ewg.org/news-and-analysis/2021/02/usda-data-nearly-
all-pandemic-bailout-funds-went-white-farmers.
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In 2019, little emergency relief was provided to the farmers
seeking it. USDA paid $14.4 billion in 2019 Market Facilitation Program
(MFP) payments to farming operations in all 50 states and Puerto Rico.
According to [Government Accountability] Office (GAO),\3\ these
payments were intended to offset the effects of trade disruptions and
tariffs targeting a variety of U.S. agricultural products. FSA
distributed these payments to 643,965 farming operations. The average
MFP payment per farming operation for 2019 was $22,312 but varied by
county, ranging from $44 to $295,299. MFP payments for 2019 also varied
by type of commodity. Three types of commodities were eligible for 2019
MFP payments: (1) nonspecialty crops (including grains and oilseeds,
such as corn and soybeans); (2) specialty crops (including nuts and
fruits, such as pecans and cranberries); and (3) dairy and hogs.
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\3\ GAO Report--The U.S. Department of Agriculture's (USDA) Farm
Service Agency (FSA) distributed about $14.4 billion in 2019 Market
Facilitation Program (MFP) payments to farming operations in all 50
states and Puerto Rico) . . . Less than ten percent went to farming
operations that produced specialty crops or dairy and hogs.
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Most of the 2019 MFP payments went to farming operations that
produced nonspecialty crops. Less than ten percent went to farming
operations that produced specialty crops or dairy and hogs. USDA made
approximately $519 million in additional MFP payments in 2019 compared
with 2018 because of increases in payment limits--the cap on payments
that members of farming operations can receive. FSA distributed these
additional MFP payments to about 10,000 farming operations across 39
states. The amount of additional MFP payments that FSA distributed for
2019 varied by location. Farming operations in five states--Texas,
Illinois, Iowa, Missouri, and Minnesota--received almost half of all
additional payments.
These payments followed the approximately $8.6 billion USDA
announced it had distributed for 2018. USDA referred to these 2018 and
2019 payments as the MFP. In comparison with 2018, USDA changed the
2019 payment structure for the three types of commodities that were
eligible for payments, including increasing the payment limit for each
of these three types, with more aid going to larger operations.
The debt relief and other technical assistance provided for in the
Emergency Relief for Farmers of Color sections of S. Con. Res. 5,
Concurrent Resolution on the Budget for Fiscal Year 2021, referred to
as the COVID Emergency Budget Reconciliation Package, are urgently
needed to afford this important sector of agriculture the critical type
of emergency relief they require to address their debt and maintain
their land and operations for the future. We urge that Congress approve
the full measure of proposed relief.
[Congressional Letters and Testimony 3]
Statement of John Zippert on Behalf of the Federation of Southern
Cooperatives/Land Assistance Fund and the Rural Coalition/
Coalicion Rural to the U.S. House of Representatives, Committee
on Agriculture, Subcommittee on Conservation, Credit, Energy,
and Research *
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* Editor's note: the statement submitted as part of the appendices
of the Rural Coalition/Coalicion Rural for the March 25, 2021 hearing
is incomplete (it does not include pp. 1-4). The link for the testimony
submitted for the hearing, in its entirety, is: https://
www.govinfo.gov/content/pkg/CHRG-110hhrg36367/pdf/CHRG-
110hhrg36367.pdf, pp. 185-203. Further note: the published hearing,
110-8 does not include Appendix B of this testimony (Information
Required From Non-governmental Witnesses).
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Washington, D.C.
March 27, 2007
Excerpt: [beginning on p. 5 of the testimony].
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Program Participation Report
Program National Summary
Fiscal Year: 2003
Farm Service Agency
Beginning Farmer Down Payment Loan Program
----------------------------------------------------------------------------------------------------------------
Male
Female
Unknown
----------------------------------------------------------------------------------------------------------------
Hispanic or Not Hispanic Hispanic or Not Hispanic or Not Undiscloded
Latino or Latino Latino Hispanic or Latino Hispanic or Ethnicity
Latino Latino
----------------------------------------------------------------------------------------------------------------
Participatio Participatio Participati Participati Participati Participati Participati
n Indicator n Indicator on on on on on
Indicator Indicator Indicator Indicator Indicator
----------------------------------------------------------------------------------------------------------------
White <3% 99.5% <3% 3.9% 0% <3%
Black 0% <3% 0% 0% 0% 0%
AI/AN <3% <3% 0% 0% 0% 0%
Asian 0% <3% 0% <3% 0% 0%
HPI 0% 0% 0% 0% 0% 0%
Other <3% <3% <3% 0% 0% 0%
Multi 0% <3% 0% 0% 0% 0%
Unclass 0%
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Total............ <3% 94.2% <3% 4.0% 0% <3% 0%
----------------------------------------------------------------------------------------------------------------
We believe that the Congress should further investigate why this is
so, and what factors in the design and delivery of the program are
responsible for the very low participation by socially disadvantaged
producers, especially because Hispanic producers, for example,
constitute one of the fastest growing populations of new entrants into
agriculture. Also, the very low proportion of women producers who
participate also warrants examination, as this is another example of a
population whose participation in agriculture is growing.
As we have researched this question, we have several suggestions:
the definition of beginning farmer still requires 3 years of management
of experience. How this experience is defined and accounted for by the
department may have a bearing on who is accepted into the program. We
recommend, for example, that experience as a farmworker be counted
towards the qualification for beginning farmers. In addition, the
standards for credit worthiness are as stringent or more stringent than
the standards used by commercial lenders.
As this Committee considers the recommendations to target all
credit to beginning and socially disadvantaged farmers, it will be
important to consider how this recommendation may ultimately affect the
availability of credit. For example, farmers who have left the peanut
and tobacco programs or who are otherwise transitioning to different
crops may be in need of credit for this transition. Also, directing
resources generally to beginning and socially disadvantaged farmers and
ranchers without more specific direction with respect to the
proportions of funds for either population may have the impact of
disadvantaging one or the other of these populations, most likely
socially disadvantaged producers.
It is also important to realize that socially disadvantaged
producers have historically had very low participation rates in
commodity and conservation programs. The billions of dollars in Federal
support provided for these programs only reaches a small percentage of
these producers. The reasons for lack of access to Federal farm
programs are also complex. However, the net impact of this exclusion
has often affected the size of operations and the quality of the land
accessible to socially disadvantaged producers, leaving less equity in
the hands of socially disadvantaged farm families. As a result, credit
scores may be lower and it may be more difficult for these families to
at first meet the stringent creditworthiness standards FSA requires.
We believe that special attention will need to be paid to these
definitions and situations in order for USDA to fulfill its mission as
lender of last resort, and in order to assure access to credit for
socially disadvantaged farm families who wish to enter or continue in
agriculture.
Transparency and Accountability in Farm Loan Programs--In recent
years, the Farm Service Agency has routinely reported that loans to
socially disadvantaged farmers are made in 30 days or less, and on par
with loans to other farmers. FSA staff throughout the nation can report
these statistics with respect to their own county and state. With these
statistics as a sole reference point, it would appear that all is well
with respect to access to credit and delivery of services.
We believe these statistics are not a true picture of the actual
situation. We urge the Committee to look further and to establish some
of the measures we have long proposed in order to move beyond the
appearance of equity to real equity in services, and the establishment
of new generations of people of color farmers on the land.
Over the years, we have observed and documented many practices that
serve to discourage and separate minority farmers from the programs and
services they need. We will briefly review some examples of these
practices and some solutions we recommend.
Discouragement of Applications and Services--At the National
Immigrant Farming Initiative meeting in February in Las Cruces, New
Mexico, a Hmong farmer approached our Executive Director from
Wisconsin. ``How big is a farm?'' she asked the ED. In attempting to
understand the reason for her question, we determined she had been
turned away by the local FSA office after being told her operation was
not a farm. However, this producer reported that she owned land and
sold more than $1000 of produce a year. She did not understand why she
was turned away and had not been asked to provide information to be
listed on the County SCIMS list.
In the aftermath of [H]urricanes Katrina and Wilma, we held a
training session for some 50 Latino producers in Dade County, Florida.
Four members of the FSA staff attended the session at our request. The
producers present reported a typical pattern: following these and
previous disasters, they called the county office to request disaster
assistance. The office confirmed reports that they producers were told
there was no assistance available. The answer was technically correct
at the time, as it is usually long after a disaster that Congress
approves aid.
However, the producers were not told to come into the office to
sign up on the SCIMS list, or to begin the application process for any
available programs, or of requirements to take out crop insurance. The
FSA staff reported that they were too busy to schedule appoints and
have the farmers come in. As a result, the farmers--some repeatedly and
after multiple disasters--were never informed of the many services FSA
might provide, of the need to have crop insurance in order to qualify
for most emergency aid, and of records they needed to keep to qualify
for the emergency conservation program. They also were not included on
the county list to receive newsletters and other important information
and notifications, including loan and insurance deadlines and
notification of funds available. As a result of not being included on
the SCIMS list, farmers were also being missed in the Census of
Agriculture.
During the training, the FSA staff registered over \1/4\ of the
farmers who attended who had not previously been included on the SCIMS
list or received any service from USDA. Other farmers were informed of
the documents they needed to bring and of the need to go into the
office in the future to register. However, the outreach function that
FSA needs to perform routinely was only completed because the Farm Aid
supported training and organizations, including ours, went to the
county to inform farmers of the services to which they are entitled.
FSA should be required to tell all farmers who request any service
of the need to be listed on the SCIMS list and of their right to make
an application whether or not the office is inclined to view them as
qualified.
First Come, First Served Standard--FSA credit program funds are
delivered by state and county based on the number of farmers, the size
of operations, etc. Previous investigations by GAO and IG have found
that despite the fact that socially disadvantaged farmers had been
denied credit, this practice did not constitute discrimination because
the applications were only denied due to lack of funds.
However, this standard is manifestly unfair when farmers are
discouraged from applying for programs, are not included on county
lists or otherwise informed in a timely manner of the availability of
funds. If a local office wished to assure funds for some farmers over
others, there is the risk that a conflict of interest is created
without some independent verification that all farmers receive the same
information and ability to access the funds.
We believe this situation is especially serious with regard to the
provision of disaster loans. While we do believe loan limits need to be
raised, we caution the Committee that increasing these limits without
increasing the level of funding may in fact exacerbate the potential
inequities of accessing limited pools of loan funds.
What Constitutes an Application--FSA does not consider a farmer to
have applied for loan until the loan application is complete. While
improvements have been made in informing farmers what documentation is
necessary for an application, we have heard many stories of lengthy
processes where additional information is requested. For some farmers--
e.g., American Indian producers who often live long distances from
county offices, the need to return to the office with additional
documents greatly lengthens the application process.
However, the final rule 12CFR Part 202, Regulation B, Docket No R-
1008, implementing the Equal Credit Opportunity Act states:
(e) Applicant means any person who requests or who has
received an extension of credit from a creditor, and includes
any person who is or may become contractually liable regarding
an extension of credit . . .
(f) Application means an oral or written request for an
extension of credit that is made in accordance with procedures
used by a creditor for the type of credit requested. The term
application does not include the use of an account or line of
credit to obtain an amount of credit that is within a
previously established credit limit. A completed application
means an application in connection with which a creditor has
received all the information that the creditor regularly
obtains and considers in evaluating applications for the amount
and type of credit requested (including, but not limited to,
credit reports, any additional information requested from the
applicant, and any approvals or reports by governmental
agencies or other persons that are necessary to guarantee,
insure, or provide security for the credit or collateral). The
creditor shall exercise reasonable diligence in obtaining such
information.
According to this regulation, an applicant includes a person who
has requested credit, and an application includes oral and well as
written requests for credit. While an application is defined as made in
accordance with procedures used by a creditor, the regulation makes a
distinction between an application and a completed application.
Thus, in order to evaluate the fairness of the system FSA has in
evaluating applications, we recommend that Congress direct that FSA
revise its reporting system to reflect the period of time it takes to
process a credit application from the first submission of an
application to the completion of the process. This would be a fairer
reflection of the time period needed for processing.
We also recommend that Congress amend the 10708 requirements of the
farm bill to require FSA to report on the national, state and county
level by race, gender and ethnicity, the months in loan funds were
disbursed under each type of loan program.
It makes a great deal of difference whether a loan is disbursed
early in the planting season or at a later date.
Receipt for Service--Since 2002, we have proposed to the department
and to Congress that USDA be required to provide to all farmers and
ranchers a time and date stamped ``receipt for service.'' This receipt
should be provided whenever any farmer requests an application or
service. The receipt should details the name of the farmer or
prospective farmer, the location of the office by county, what was
requested, what was provide and not provided, if a request was not met,
why the application or service was not provided, and what follow-up
action is recommended or required. A copy of the receipt, which could
be generate electronically, should be given to the farmer, and one
maintained in the office. Because these receipts would not be used to
evaluate applications for programs and services, Congress should also
include authority and require FSA and other agencies to collect data by
race, gender and ethnicity using both self-identification, and
identification by the agency when the first is not provided, in order
to evaluate its responsiveness.
This receipt would be critical to assuring equity for programs that
are provided on a first come first serve basis, and to document
situations where farmers and prospective farmers are discouraged from
seeking and applying for benefits.
In addition, it would also document and allow Congress and the
Department to review to the county level the actual dates on which all
applications were received by the agency, and to identify places where
some farmers and ranchers may receive information, services and
approval more immediately than others.
USDA responded to our recommendations for a receipt for service by
instituting a Customer Comment Card. This card does not serve the same
purpose as a service receipt and goes back to the same complaint
generated system of accountability that has hampered fairness for many
years.
Creditworthiness--Many of the laws that govern farm credit arose
from the agricultural credit crisis in the 1980's. While borrowers
rights and other protections were included, the experience of losses by
the government, primarily with respect to emergency loans, led to the
inclusion of good faith provisions and stringent creditworthiness
standards.
In the present time, evaluation by FSA of creditworthiness is a
factor that prevents many socially disadvantaged producers from
securing credit. Our member organizations have reported that FSA's
system of determining creditworthiness is often a factor that results
in the denial of applications. We believe the FSA scoring system should
be reviewed based on the following standards in ECOA (final rule 12 CFR
Part 202, Regulation B, Docket No R-1008):
(p) Empirically derived and other credit scoring systems--(1)
A credit scoring system is a system that evaluates an
applicant's creditworthiness mechanically, based on key
attributes of the applicant and aspects of the transaction, and
that determines, alone or in conjunction with an evaluation of
additional information about the applicant, whether an
applicant is deemed creditworthy. To qualify as an empirically
derived, demonstrably and statistically sound, credit scoring
system, the system must be:
(i) Based on data that are derived from an empirical
comparison of sample groups or the population of
creditworthy and noncreditworthy applicants who applied
for credit within a reasonable preceding period of
time;
(ii) Developed for the purpose of evaluating the
creditworthiness of applicants with respect to the
legitimate business interests of the creditor utilizing
the system (including, but not limited to, minimizing
bad debt losses and operating expenses in accordance
with the creditor's business judgment);
(iii) Developed and validated using accepted
statistical principles and methodology; and
(iv) Periodically revalidated by the use of
appropriate statistical principles and methodology and
adjusted as necessary to maintain predictive ability.
(2) A creditor may use an empirically derived, demonstrably
and statistically sound, credit scoring system obtained from
another person or may obtain credit experience from which to
develop such a system. Any such system must satisfy the
criteria set forth in paragraph (p)(1)(i) through (iv) of this
section; if the creditor is unable during the development
process to validate the system based on its own credit
experience in accordance with paragraph (p)(1) of this section,
the system must be validated when sufficient credit experience
becomes available. A system that fails this validity test is no
longer an empirically derived, demonstrably and statistically
sound, credit scoring system for that creditor.
Congress should review the FSA credit scoring system and the
methods that it has used to develop and validate this system. It should
determine if this system is periodically reviewed and maintains
predictive ability. As the lender of last resort, FSA standards for all
loans should be less stringent when compared to commercial lending.
Congress should request that FSA compare its standards with those of
commercial lenders.
Because of this history of discrimination that has held this agency
liable for hundreds of millions of dollars of losses caused by the
practices of the agency itself, Congress should assure that this system
take into account the influence of these practices on the
creditworthiness of the producers who now seek loans.
Congress should also determine to what extent approval of credit
rests on access to income from other Federal farm programs, and the
degree to which the creditworthiness of socially disadvantaged farmers
is affected by the degree of access they have to other programs.
The 10708 Transparency and Accountability Requirements should be
amended to include a report on the number and percentage of farmers by
race, gender and ethnicity who participate in multiple USDA programs,
and the level of total benefits that are provided to producers by race,
gender and ethnicity.
Waiver of Interest--In the wake of entreaties to declare
moratoriums and take other action to resolve the crisis facing socially
disadvantaged farmers who have suffered discrimination and all farmers
who have faced serious losses as a result of the hurricanes of 2005,
repeated drought and other national disasters, FSA has repeatedly
asserted that it lacks the authority to waive interest
We recommend that this Committee determine in fact whether any
additional authority is required to provide this authority to FSA. For
example, are the Standards for the Administrative Collections of
Claims, 31 CFR 901.9 on Interest, penalties, and administrative costs
adequate for this purpose?
(g) Agencies shall waive the collection of interest and
administrative charges imposed pursuant to this section on the
portion of the debt that is paid within 30 days after the date
on which interest began to accrue. Agencies may extend this 30
day period on a case-by-case basis. In addition, agencies may
waive interest, penalties, and administrative costs charged
under this section, in whole or in part, without regard to the
amount of the debt, either under the criteria set forth in
these standards for the compromise of debts, or if the agency
determines that collection of these charges is against equity
and good conscience or is not in the best interest of the
United States.
(h) Agencies shall set forth in their regulations the
circumstances under which interest and related charges will not
be imposed for periods during which collection activity has
been suspended pending agency review.
The fair resolution of all outstanding claims related to
discrimination by the Farm Service Agency certainly should be
considered a matter of equity and good conscience, and in the best
interest of the United States. We recommend the Committee review this
authority, and also require FSA to report on its compliance with
paragraph h of this section.
We also urge that the Committee review the regulations instituted
following the disasters in 2005 that allowed the suspension of payments
on loans for farmers in declared disaster areas, but without any waiver
of interest, and that required a balloon payment of all the deferred
payments and interest in January 2007. A report on the number and
location of loans that may be forced into acceleration because of an
inability to make this balloon payment should be made, and Congress
should undertake any retroactive and remedial action necessary to
prevent additional loss of farms in the wake of disasters.
Appraisals--Over the years, we have received continued complaints
for farmers on the fairness of the appraisals used for loan approvals.
Standards for appraisals should be reviewed and assurance of equal
credit opportunity protections be established.
While in small rural communities, testing programs such as those
widely used in mortgage lending are more difficult to establish, the
Congress should consider ways to work through the Comptroller of the
Currency to provide funding and guidance for some measure of testing to
bring to light problems in both direct and guaranteed lending programs
of the department, especially with regard to appraisals.
Right of First Refusal on Inventory Property--In the 1987
Agriculture Credit Act, this Committee wrote the very first provisions
designed to begin assisting socially disadvantaged farmers and
ranchers. On provision of this law afforded socially disadvantaged
farmers and ranchers the right of first refusal on inventory property.
When Congress subsequently instituted programs for beginning farmers
and ranchers, it replaced the right for socially disadvantaged farmers
and ranchers with the right of first refusal for beginning farmers.
This situation is instructive and illustrates why in the 2007 Farm
Bill debate, careful attention needs to be paid to securing an
appropriate balance in credit law (and other areas of the farm bill) to
the needs of these two populations. At a minimum, we suggest that the
right of first refusal be restored first for socially disadvantaged
farmers and ranchers, and then for other beginning farmers and
ranchers.
Loan Limits--We agree with proposals to increase loan limits
especially for farm ownership loans to more accurately reflect the
current costs farmers face. But at the same time, we encourage this
Committee to consider the impacts we have outlined above, and the need
to provide more funding for direct loans.
Transparency and Accountability--The Federal Government has been
held liable for hundreds of millions of dollars of payment to farmers
who won discrimination claims primarily in credit programs. While we
would argue that most socially disadvantaged farmers were also denied
access in many ways to other Federal farm programs, their right to seek
damages is only secured for credit programs.
Virtually all actions to assure fair service by FSA and other USDA
actions arise from individual complaints made by farmers and ranchers.
In Section 10708 of the 2002 Farm Bill, Congress adopted Transparency
and Accountability requirements that require the department to provide
data at the national, state and local level on participation rates by
race, gender and ethnicity for each program that serves farmers.
FSA has been the most responsive agency in providing the data
required under this section.
However, the usefulness of this data has been severely compromised
by the matter of presentation used in the reports that are compiled by
the Office of the Assistant Secretary for Civil Rights. Instead of
providing searchable databases, the Office of the Assistant Secretary
has presented the participation rates down to the county level as
120,000 separate PDF charts.
Ostensibly, the reason for this method or presentation is in order
to protect the privacy of the lone socially disadvantaged farmer who
may participate in a particular program of the department in a
particular county. The U.S. Census and the Census of Agriculture have
developed other methods and defaults to protect privacy that do not
compromise the integrity and usefulness of the data.
In addition, USDA has not provide, as required in 10708, a report
that compares the participation of farmers by race, gender and
ethnicity in programs as compared to their representation in the Census
of Agriculture
Earlier in this testimony, we provided the 10708 report for the
Beginning Farmer Down Payment Loan Program. In the appendix we have
provided 10708 reports for other programs. A review of all of these
programs would show that the participation rates of socially
disadvantaged producers are abysmally low. Only in programs
specifically constructed, for example, to serve American Indian
farmers, is participation assured. The highest level of participation
in any other program we found in our review was participation of 8% to
9% by African American producers--in the peanut buyout program.
The 10708 requirements are a very important tool for the department
and Congress to develop an independent assessment of the problems in
service delivery and program structure that may present barriers to
equitable participation of producers. This data should be presented in
a format that will allow real comparisons between similar counties and
states that would allow service delivery issues to be identified and
rectified, and would also allow Congress to determine where program
structures and rules may be responsible for barriers to service.
County level data, and comparisons at that level to Agriculture
Census numbers will allow agencies, farmers, and the organizations that
represent them not only to identify programs where participation is
inadequate. It will also allow outreach services and remedial actions
to be taken. In addition, Congress should require that this data be
utilized in the evaluation of all programs and in performance reviews
of staff. In the 2002 hearing in the House Agriculture Committee, USDA
testified that in the wake of the massive discrimination liabilities
against the department, only an handful of staff received reprimands or
any other personnel action. The lack of accountability to agencies and
staff continue to foster a climate that leaves no consequence for
actions that are contrary to the interests of socially disadvantaged
producers, taxpayers and the United States.
We recommend that USDA be asked immediately to provide the required
report comparing Agriculture Census data to the participation reports,
and for its proposals on how immediate changes can be made in order to
provide 10708 data in a useful form. We will provide to the Committee
proposed language to amend 10708 in order to assure this requirements
provide the system of review that is vital to assuring quality programs
and fair service.
Interest Subsidies--FSA has authority and does provide subsidized
interest for farmers. Congress should assure that funds are adequate
for this program, which is important to farmers. In addition, FSA
should provide a 10708 report on participation in this program.
Farm Loans and Disasters--Emergency loans are critical to producers
in the face of disasters. In addition, measures to protect the ability
of farmers to manage current loans are also needed. However, in order
to allow these to help farmers in a manner that will prevent placing
them later in a precarious situation, we recommend the following
measures:
b Review and provide any additional authority to allow FSA to suspend
the accrual of interest in times of disaster, and take
additional measures as necessary to allow delay in payments.
b Add payments to end of loans and allow extension of loans.
b Extend PL 108-324 to remove the limit of coverage for farmers who
have experienced multiple disasters.
b Set in place an automatic disaster set aside for payments on direct
FSA and RHS loan installments due in January 2007. Enable and
encourage private lenders with guarantees to do the same.
b Complete suspension of offsets.
b Expand servicing for 90 days past due loans.
b Provide Loan forgiveness for those who will never be able to pay or
who have suffered losses that reduce the value of collateral.
b Allow appeal between agencies--when denied by Farm Service Agency
and Small Business Administration, allow appeals to both.
Credit and Indian Agriculture--The United States Government through
Farm Service Agency remains the largest source of lending for Indian
Reservations. Farm lending programs need to increase their focus on
youth lending as well as new farmer lending. The present beginning
farmer program needs to be modified to realistically fit a beginning
farmer. Present criteria limits participation to only those that have
adequate capital that would allow borrowing at any commercial credit
source.
Increased effort must be put forth to facilitate the
insurance that trust lands stay in trust during the debt
servicing process of FSA. The new Administration of the
Department of [the] Interior may be receptive to the transfer
of trust title between Interior and FSA. The options presented
by the 98 Credit Amendments need to be utilized by FSA, BIA and
Tribes.
Increased participation in FSA lending programs would take
place if qualifying Tribal Credit Branches were allowed
guaranteed lender status.
The Tribal Credit Outreach Program should be expanded to
cover a minimum of 18 states, where the largest Indian
populations exist. The Extension Indian Reservation Program
must be expanded to its original authorization and design that
was 85 extension agents and a minimum budget of $6 million.
Offices on Indian Reservations--In Section 2501 of the 1990
Farm Bill, Congress prohibited USDA agencies from paying the
cost of offices on Indian Reservations. Authority should be
restored to FSA and other agencies to cover the cost of offices
on Indian Reservations.
The Indian Land Acquisition Program, which allows protection
of Tribal lands, should be expanded, and a similar program
established for other socially disadvantaged producers.
Experience--Many new entry producers have strong experience in
agriculture either as farmworkers or in the case of many refugee and
immigrant farmers, experience as producers in other countries. While
legal residents are eligible for loan programs, it is critical that FSA
recognize farm and management experience gained as farmworkers or as
producers in other countries as experience in qualifying for a loan.
Moratorium on Accelerations and Foreclosures for Socially
Disadvantaged Farmers and Ranchers--African American producers have
experienced a stunning 97% loss of farms since 1920. Special strategies
and emergency action to stem this loss, and to reduce land loss for
American Indian and other socially disadvantaged producers. The most
urgent need is an immediate moratorium to protect African American
farmers and ranchers who now face imminent foreclosure following
inadequate protection and outcomes of civil rights complaints and
individual and class action lawsuits. This immediate stay should be
applied as well to other filed discrimination cases and administrative
complaints that are pending for all socially disadvantaged farmers and
ranchers.
In the farm bill, we propose that Congress declare a moratorium
that provides an immediate stay on all accelerations and foreclosures
against all socially disadvantaged farmers and ranchers and establish a
review commission to be charged with reviewing all pending actions
against socially disadvantaged farmers and ranchers. In addition,
Congress should provide clear authority requiring the Secretary to
waive interest and offsets, and to write off interest for all such
cases during the review; and to forgive loans in cases where government
action or inaction led to the foreclosure action.
This Independent Socially Disadvantaged Farmer Foreclosure Review
Commission should:
Determine whether farm land foreclosed and accepted for
review by the commission complies with applicable laws or
regulations, and
Determine if actions or inactions of the government led to
the foreclosure action.
Review and improve upon the credibility and accuracy of the
USDA Farm Credit Foreclosure process and procedures,
Report programmatic inefficiencies to the House and Senate
Agriculture Committee that include recommendations for legal
remedies to address wrongful foreclosures against African
American and any other socially disadvantaged producers.
Culturally Appropriate Service Delivery--FSA should conduct
outreach and deliver service in a manner that is culturally appropriate
and language accessible for socially disadvantaged producers, and
should retain adequately trained loan program staff with the linguistic
and cultural background adequate to serve farmers in the region.
Proposals for New Programs to Restore Equity--In order to begin the
process of restoring access to socially disadvantaged producers who
have been severely compromised in their ability to access land and
operate viable operations, we propose a new credit program, and we
encourage the Committee to support and endorse a more comprehensive
approach to assist this population of farmers to engage with the full
range of USDA programs and Services.
New Low Documentation Loan Program for Socially Disadvantaged
Farmers and Ranchers--Many socially disadvantaged producers with small-
scaled diversified operations could achieve real viability with more
flexible financing tools. We recommend that this Committee establish a
new socially disadvantaged farmers and rancher flexible loan program.
We recommend that this be established at a maximum level of $50,000 per
loan and that it be operated as a renewable line of credit that the
producer may draw on again in future years when the balance is reduced
below the limit.
We recommend that the interest rates be below market rates, and
that a quick approval low documentation process be used. The lower loan
rate reduces risk to the agency, but allows the flexibility that many
producers need. Authority should also be provided to make individual
loans for members of cooperatives of groups of farmers in order to
allow development of value added and cooperative businesses that can
best be conducted beyond the level of the individual.
Socially Disadvantaged Producers Risk Management and Market Access
Initiative--We recommend that Congress establish a new comprehensive
program to assure protections and market access that socially
disadvantaged farmers need to attain financially viable operations that
benefit also the poor rural communities where many of the live.
We share this recommendation with this subcommittee because we
believe a comprehensive approach to service for this population would
reduce the risk and increase opportunities for socially disadvantaged
farmers with respect to loan programs as well.
This initiative is a comprehensive legislative approach designed
to:
preserve and build land ownership by Socially disadvantaged
farms and ranchers
bring socially disadvantaged producers into USDA programs
and assure more accurate counting of this population in the
Census of Agriculture;
contribute to rural communities, and
to address the following challenges socially disadvantaged
farmers and rancher face:
risk management and disaster protection,
Secure access to land, credit and markets
Facilitate transition from tobacco and peanuts and
other crops and to organic productions, value added,
Improve record keeping, general farm and financial
management practices and meeting all regulatory
requirements
Under this initiative, funding and technical assistance will be
provided directly to farmers and ranchers, including beginning socially
disadvantaged producers and farmworkers seeing to become farmers and
ranchers, and who meet the criteria in order to carry out the
applicable functions. Community Based organizations would receive
direct support from RMA to supply the technical assistance
Eligibility: A socially disadvantaged farmer or ranchers.
Qualification level--The producers is awarded an Initial
payment of $5,000, half paid in advance. The producer must
within 1 year prepare IRS schedule F or a qualified substitute
for members of Indian Tribes. The producer must also sign up
for any crop insurance or NAP programs for which he or she is
qualified, and must register at the FSA office, and FSA must
provide his or her name to the National Agriculture Statistics
Service for inclusion in the next Census of Agriculture. A
qualified Technical Assistance Provider will receive $2,000 to
assist the farmer in preparing these documents and accessing
these services and in preparing a plan to apply for
participation in Tiers I, II and III. The producer is also
encouraged and may use technical assistance to be included in
the Minority Farm Registry or complete the Census of
Agriculture if applicable in that year.
The producer must remain qualified at this level in order to
participate in Tiers I, II or III.
Tier I Direct payments of $10,000 per year to complete at
least three of the following:
A farm and home plan,
Applications for any USDA program for which he or she
is eligible
An estate plan,
A risk management plan, including accessing family
health insurance
A conservation plan
Land acquisition
Disaster protection or mitigation
Plan to transition to another crop or crops
A qualified Technical Assistance Provider will receive
$3,000 to assist the farmer in accessing these services
Tier II--Direct payment of $25,000 per year to complete at
least three of the following:
Meet standards for GAP, Organic certification
Make a marketing plan
Access liability or other expanded insurance,
including revenue insurance
Access farmers['] markets or improved marketing
contracts
Make a plan to meet other regulatory requirements,
including labor and pesticide health and safety standards,
Livestock and Animal ID
Mentor another farmer
Qualifies for SARE
Irrigation and other production assistance
Waste management
A qualified Technical Assistance Provider will receive
$4,000 to assist the farmer in preparing these documents
and accessing these services
Tier III--Direct payment of $45,000
Cooperative development and the development of value-
added enterprises.
Infrastructure development
Enter nutrition programs such as school lunch, WIC,
farmers['] market, senior nutrition, etc.
Energy
Rural Development
A qualified Technical Assistance Provider will receive
$5,000 to assist the farmer in preparing these documents
and accessing these services
Additional Provisions
Make this a program under the commodities title and locate
in RMA Outreach and Civil rights office.
Community-based organizations would provide technical
assistance.
Provide Funds for additional staff for RMA regional offices
and at headquarters.
Authorize and Support the Small Farms Emphasis Program to
work across agencies at USDA to assure coordination of services
for socially disadvantaged farmers under this program.
Include automatic entry into some USDA programs for
completion of certain tiers.
Conclusion
We appreciate this opportunity to share our insights and
recommendations with you. We are most willing to answer now or in the
future any questions you may have or to offer any assistance we are
able to the Committee or to the Secretary to make USDA-Farm Service
Agency Credit programs and services more equitable.
Appendix A--Samples of USDA 10708 National Program Participations
Reports
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Program Participation Report
Program National Summary
Fiscal Year: 2003
Farm Service Agency
Peanut Quota Buyout Program
----------------------------------------------------------------------------------------------------------------
Male
Female
Unknown
----------------------------------------------------------------------------------------------------------------
Hispanic or Not Hispanic Hispanic or Not Hispanic or Not Undiscloded
Latino or Latino Latino Hispanic or Latino Hispanic or Ethnicity
Latino Latino
----------------------------------------------------------------------------------------------------------------
Participatio Participatio Participati Participati Participati Participati Participati
n Indicator n Indicator on on on on on
Indicator Indicator Indicator Indicator Indicator
----------------------------------------------------------------------------------------------------------------
White <3% 46.3% <3% 32.8% <3% <3%
Black <3% 8.4% <3% 9.5% 0% <3%
AI/AN 0% <3% 0% <3% 0% <3%
Asian 0% <3% 0% <3% 0% <3%
HPI <3% <3% 0% <3% 0% <3%
Other <3% <3% <3% <3% <3% <3%
Multi 0% <3% 0% <3% 0% <3%
Unclass 0%
--------------------------------------------------------------------------------------------
Total............ <3% 54.1% <3% 42.7% <3% <3% 0%
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Program Participation Report
Program National Summary
Fiscal Year: 2003
Farm Service Agency
Guaranteed Farm Operating Loan Program
----------------------------------------------------------------------------------------------------------------
Male
Female
Unknown
----------------------------------------------------------------------------------------------------------------
Hispanic or Not Hispanic Hispanic or Not Hispanic or Not Undiscloded
Latino or Latino Latino Hispanic or Latino Hispanic or Ethnicity
Latino Latino
----------------------------------------------------------------------------------------------------------------
Participatio Participatio Participati Participati Participati Participati Participati
n Indicator n Indicator on on on on on
Indicator Indicator Indicator Indicator Indicator
----------------------------------------------------------------------------------------------------------------
White <3% 40.9% <3% <3% <3% 54.7%
Black <3% <3% 0% <3% <3% <3%
AI/AN <3% <3% 0% <3% 0% <3%
Asian <3% <3% 0% <3% 0% <3%
HPI 0% <3% 0% <3% 0% <3%
Other <3% 0% <3% 0% <3% <3%
Multi 0% 0% 0% 0% 0% 0%
Unclass 0%
--------------------------------------------------------------------------------------------
Total............ <3% 41.8% <3% <3% <3% 55.8% 0%
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Program Participation Report
Program National Summary
Fiscal Year: 2003
Farm Service Agency
Non-Recourse Marketing Assistance Loan and Loan Deficiency Program
----------------------------------------------------------------------------------------------------------------
Male
Female
Unknown
----------------------------------------------------------------------------------------------------------------
Hispanic or Not Hispanic Hispanic or Not Hispanic or Not Undiscloded
Latino or Latino Latino Hispanic or Latino Hispanic or Ethnicity
Latino Latino
----------------------------------------------------------------------------------------------------------------
Participatio Participatio Participati Participati Participati Participati Participati
n Indicator n Indicator on on on on on
Indicator Indicator Indicator Indicator Indicator
----------------------------------------------------------------------------------------------------------------
White <3% 71.2% <3% 24.9% <3% <3%
Black <3% <3% 0% <3% 0% <3%
AI/AN <3% <3% <3% <3% 0% <3%
Asian 0% <3% <3% <3% 0% <3%
HPI 0% <3% 0% <3% 0% <3%
Other <3% <3% <3% <3% <3% <3%
Multi 0% <3% 0% <3% 0% <3%
Unclass 0%
--------------------------------------------------------------------------------------------
Total............ <3% 72.3% <3% 25.8% <3% <3% 0%
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Program Participation Report
Program National Summary
Fiscal Year: 2003
Farm Service Agency
Conservation Reserve Program
----------------------------------------------------------------------------------------------------------------
Male
Female
Unknown
----------------------------------------------------------------------------------------------------------------
Hispanic or Not Hispanic Hispanic or Not Hispanic or Not Undiscloded
Latino or Latino Latino Hispanic or Latino Hispanic or Ethnicity
Latino Latino
----------------------------------------------------------------------------------------------------------------
Participatio Participatio Participati Participati Participati Participati Participati
n Indicator n Indicator on on on on on
Indicator Indicator Indicator Indicator Indicator
----------------------------------------------------------------------------------------------------------------
White <3% 68.9% <3% 27.6% <3% <3%
Black 0% <3% 0% <3% 0% <3%
AI/AN <3% <3% <3% <3% 0% <3%
Asian <3% <3% 0% <3% 0% <3%
HPI <3% <3% <3% <3% 0% <3%
Other <3% <3% <3% <3% 0% <3%
Multi 0% <3% 0% <3% 0% <3%
Unclass 0%
--------------------------------------------------------------------------------------------
Total............ <3% 69.9% <3% 28.2% <3% <3% 0%
----------------------------------------------------------------------------------------------------------------
Appendix B
Information Required From Non-governmental Witnesses
Biographical Sketch
John Zippert,
Federation of Southern Cooperatives/Land Assistance Fund,
[Redacted],
Epes, Alabama
Email: [Redacted] Phone: [Redacted]
Mr. John Zippert, Director of Program Operations of the Federation
of Southern Cooperatives/Land Assistance Fund is a community organizer
and a tireless advocate of economic and rural development for Black
farmers. He has a BA degree in history from the City College of New
York and has participated in numerous training sessions and courses to
enhance his skills in rural development.
The Federation of Southern Cooperatives/Land Assistance Fund
currently has over 70 active cooperative member groups, themselves with
a membership of more than 20,000 families working together across ten
southern states, with a concentration in Mississippi, Alabama, Georgia
and South Carolina.
John has held a number of positions in the Federation of Southern
Cooperative including co-founder and field leader. In his current role
as Director of Program Operations, he is assisting in the development
of programs designed to save, protect and expand the landholdings of
Black family farmers in the South. He also works to develop, advocate
and support public policies to benefit the membership of Black and
other family farmers and low-income rural communities. He has fought
for economic justice for more than 40 years. John has worked in
distressed communities in cooperative and credit union development to
provide technical assistance and training to individuals from low-
income rural communities who have determined a need for low cost,
community controlled consumer credit.
The Federation has participated in policy and advocacy and
organized in rural communities to build a base for change. With hard
work, collaboration with many other groups, and a consistent program of
community and civic education, the Federation was able to get portions
of this advocacy agenda incorporated in national farm legislation.
On October 10, 2002, John testified before the U.S. House of
Representative's Agriculture Committee on issues pertaining to civil
rights programs at the U.S. Department of Agriculture (USDA). He told
Congress that ``injunctive relief provided in the settlement has not
been clearly translated in Federal regulations and actual practice at
county level FSA offices. A number of farmers,'' he said, ``have
reported to me that they were laughed at, ridiculed, or told `no such
benefits existed', when they attempted to secure this most important
forward-looking benefit of the settlement of the law suit.'' One of the
benefits for class members includes priority consideration in USDA
offices for receiving assistance in loan packaging. The response at FSA
offices is part of the general pattern of continuing discrimination and
retaliation against Black farmers.
Zippert has served on the boards of many national, regional, state
and local organizations. He is currently the elected chair of the Board
of the Rural Coalition/Coalicion Rural. He has also served on the
boards of Association for Community Based Education, Rural Development
Leadership Network, Alabama Black Belt Action Commission, Alabama
Council on Human Relations, Alabama Organizing Project, Alabama New
South Coalition, Greene County Industrial Board, Greene County Hospital
and Nursing Home and the Greene-Sumter Enterprise Community to name a
few. John and his wife Carol are co-publishers and editors of the
Greene County Democrat, the weekly newspaper in Eutaw, Alabama since
1984. The Zipperts have three children, Rachel, Alexandria and Simon
and nine grandchildren.
[Congressional Letters and Testimony 4]
Statement of John Zippert on Behalf of the Federation of Southern
Cooperatives/Land Assistance Fund and the Rural Coalition/
Coalicion Rural to the U.S. House of Representatives, Committee
on Agriculture, Subcommittee on Departmental Operations
Washington, D.C.
September 25, 2002
My name is John Zippert. I am Program Director of the Federation of
Southern Cooperatives/Land Assistance Fund and Chairperson of the Rural
Coalition. I personally have worked on promoting equity in poor rural
communities for more than 35 years, starting in St. Landry Parish
Louisiana with the Congress of Racial Equality. I have worked with the
organizations I represent today for many years.
I have personally assisted over 650 farmers in Alabama in the
preparation of claims and other documents in response to the Pigford v.
Glickman Consent Decree. I have done this work in a paralegal capacity,
under the auspices of the Chestnut, Sanders and Sanders law firm in
Selma, one of the law firms connected to the class counsel in the
lawsuit.
I assisted over 200 farmers to file initial claims in the case; I
assisted another 200 to file for reconsiderations with the Monitor,
when their initial claim was rejected by the adjudicators; and I have
helped 350 farmers to file late claims and additional documentation on
late claims.
According to statistics supplied by the court monitor, of the five
states with the highest number of responses, Alabama has the highest
rates of approval at 67%.
Relevant Experience of Our Organizations to Address the Questions in
this Hearing
We appreciate this opportunity to speak candidly to you on behalf
of both of these organizations to address the question of ``Resolving
and Removing the Need for Litigation Against USDA.'' The organizations
I represent are uniquely qualified to answer this question.
Collaboratively and for many years, these groups have served as the
primary and often only source of technical assistance and support to a
significant proportion of the minority farmers in this nation.
The Federation of Southern Cooperatives/Land Assistance Fund has
for more than 30 years worked with African-American farmers and
landowners in some of the poorest counties in the nation. Our
membership includes over 75 cooperatives and credit unions. Through our
outreach program, we provide land and agriculture-related assistance to
over 12,000 rural families.
The Federation implements its various programs throughout the
southeast but is concentrated primarily in Alabama, Mississippi, South
Carolina, Georgia and north Florida. Over the years, we have worked one
on one with minority farmers and their cooperatives to develop new
enterprises. A great deal of our work has had to be focused on saving
Black-owned farms and assisting their owners to fairly access farm
credit and other farm programs and services. We have assisted hundreds
of farmers in seeking redress for discrimination and in responding to
the class action settlement in Pigford v. Glickman. Of necessity, we
have also sought legal and legislative remedies to assure fair and
equitable service to minority producers, including the Minority Farmers
Rights Act, which passed as part of the 1990 Farm Bill.
The Rural Coalition/Coalicion Rural, of which the Federation is a
founding member, is an alliance of over 80 culturally and regionally
diverse rural community-based organizational in the U.S. and Mexico. We
have served minority and other limited resource producers for almost a
quarter century. The members of our Coalition include some of the most
diverse and experienced minority farm organizations including the
Intertribal Agriculture Council, the Rural Advancement Fund, which has
worked with African American producers for more than 50 years; the
North Carolina Association of Black Lawyers Land Loss Prevention
Program, the Concerned Citizens of Tillery, as well as Rural Community
Development Resources in Yakima Washington, and the Hmong American
Community in Salinas, CA, who serve the growing population of new
Latino and Asian-American farmers.
In recent years, we have worked actively to develop new methods
with our members to help USDA fill service gaps. In 1996 and 1997, in
collaboration with USDA, we trained our members on the roles and
election procedures for FSA county committees. With FSA support, we
held two outreach trainings to help our members better understand the
purposes and eligibility requirements of a wide range of USDA programs.
Collectively, the Federation, and the Rural Coalition and its
members and allies, have assisted thousands of farmers with the
intricacies of their dealings with USDA. We have attempted on many
occasions to see that USDA was held accountable for its discriminatory
practices that we have observed, and to seek structural change both
administratively and in policy. We have written letters and proposed
policy changes, including an entire Minority Farmers Rights Act,
portions of which were instituted into law in the 1990 Farm Bill.
In the past several years, we have supplied reams of documents,
analysis and testimony to the Civil Rights Action Team, the National
Small Farms Commission, the U.S. Congress and the U.S. Civil Rights
Commission. A half dozen of us served on the National Small Farms
Commission, and we have also participated on other committees and in
many sessions with the Secretary and the staff of the Department.
Our collaborative legal and legislative work included the 1987
Agriculture Credit Act, the 1990 Farm Bill, the 1994 Agriculture
Reorganization Act, and the Waiver of the Statute of Limitations which
removed a critical barrier to the settlement of the longstanding class
action lawsuits.
We have also worked with you on the most recent 2002 Farm Bill. We
appreciate the support the Members of this Committee who helped assure
that the first of the structural changes instituted to prevent future
discrimination were passed in that bill.
Introduction to Our Findings
In my years of work with the Federation of Southern Cooperatives/
Land Assistance Fund, I have never met a Black farmer who was not
discriminated against. I believe the same is true for most of the
diverse group of African-American, Latino, American Indian, Asian and
female farmers represented within the Rural Coalition.
In this statement, I will first address issues surrounding the
settlement of the Pigford v. Glickman class action lawsuit. I will then
turn my attention towards the essential and fundamental changes USDA
must make in order to prevent the actions that necessitated legal
action in the first place.
We want to express the full willingness of our organizations to
cooperate with this Committee and the U.S. Congress to root out
discrimination and change unjust structures at USDA. We want to help
bring about the day when African American and other minority farmers
can turn their attention to growing crops and revitalizing rural
communities instead of filing complaints and lawsuits to secure the
equitable service to which they are entitled in the first place.
It is time to close this chapter of discrimination in farm programs
and move to a new one that supplies justice and equity that are our
rights in a democratic society.
I. Resolving Litigation and Redressing Wrongs: Pigford v. Glickman
USDA has admitted past wrongs in its practices. The court has ruled
on the Pigford v. Glickman case. The new Secretary of Agriculture
should instruct Farm Services Agency in particular to stop denying that
they did something wrong, and to cease interfering in the
implementation of the Consent Decree. She should also instruct FSA and
particularly the Office of General Counsel to stop obstructing justice
in the other farmer and employee class action lawsuits now facing the
department.
At the present time, the injustice facing Black farmers is being
compounded at the taxpayers expense by allowing USDA employees, and
particularly FSA county employees any role in responding to the court
in the Pigford case. We have also learned that USDA employees are also
assisting in appealing decisions of the arbitrator that are favorable
to the farmers. We find it abhorrent and a misuse of the public trust
that those reviewing cases and answering the courts are the same people
who caused the problems in the first place. Congress should consider it
retaliation and a violation of the ``zero-tolerance'' policy that FSA
county employees have any role at all in Pigford response, and order
this interference to cease immediately.
After the court ruled, the agencies responsible are still using our
taxpayer money to fight against and deny this discrimination, saying it
did not happen, and even exerting pressure to deny rulings made in
favor of the farmers. Extremely high paid individuals continue to argue
against cases they have already lost, actively subverting the entire
justice process at taxpayer expense. In our interactions with FSA staff
at all levels--national, state and count--we continue to encounter
blatant denial that anyone ever did anything wrong.
The fact is that discrimination did happen, both in credit programs
and in the old ASCS programs, where farmers rarely gained enough access
to the programs to generate complaints. Unless that reality is accepted
and addressed, it is highly unlikely that forward progress can be made
in creating a system that serves all farmers fairly.
Pigford v. Glickman Concerns
As of August 29, 2002, according to a report on the USDA website,
there were a total of 22,829 claims filed, of these 21,583 were deemed
eligible claims filed in the case. Of these 181 are Tract B and 21,358
are in Tract A. As more late claims are qualified and other claims are
re-evaluated, there may be additional claims added to the totals.
There were 69,265 late claims filed by the September 15, 2000
deadline. To date 58,747 late claims have been rejected and only 1,350
(1.9%) have been accepted.
Of the 21,358 eligible Tract A claims that have been adjudicated,
12,865 (60.2%) have been approved for payment; and 8,493 (39.8%) have
been rejected. 12, 597 adjudicated claims have been paid totaling
$629,850,000; 222 claims we paid for non-credit benefits only; these
claimants, although discriminated against received only $3,000 each.
An addition $17 million in loans, directly from FSA or other
Federal agencies, were canceled.
Of the more than 8,000 claims that were rejected, 6,000 have
requested a reconsideration by the Court appointed Monitor in the case.
The Monitor has reviewed a quarter of these and ruled for a
reconsideration for the farmers in 55% of these cases.
We have a number of grave concerns with the process in this Black
farmer class action lawsuit, that Congress can help illuminate and
correct, among them are:
The process in this settlement has been too complicated and
difficult for farmers to follow and comply with, which has
reduced the full number of people joining the class
There was insufficient outreach to Black farmers to explain
the settlement, during the original sign-up period, which
resulted in many eligible farmers being eliminated from the
class; the 69,265 late claims filed are an indication of this
problem. At the Federation, we are still receiving inquiries
from farmers, who felt that were left out of the case.
The claim denial rate of almost 40% has been inordinately
high and does not reflect the actual record of discrimination
by the USDA. Many farmers are being denied based on
recommendations and records of USDA ``task-force employees''
who were involved in the original record of discrimination and
should not be involved in the process. We suggest Congress
direct USDA and USDOJ to pay all eligible claims in this case,
including those denied by adjudicators based on questionable
information from the government.
The process of paying the farmers is entirely too slow. This
case was settled in April 1999 and farmers were promised and
expected payments in time for the 1999 crop season. Most
farmers were not paid in time for the 2000 crop season. Now
three crop seasons later, many farmers who were denied and have
filed for reconsideration; and many of the late claims have not
yet received a determination on their claim, as we head into
the fourth crop season since the settlement.
The approval of less than two percent (1.9%) of late claims
by Michael Lewis, the Court appointed Chief Arbitrator in the
case, should be reviewed by Congress. Lewis has failed to
inform farmers of the specific conditions and circumstances he
is accepting to find that people had ``extraordinary
circumstances beyond their control'' to allow him to approve
late claims. Initially, he rejected almost all the late claims
with no basis for appeal. Subsequently, at the urging of the
Court, he set up a review process where late claim farmers can
submit additional documentation to explain and justify their
late claims. This again is a long involved process, with many
delays and no clear due process or procedures. Congress should
take a close look at this process to insure its fairness and
equity to farmers.
The claims of some Black farmers who were discriminated
against for ``program benefits'', i.e., conservation benefits,
disaster livestock feed, adverse acreage decisions; and not
credit claims, have now been paid at a compensation of only
$3,000. This amount is not fair. These claimants have a finding
of discrimination by the independent adjudicators and they
should be paid the full $50,000 settlement amount.
The Track B process has been fraught with delays, technical
problems and procedural difficulties. Only 54 of 182 of these
cases have been adjudicated to date. Where the farmers have
prevailed the government is challenging the arbitrators'
decisions and ultimate payments to farmers will be years away.
There remain farmers who did not get full debt relief under
the settlement, even though a previous act of discrimination
may impede their ability to pay subsequent debt. They should
receive full payment.
Finally we note that injunctive relief provided in the settlement
has not been clearly translated in Federal regulations and actual
practice at county level FSA offices. A number of farmers have reported
to me that ``they were laughed at'', ridiculed, or told ``no such
benefit existed'' when they attempted to secure this most important
forward-looking benefit of the settlement at the local FSA office.
The Federation is working with a large group of these farmers, who
are seeking to exercise their injunctive relief benefits and not
receiving support from the government's representatives at the local
level. This is also part of a general pattern of continuing
discrimination and retaliation against Black farmers who participated
in the lawsuit. Moreover, the injunctive relief requested and provided
fails to address the many changes USDA still needs to make to prevent
future problems for recurring.
II. Removing the Need for Litigation Against USDA
The United States Department of Agriculture, and in particular, the
Farm Services Agency and its predecessor agencies, have been
responsible for discrimination and neglect that to date has cost the
U.S. taxpayers more than $700 million. Other class action lawsuits by
the Hispanic, Native American and Women producers, in addition to many
more employee lawsuits, will cost the taxpayer still more.
Instead of acting to remove the vestiges of discrimination and
prevent it from happening again, USDA has chosen to deny, in court and
in settlements, that it has discriminated. The fact is that the
Department and its agencies continue to discriminate. In the next
section of my testimony, I will discuss what the department could do if
it truly wanted to assure fair service to farmers.
In the 2002 Farm Bill, with the support of the House and Senate
Agriculture Committees, and on the full House and Senate, Congress took
additional steps to begin making the structural changes that are
necessary. We worked closely with you on these changes:
b A new post for an Assistant Secretary for Civil Rights, who will
report directly to the Secretary, was created, although it has
not yet been established or filled.
b The authority for the Minority Farm Outreach and Technical
Assistance Program was expanded to allow more coordination
among agencies, and eligible participants were more clearly
defined. The funding authority was expanded from $10 million to
$25 million.
b USDA is required to publicly report to the county level the
participate rate of producers in every program serving farmers.
These participation rates will be detailed by race, ethnicity
and gender. The Secretary must report changes in participation
to Congress after each Census of Agriculture.
b The Secretary is required to establish uniform election procedures
for FSA County Committee elections and to publicly report
participation data and results by race, ethnicity and gender.
Organizations representing minority producers are authorized to
nominate eligible producers to stand for elections. Ballot
counting must be open to the public and ballots must be opened
and counted at that time only.
b Budget authority for minority serving institutions was increased,
as was authority for the Extension Indian Reservation Program.
b FSA Loan Eligibility was restored to producers who received debt
forgiveness because of a natural disaster or emergency, and any
action provided as part of a resolution of a discrimination
complaint was excluded from the definition of debt forgiveness.
We urge Congress to fulfill its oversight authority by assuring all
of these provisions are quickly implemented and the results regularly
reviewed. These measures alone, however, are insufficient to root out
discrimination and prevent future lawsuits. We also urge you to take
notice of additional problems and recommendations offered today,
including those noted below.
A. Invest in Collaborative Outreach
By the time all the lawsuits are settled, the cost to taxpayers may
exceed $1 billion. These settlement costs do not include the many
losses to African American, Asian, Hispanic and American Indian
producers who lost their lands and livelihood unjustly with no
compensation. For example, in 1997, our Rural Coalition Board member
Greg Smitman, now the former Executive Director of the Intertribal
Agriculture Council, detailed to the Civil Rights Action team how farm
foreclosures accounted for the greatest loss of land from Indian
Reservations. Nor do these estimates include the cost of the lost
opportunity for hundreds of people of color who seek access to the
land, but who for many reasons are excluded and denied.
For many years, we in the minority farm community have together
sought relative minor investments, totaling in the tens of millions of
dollars, to secure effective outreach and equitable access to programs.
Had Congress provided since the 1990 Farm Bill the full $10 million
then authorized each year for the Section 2501 Minority Farm Outreach
and Technical Assistance Program, we would now have more farmers on the
land. This program and others that serve minority producers remain an
afterthought rather than a fundamental priority.
We urge Congress and especially this Committee to invest in equity
and to make the following programs a priority:
The Minority Farm Registry--An investment of around $1 million a
year would allow full implementation of the minority farm registry,
which I will discuss further later in this statement. The Registry, as
recommended in the Civil Rights Action Team Report as well as the
report of the USDA Commission on Small Farms, has been approved by the
Office of Management and Budget. Its implementation remains bogged down
in budgetary negotiations in USDA. This impasse should be solved
immediately.
The Extension Indian Reservation Program and Consolidated USDA
Offices on Indian Reservations--Cooperative Extension serves virtually
all counties in the United States, including urban counties. However,
Indian Reservations have long been excluded unless they pay for
services. In 1990, the Extension Indian Reservation Program was
established, and funds provided to extend Extension Services to some
Indian Reservations. In the 2002 Farm Bill, the spending limit on this
program was removed. However, a serious inequity will remain until this
program is made mandatory and until services are extended to all Indian
Reservations that request services. Likewise, USDA agencies cover the
cost of running their offices in virtually all farm counties in the
United States. But authorization language passed in 1990 for
consolidated offices on Indian Reservations requires the Tribe to pay
for these offices. This barrier should be removed, and USDA should
cover the costs of these offices.
Equitable Funding for Minority Serving Educational Institutions--We
have supported over the years many initiatives, including one awaiting
floor action in the House of Representatives, to make more equitable
and sufficient the support for minority serving institutions, included
the 1890 Universities, the 194 Indian Tribal Colleges and Hispanic
Serving Institutions. Adequate funding for these institutions is
essential, and a matter of justice. Once again, the additional $20-$30
million required is a small investment compared to the costs of
litigation and continued injustice.
Minority Farm Outreach and Technical Assistance--(See Section E for
a fuller discussion of the accomplishments of this program) The new
farm bill has gone into effect, with new programs and program
requirements. Without technical assistance, minority producers will
once again be excluded from the benefits of these programs. At a time
the Minority Farm Outreach and Technical Assistance is more necessary
than ever, the Administration has yet again relocated the program. The
$3 million Congress provided for FY 2002 has not been expended, and
existing contracts for outreach will expire at the end of this month.
The Administration has expressed some willingness to move towards 3
year contracts under this grant round. However, moving towards a full
appropriation is essential to assure that this change does not
eliminate for several years some ongoing programs. More funding is also
needed for organizations who for many years have been working with
minority farmers but who have not yet received funds to provided
services similar to those available through current grantees. Likewise,
there is an urgent need for more funding to existing grantees that are
now unable to serve all the farmers in their region.
The Administration has been talking about combining FY 2002 and FY
2003 funds to assure a larger funding pool to make the transition to 3
year grants, which in each round will be funded in a single year
appropriation.
However, we now face an emergency situation. The FY 2003
Agriculture Appropriation remains stalled, and may not see action
before Congress recesses or adjourns. At present, the House Agriculture
Appropriations Committee provided an additional $5 million to raise FY
2003 expenditures to some $8 million for the coming fiscal year. An
amendment to supply a similar increase in the Senate is being drafted
whenever that bill comes to the floor.
This Committee should lead efforts in Congress to invest in the
handful of programs that can lay the groundwork for making USDA
programs and services more equitable. For less than $50 million in new
funds, Congress could accomplish all of the recommendations listed
below.
We recommend the following action if the FY 2003 Appropriation is
not passed before Congress recesses for the elections:
(1) Upon passage of whatever resolution that continues the operation
of the USDA, USDA be urged to take the current level of $3
million in FY 2003 funds and combine them with the $3
million carried over from FY 2002. These funds should be
used to continue existing Minority Farm Outreach Contracts
for the coming year.
(2) This Committee should support a floor amendment to the FY 2003
Agriculture Appropriations Bill when it is considered that
would increase total funding for FY 2003 to $25 million.
With the funds supplied beyond those included in any
continuing resolution, a second grant round for the
Minority Farm Outreach and Technical Assistance Program
should be completed before the end of FY 2003.
(3) The Committee should also support the floor amendment now being
drafted to expand funding for the 1890 Universities, the
1994 Land-Grant College, and eligible Hispanic Serving
Institutions by $5 million each and call upon the Senate to
provide similar action.
(4) The Committee should further support additional funding of at
least $5 million for the Extension Indian Reservation
Program in the coming year.
Additional Recommendations:
(5) In future years, this Committee should regularly request and
strongly that the Appropriations Committee supply the full
authorized level of $25 million. Alternately, the Committee
should make the program and the funds mandatory at a level
of at least $25 million, and a regular and critical
priority among farm programs.
(6) The provision in Section 2501 of the 1990 Farm Bill requiring
Tribes to provide office space for Consolidated Offices on
Indian Reservations should be removed. USDA agencies should
pay for these offices.
(7) Extension Indian Reservation Programs should be provided for all
Tribes who request them. The Committee should support
adequate funding to meet al[l] needs, or make the program
mandatory.
(8) This Committee should assure that adequate funds are allocated
for the implementation of the Minority Farm Registry.
B. Make Farm Programs More Equitable and Assure They Reach and Meet the
Needs of Minority and Other Small Farmers.
Before the implementation of the new farm bill, approximately 75%
of farm program benefits went to 10% of largest and most prosperous
farmers. The same was true of bailout funds and AMTA payments. However,
support for 10 acre intensive vegetable farmers who were equally
devastated should be equitable. Most such farmers have not, and in this
year will not, receive disaster payments. Crop insurance has also
failed to serve the ongoing and disaster needs of small-scale
producers, including the vast majority of minority farmers.
In recent years, we have often heard FSA farm program employees
lament the way lawsuits involving credit programs were unfairly giving
a negative view of farm and commodity programs. We maintain there was
nothing unfair about a perception that farmers were also unfairly
treated and excluded from commodity programs.
A legislative anomaly that waived the right of sovereign immunity
only under the Equal Credit Opportunity Act restricted the ability of
farmers to seek damages from USDA in other than credit programs. As the
1992 Program Participation data in the table below illustrates,
minority farmers had very low participation rates in commodity and
other farm programs. Their exclusion from these programs certainly
reduced their ability to secure credit and maintain viable operations.
Under the 1992 Corn Loan program, 99.88% of participants were
white. Only in the cotton program, where 4.64% of the participants were
African American, was participation even close to the proportion of
Black farmers. However, most participants in the cotton program are
concentrated in the Southeast region, where, according to 1992 ASCS
statistics, 7.52% percent of producers were African American.
In the Conservation Reserve Program, where counties had limited
amounts of funds to allocate among producers, participants in 1992 were
99.3% white. Of 22,368 participants, 96 were African American, 30
Hispanic and 24 American Indian. In Oklahoma, the state with the
largest number of American Indian producers, there were only three
American Indian participants in the 1992 CRP program.
1992 Program Participants, Selected Programs
Agriculture Conservation and Stabilization Service
(Compiled from data provided by ASCS to the Rural Coalition)
----------------------------------------------------------------------------------------------------------------
Asian Amer./ Amer. Ind./ Total
Year White Black Hispanic Pacific Isl. AK Native Minority Total All
----------------------------------------------------------------------------------------------------------------
Total Producers
----------------------------------------------------------------------------------------------------------------
# 7,392,430 202,969 64,893 7,478 82,534 357,874 7,750,304
% 95.38% 2.62% 0.84% 0.10% 1.06% 4.62%
----------------------------------------------------------------------------------------------------------------
Conservation Reserve Program
----------------------------------------------------------------------------------------------------------------
Midwest 11,964 10 1 2 5 18 11,982
Northeast 224 -- -- -- -- -- 224
Northwest 3,940 -- 2 2 16 20 3,960
Southeast 3,279 81 1 2 -- 84 3,363
Southwest 2,705 5 26 -- 3 34 2,739
# 22,112 96 30 6 24 156 22,268
% 99.30% 0.43% 0.13% 0.03% 0.11% 0.70%
----------------------------------------------------------------------------------------------------------------
Emergency Conservation Reserve Program
----------------------------------------------------------------------------------------------------------------
Midwest 1,549 -- -- -- -- -- 1,549
Northeast 52 -- 1 1 -- 2 54
Northwest 920 -- 1 1 19 21 941
Southeast 496 21 157 -- -- 178 674
Southwest 641 5 18 8 1 32 673
# 3,658 26 177 10 20 233 3,891
% 94.01% 0.67% 4.55% 0.26% 0.51% 5.99%
----------------------------------------------------------------------------------------------------------------
Adjusted for Puerto Rico
----------------------------------------------------------------------------------------------------------------
Puerto Rico 155
----------------------------------------------------------------------------------------------------------------
Other
----------------------------------------------------------------------------------------------------------------
# 3,658 26 22 10 20 78 3,736
% 97.91% 0.70% 0.59% 0.27% 0.54% 2.09%
----------------------------------------------------------------------------------------------------------------
Corn Farm and Warehouse Loan
Selected Regions
----------------------------------------------------------------------------------------------------------------
Northwest 25,833 -- 1 1 5 7 25,840
Southeast 3,600 97 -- -- 5 102 3,702
Southwest 2,695 -- 4 -- 2 6 2,701
----------------------------------------------------------------------------------------------------------------
Total Program (All Regions)
----------------------------------------------------------------------------------------------------------------
# 106,411 107 6 2 17 132 106,573
% 99.88% 0.10% 0.01% 0.00% 0.02% 0.12%
----------------------------------------------------------------------------------------------------------------
ASCS Upland Cotton Farm and Warehouse Loan
Total Program
----------------------------------------------------------------------------------------------------------------
# 32,306 1,576 89 8 8 1,681 33,987
% 95.05% 4.64% 0.26% 0.02% 0.02% 4.95%
----------------------------------------------------------------------------------------------------------------
The statistics in the table above were provided to the Rural
Coalition by then FSA Administrator Grant Buntrock. He routinely
provided these numbers with complete breakdowns by state and region
when we requested them. I am providing an expanded version of these
tables to you for the record. In them, you can also find state by state
breakdowns. However, since 1997, USDA has not supplied any data in any
usable form to help us monitor the need for outreach and the results.
The new farm bill provisions on Transparency and Accountability
would make the release of such data, down to the county level, routine.
It is our hope that USDA websites could include this data for every
county in the nation, for only at that level is it truly meaningful. In
the table above, for example, the relatively large participation of
Puerto Rican farmers in the 1992 CRP program is large enough to affect
the national level data on minority farm participation. However,
participation rates for other minority farmers remain very low when the
figures are adjusted.
This is not to say that better participation in Puerto Rico is not
important. It is to say that equitable participation everywhere is
essential, and it will take state and county level data to make sure
that is happening in Alabama and Mississippi and Georgia, and Montana
and Texas and California, etc.
The low participation of minority farmers in the 1992 CRP program
underscores the point that is raised in the testimony of Mr. Burkett.
Where programs are discretionary and supplied on a first-come, first-
served basis, the injustices of the county committee system we will
discuss below are underscored. In my home county in Alabama, for
example, over 99% of CRP payments go to white farmers even though the
vast majority of producers are African American.
Minority farmers are often the last to hear about programs and sign
up windows. When they do request applications, they are often told the
program is not for them, or else the applications are not yet
available. When they return weeks later, the applications are gone and
the funds already allocated to white farmers. The same problem exists
in the allocation of disaster aid.
USDA agencies in general could begin to cure this program and
initiate accountability by taking two important steps.
b If agencies are required to release county level data on
participation rates in each program, they will be more careful
in assuring that minority farmers hear about programs. If their
participation rates differ greatly from similar counties, the
USDA Civil Rights operation will have data that allows them to
prioritize where to investigate disparities.
b The other critical step that Congress should require of USDA is the
recommendation that Mr. Burkett makes to establish a ``request
for service'' receipt. Whenever any farmer requests an
application or service and he or she is not supplied it, USDA
agencies should be required to provide a receipt that details
the name of the farmer, what was requested, why it was not
provided, and what action is recommended. A copy should be
given to the farmer, and one maintained in the office. In this
way, data would exist that could also make evident any
differences in service provided to minority and other farmers.
Forest Service and NRCS and other conservation similarly better
serve largely non-minority producers. FAS programs not designated for
small farmers. Credit programs need vast improvements. Rural
cooperative programs should better serve minority producers throughout
the nation. Congress should highlight equity issues as it reviews these
programs, particularly but not only before reauthorization.
b To understand the specific problems in these programs, there must
be funding for research conducted with the community based
organizations and educational institutions that know how to
reach minority producers.
In Appendix A, we have provided a copy of the testimony provided
earlier this year to the House Agriculture Committee Subcommittee on
General Farm Commodities and Risk Management. In this testimony, we
share results from research the Rural Coalition conducted in
cooperation with the Missouri Action Research Connection, based in the
University of Missouri Department of Rural Sociology. The findings of
this research, supported by the USDA Risk Management Agency and focused
on largely minority farmers, shows very low participation in program
crops. Of the farmers surveyed, over 30% had been denied a loan by FSA.
We also found that less than 20% of the farmers had used crop
insurance. Many farmers did not know where to find crop insurance. If
they did, often the products were unsuitable for their diverse farming
operations. In cooperation with RMA, we are working on a new project to
learn what kinds of insurance of all types minority farm families use,
and where they purchase it. We will also look at what types of crop
insurance products minority farmers may find worth the price.
We encourage the Agriculture Committee to continue its oversight on
risk management and crop insurance. We would further note that where an
agency, such as Risk Management Agency, makes a commitment to provide
resources and work with community based groups, there is a much greater
chance that gaps in services can be identified and methods to remediate
them can be derived without the need for litigation.
b We urge this subcommittee to focus on whether or not current
programs and insurance products have the potential to serve
minority and other small farmers.
b Congress should also monitor the role of crop insurance companies
to assure that they make a more concerted investment and effort
to work with community based groups and educational
institutions in a meaningful way to identify and remedy gaps in
service to minority producers.
Transparency and accountability are essential if Congress and the
public are to have the tools to improve how USDA conducts business.
b The Administration should report fully to Congress on the
implementation of the requirements of the farm bill, Section
10708 on Transparency and Accountability for Socially
Disadvantaged Farmers and Ranchers. According to this
requirement, the participation rates of minority farmers in all
of USDA's farm, credit, conservation programs should be
publicly disclosed on an annual basis to the county level.
Finally, we note that USDA has failed to provide programs and
services that meet the needs of small producers and diversified
operations. Congress and the Administration should work with groups
experiences in serving these populations to invite dialogue and
specific program proposals on how the needs of small farmers should be
addressed in the next farm bill. We will discuss this topic further in
a future section of this testimony.
C. FSA County Committees and Transparency and Accountability
The existing FSA county committee system must be substantively
reformed to assure it provides fair delivery of services everywhere, or
else it should be eliminated. Only when FSA discloses participation
data as well as information on the cost of operating this system, can
Congress and the public begin to assess if the funds expended are a
good use of Federal dollars to accomplish the work the committees are
supposed to accomplish.
It is the opinion of most minority and limited resource farmers
that they will not be fairly served through the existing system. We
believe it is also of paramount importance that the election process be
revised and fully monitored to reflect completely the spirit of the
Voting Rights Act and other civil rights laws with respect to minority
participation.
Below and in Appendix B, is a sampling of data that would be
available if the new county committee election data disclosure
requirements in the 2002 Farm Bill were implement. Data shown below are
incomplete; a FOIA request for the complete data for every county and
state sent by the Rural Coalition to USDA in December 1998 has never
been answered.
Data on FSA County Committees
(See Appendix B for more information)
The litigation of the past decade has held USDA liable for
its many failings in providing service to farmers. Minority
farm loss in previous decades progressed at a rate more than
three times that of other farmers. Between 1987 and 1997, an
additional 20% of African American farms were lost.
Hispanic farmers remain one of the largest new group of
entrants to agriculture, increasing from 17,476 in 1987 to
27,717 in 1997.
Figures compiled for the Intertribal Agriculture Council
estimates that FSA eligible voter lists underrepresented the
number of Indian producers by 80% in the ten largest states.
The County Committee system was devised in the 1930's as a
way to involve farmers in managing USDA programs and services.
The democratic model intended has often instead served as a
barrier to service for farmers in some areas. The fact that
nothing has been done to correct the problems in some regions
casts a negative light on the whole system.
The County Committee system is totally federally funded, and
as such, the Federal Government should assure that farmer-
elected county committees are chosen in fair elections and that
minority and women producers have a chance at assuring
equitable representation.
According to information provided to Rural Coalition by Farm
Services Agency, of 8,378 elected FSA County committee members
elected in 1996, only 20 were African American, 33 American
Indian, and 50 Hispanic.
Where county committees have not been successful, the result
has been costly lawsuits, and substantial increases in the rate
of minority and small farm land loss. Inconsistencies must be
addressed in order to maintain the integrity of local
participation and decision-making procedures of USDA.
Many county committee election ballots are disqualified (up
to 25% in some places) but FSA has not released the data it
collected in 1997 on disqualified ballots.
Inadequate participation of minority, socially disadvantaged
and other small farmers and rancher in county committees
elections has contributed to the widely variable service
provided to these producers in many counties. Election
procedures must be consistent and public information available
in order to ensure that all county committees operate in an
equitable manner.
In a number of places, groups have found that ballots are
opened as they arrive, with an informal count begun. This
procedure leaves open the possibility that if the numbers are
not as anticipated, committee members or staff can go out and
selectively seek additional ballots from others who have not
voted yet. New Public Disclosure for County Committee Elections
provisions passed in the 2002 Farm Bill require that ballots be
opened and counted at the same time and this counting be
announced and open to observer. Implementation of Section 10708
of the farm bill should help cure the previous problems.
We have recounted one specific instance in the 1990's of an
election overturned in Georgia when a Black farmer won a second term on
the committee. The results were thrown out on a technicality, and when
the election was redone, more absentee landowner ballots were cast. The
Black farmer lost by a handful of votes.
There are wide discrepancies between the number of farmers
and the number of eligible voters on FSA lists, with wide
regional and state discrepancies. In New Jersey there was one
eligible voter for every farmer; in NC the ratio was six
eligible voters for every farmer. (See Appendix B, Table 1)
In 1997, there were:
5,728,024 eligible voters for farmer elected county
committees compared to 1,911,859 farmers.
About 17.6%, or 382,725 of these eligible voters cast
ballots at the following rates:
17.7% of white farmers
10.8% of African American Farmers
28.1% of Asian/Pacific Islander Farmers
7.0 % of American Indian/Alaska Native Farmers (Other
statistics indicate
that FSA figures undercount American Indian producers by at
least 80%)
In Wayne County, North Carolina, there were 902 farms and
6079 eligible voters. (See Appendix B, Table 2).
An election in NM showed that only 84 votes were cast, with
the winner receiving only 25 votes. In this county with more
than 3,500 eligible voters, just 25 farmers cast votes for a
county committee member to hold a 3 year seat.
Minority Farm Representation on County Committees
Some data from USDA on the 1996 and 1997 elections:
In Alabama, one of 189 county committee members, or 0.53%,
were African American.
In NC, 2 of 273, or 0.73%, were African American.
In South Carolina, 2 of 121, or 1.65%, were African
American.
In Massachusetts, 2 of 35 committee members, or 5.71%, were
African American.
USDA has since 1997 stopped releasing comprehensive data on
county committee composition and election participation instead
releasing reports showing an aggregated and meaningless 30%
increase in minority county committee membership, from about
200 and some to 300.
In outreach trainings the Rural Coalition put together in 1996 and
1997 with support from and in collaboration with the FSA Outreach
Office, the 40 representatives of community-based organizations present
articulated unanimously the lack of confidence minority producers have
in the county committee system and in the willingness of FSA to serve
them at all. However, the groups conducted outreach following the event
that helped producers better understand the role of county committees
and enabled them to increase participation.
Building a new climate of trust and confidence, redressing these
concerns, and assuring fair participation in USDA programs will take
time. While these changes are made, outreach programs and collaboration
such as that noted above are essential to assure underserved producers
know how to access urgently needed the services of FSA and other
programs.
Our recommendations are as follows:
b Outreach funds in all programs are essential to provide the
assistance necessary now to help minority farmers. We urge
Congress to supply adequate funds for outreach to FSA, RMA,
NRCS and other programs to reach minority producers and supply
adequate and coordinated outreach that supplements the basic
outreach structure supported by the Minority Farm Outreach
Program.
b Congress should monitor closely the Secretary's plans and progress
relative to the implementation of Section 10708 of the farm
bill. In particular, Congress should make sure the new county
committee election procedures are implemented in time for the
2002 County Committee elections, and that within 90 days of the
election the Secretary conducts an analysis to determine if
more action is needed to assure fair representation. The
results of this analysis should be reviewed by congress.
b Election participation data should also be disclosed each year to
the public on existing FSA websites for the county, state and
national level. We would note that the Congressional Budget
office scored the cost of this amendment at zero because USDA
already collects the data required.
b Revised election procedures and disclosure requirements should also
be required by Congress with respect to all other Boards and
Committees that are associated with USDA programs, including
Soil Conservation Districts, Extension and elsewhere.
b In the case of County Committees, the Department must have in place
responsible and accountable staff members who are Federal
employees. New recruitment should emphasize diversity in the
delivery workplace.
b Congress should continue oversight to assure the county committee
system works fairly for all producers. If results are not
achieved, the system should be abolished.
D. The Need for a Minority Farm Registry
The Minority Farm Registry is an essential tool to reach and serve
minority farmers and to monitor the progress of USDA agencies in
reaching these farmers. It should be implemented immediately with the
support from multiple USDA agencies under the existing missions of
their programs.
The Registry promised by the Department and approved in 2000 by the
Office of Management and Budget has not yet been officially instituted.
Nor has its use as a vehicle to collect baseline data and monitor
progress in serving minority farmers been articulated.
The registry implements recommendation #28 of the CRAT report. We
fear the approved program has fallen victim to bureaucratic bungling
within the department. Apparently, agencies cannot agree on where funds
should come for the implementation of the registry. Because the
registry would help many agencies better deliver and accomplish the
purposes of their program, we believe multi-agency support should be
provided, and the funds for data collection should not be supplied from
the scarce resources of the Section 2501 minority farm outreach
program.
As the registry was being developed, we worked actively with staff
members of several agencies to develop an outreach plan for the
registry. It is critical that USDA work in partnership with
organizations that have credibility with minority producers if the
registry is to be used and USDA to develop new credibility.
The agencies have reported the process is stalled over the
mechanisms forfunding the registry. We recommend that
b Congress urge the Secretary to resolve the bureaucratic issues,
establish the registry with appropriate support and
collaboration from those agencies which deliver services to
farmers, and work as proposed in partnership with community
based groups to educate minority farmers about the registry,
its purposes and use.
E. Integration of Outreach Efforts and the Need for a Coordinated Small
Farms Program or Agency
USDA and many of its agencies have failed to work appropriately and
strategically with the groups that are the legitimate representatives
of its underserved constituents. It has missed the opportunity to
create partnerships with them to assure fair and equitable service is
provided in all USDA programs. As the information provided later in
this section illustrates, the Minority Farm Outreach and Technical
Assistance Program has created results.
In addition, the partnerships in research and outreach with Risk
Management Agency, NRCS and FSA cited elsewhere have similarly been
effective for USDA agencies and minority farmers alike.
This Committee is well aware that the groups appearing before you
today have all diligently represented the needs and interests of their
minority farm members. They have demonstrated their capacity to assist
the department and the Congress in identifying solutions to the
problems we have discussed today.
At the present moment, the Minority Farm Outreach Program is being
moved for the sixth time since 1990. Those of us who have helped create
and have long supported this program have not as a group been involved
in the decisions surrounding this program. From what we can understand,
the grant-making functions are being separated from the program
functions as defined in the new farm bill.
In the 2002 Farm Bill, Congress expanded authority for the Minority
Farm Outreach and Technical Assistance Program as follows:
The law defines in Section 10707(b)(a)(1) that ``the Secretary of
Agriculture shall carry out an outreach and technical assistance
program to encourage and assist socially disadvantaged farmers in
owning and operating farms and ranches and participating equitably in
the full range of agricultural programs offered by the Department.''
This program ``shall enhance coordination of the outreach, technical
assistance and education efforts authorized under various agriculture
programs . . .''
We believe that in addition to the outreach functions already
supported under this program, that the Minority Farm Registry belongs
here as well as a critical tool to assist these farmers in owing and
operating farms.
One, but only one, function of this program is to ``enter into
grants and contracts with the eligible entities to provide information
and technical assistance.'' The law makes clear that this authority is
in addition to any other authority provided in the farm bill or
elsewhere. In addition to the funds appropriate, any other agency of
the department is authorized to contribute funds to participate in any
grant contract or agreement if the objectives of that contract further
the authorized programs of the contributing agency.
In the past year, the community based organizations and educational
institutions who that designated as eligible entities under this law
have collaborated more closely than ever to secure a more coordinated
program. It is our common hope that the myriad outreach and small farm
functions of the department can over time, and in consultation with
this important group of stakeholders, be more strategically integrated
and coordinated.
We believe strongly that these functions should be separate from
those of the new Assistant Secretary for Civil Rights whose function is
to assure that all programs are fairly delivered according to the law.
The farmers we serve strongly support the Minority Farm Outreach
Program. However, as we prepared for the farm bill, our members also
strongly supported a new program to serve the diverse needs of small
farmers. Many also suggested a separate agency or program to deliver
these services.
Minority and small farmers need a real home at USDA. They need
programs to serve their unique needs and special value to rural
communities and our society. These groups should not be excluded, but
instead should be involved as a group as the Secretary makes decisions
that are critical not only to the grant-making portion of the Outreach
Program but to the eventual coordination and integration of outreach,
program and services that are essential to finally assuring a future
for minority farmers.
In the following section, we provide more information on what the
program is now accomplishing.
The Minority Farm Outreach and Technical Assistance Program
The Minority Farm Outreach and Technical Assistance Program helps
minority and other small farmers gain access to USDA's credit,
commodity, conservation and other programs. Under this program,
community-based organizations and educational institutions with long
experience in serving minority farmers provide them with training in
farm management, production, marketing and other key assistance
critical to accessing USDA programs and managing viable farm
operations.
The Facts:
Minority farmers receive fewer farm program payments, fewer
and lower-valued loans, and less outreach and training than do
their non-minority peers.
These disparities have led to conditions whereby minority
producers are losing land at a rate three times that of other
producers.
Many minority producers, especially new-entry farmers, have
little knowledge of or access to USDA programs that should be
available to help them.
The Minority Farm Outreach Program is the only program
created by Congress to address the disparate land loss by
minority producers by providing them with meaningful
assistance.
Minority farmers who have received services from the
educational institutions or community-based organizations
supported by this program have higher rates of participation
and understanding of USDA programs.
Since its inception this program has been continually funded
far below its authorized level of $10 million. It has never
been funded at more than $3.2 million.
Increased funding is needed for this program to reach the
countless number of farmers and ranchers who are in need of
support.
The Outreach program serves minority communities that have been
historically underserved and are in vital need of services. The program
has provided outreach to more than 100,000 rural constituents and has
been an invaluable resource for the more than 400 counties where it has
been implemented, among them some of the poorest in the country, where
minority and under-served small and family farmers are concentrated.
Technical and outreach staff understand their clients' needs. This
program offers minority farmers direct technical assistance and
training on farm management, production, and marketing assistance, and
cooperative and credit union development; from organizations that have
experience working with minority producers and have established
themselves as members of the community.
The Minority Outreach Program WORKS! Communities where this program
operates have seen a dramatic increase in the number of minority
producers participating in farm programs and staying on the land.
Producers in communities with no outreach program have little to no
knowledge of USDA programs. Additional funds are needed to extend
Outreach services to more eligible organizations to reach more
communities and farmers where resources have never been allocated.
In order to adequately meet unserved needs, Congress expanded
funding authority for the Minority Farm Outreach Program to $25 million
in the 2002 Farm Bill. We urge that the appropriation for the program
be expanded to $25 million for FY 2003.
Addressing the Myths about the Minority Farm Outreach Program
Myth: All Farmers Have Equal Access to USDA Programs
Fact: The majority of USDA farm program funds benefit the largest
farmers. Without technical assistance through the Minority Farm
Outreach and Technical Assistance Program, there is little chance many
minority farmers will know about, qualify for, or benefit from USDA
farm programs.
Fact: In 2001, the scant $3 million provided by Congress helped
USDA support 32 outreach programs in 23 states and Puerto Rico,
reaching hundreds of minority farmers and ranchers. A funding increase
to $25 million would allow the expansion of current programs to reach
more farmers, and would allow more eligible institutions with
demonstrated experience to reach the thousands more eligible farmers
they seek to serve.
Fact: Under the new farm payment limitations in the 2002 Farm Bill,
the same $25 million that could reach thousands of minority farmers
would reach only about 50 of the largest producers.
Myth: The Program is Just a Subsidy for the 1890 Land-Grant
Universities
Fact: Hundreds of African American and other farmers receive
critical services under this program through the 1890 Land-Grant
Institutions. In addition, the program serves a diverse group of
African-American, Latino, Asian and Native American community-based
organizations that have assisted socially disadvantaged producers for
many years, and in some cases, decades without Federal support. These
groups have provided services substantially similar to those provided
with Federal support in other outreach and extension programs for
mainstream farmers.
Fact: In 2001, an improved outreach and peer review process
resulted in grants to more than a dozen CBO's and Tribal and Community
College, and six programs west of the Mississippi.
Myth: The Program Has Not Produced Results
``Since 1995, we have helped African-American farmers save
more than 4,000 acres of land valued at more than $3 million,
and helped to secure financing for the purchase of more than
1600 acres, valued at more than $1 million. In 2000 our
outreach efforts helped 192 farmers participate in USDA
programs. In 2000 87% of our farmers grew alternative crops,
92% had developed record keeping systems, and 8% were using
computers. Average gross income of our farmers has increased by
$15,000 since1995. Only 52% continue to depend on off-farm
income, down from 64%.''
Jerry Pennick, Federation of Southern Cooperatives/Land Assistance
Fund.
``Since 1998 we have worked with over 150 new immigrant
farmers to help them adapt their agrarian skills to provide
food for their families as well as to provide an avenue to
self-sufficiency. The New Immigrant Agriculture Project (NIAP)
has helped add over 40 new immigrant farmers onto the FSA
records and helped the first Hmong farmer in Minnesota to own
land get an FSA farm loan and purchase 56 acres.''
Melissa MacKimm--Minnesota Food Association.
``The Center for Latino Farmers' primary focus is on farm
worker to farm owner initiatives. The Project is providing
outreach and assistance to 150 Latino farmers to increase their
access to USDA programs, develop the farmers' understanding of
computers and train them in how to set up their own
computerized accounting systems.''
Luz Bazan Gutierrez, Rural Community Development Resources, Yakima,
Washington.
``H.A.C. is the first CBO of its kind that focuses on
economic development in the Hmong immigrants in California's
central valley. HAC helped establish the Hmong American Farming
Cooperative and is working with 100 farmers to cooperatively
market specialty Asian vegetables. Our Small Farm Resource and
Training Center offers producers one-stop assistance in farm
planning, using new technology in their operations, and in
navigating USDA programs and services, as well as training and
assistance in their native language.''
Chukou Thao,--Hmong American Community, Inc., Fresno, CA.
Discrimination and neglect still exist, and the community groups
working in the field are among the best equipped to cooperate with the
department in bringing about a new responsiveness and spirit of service
in the delivery of USDA programs.
b It is our hope that this Committee will recommend to the Secretary
that the groups represented here and their counterparts in
educational institutions and community based organization who
work with minority farmers be included as a group in a dialogue
about how an integrated outreach and technical assistance
program could be housed and operated within USDA.
b We further hope the Committee will hold hearings to hear our
proposals for programs to serve small farmers so that pilot
efforts may be instituted and evaluated well in advance of the
next farm bill.
F. The Need for the Establishment of the Assistant Secretary for Civil
Rights and the Institution of Real Accountability Throughout
USDA
The USDA Leadership has failed to (a) redress and remove vestiges
of past discrimination, (b) create a system which rewards or does not
undercut or punish those agencies and individuals who are making
changes, and (c) hold top level managers accountable for the
performance of their subordinates.
To those of us who have done all we can to work with USDA to
improve services, it is no surprise that structural change has not
occurred.
The same people who have created discrimination or allowed
discrimination to continue among their subordinates remain in place at
USDA. At the same time, employees with the courage to attempt to make
change have either been removed or are penalized for what they do.
After $700 million has been paid in settlements under the Pigford
v. Glickman Consent decree, we are astounded that no high level
managers in FSA credit have been retired or replaced. We have seen no
data that shows managers, or USDA employees, have been reprimanded and
removed. No retired employees have had their pension benefits re-
evaluated. The failure to demonstrate that discrimination has
consequences in fact constitutes permission to employees to continue
business as usual.
USDA a week ago put out a new press release that among other things
announced still more civil rights training for its employees. USDA has
repeatedly instituted Civil Rights training for employees since 1997.
If the same employees who have been trained before are still not
delivering services adequately, it is long past time that they be
evaluated and removed!
Employees who have discriminated are retiring with pension benefits
while settlements for farmers are denied or delayed. In the county
where the Federation of Southern Cooperatives has its training center,
I know 100 people who were discriminated against by the County
Supervisor. His actions directly cost the more than $5 million in
settlements that have been paid out to these farmers. The consequences
of his actions: none. He has retired with full benefits at the expense
of the taxpayer.
For some years, USDA employees have reported that a high level
manager who for an extended period of time had a hangman's noose in his
office and who displayed this noose to at least one African American
employee is still in his position. It does not increase confidence that
this individual is the same person who for years has been in charge of
loan servicing for FSA. Consider, however, the message transmitted to
field personnel when this individual remains in place.
Worse still is the fact that his former supervisor, Lou Ann Kling,
who has for many years been one of the most ardent supporters of
minority and other small farmers, was removed for her position as the
head of farm credit at the same time she tried to hold the manager with
the noose accountable. She was transferred to the FSA Outreach Office.
Many other people whom we respect and who have done their utmost to
support equity and accountability at USDA have similarly been rewarded
with demotions or lack of promotions. We note particularly that Pearlie
Reed, former chief of the Natural Resources and Conservation Service,
has been moved to a post of regional conservationist for the west. The
post of NRCS chief has been made political once more, which is the
prerogative of this Administration. However, we would note that at the
same time, the post of Administrator of Farm Services Agency has in
recent years been returned to a career position, now filled by Mr.
James Little.
Throughout the whole county committee system, and in headquarters
as well are people who have been a part of discriminatory practices.
While the civil rights program complaints system at has failed on
many levels, the most egregious is that it has not been insulated from
the agencies being investigated. Farm Services and other agencies
remain far too involved in the process of reviewing complaints. Quite
apart from the skills of the individual involved, it does not increase
confidence in the area of program complaints that the former Director
of Civil Rights for Farm Services Agency is now the Director of the
Department's Office of Civil Rights. USDA has simply not yet earned a
reputation for fairness in this area necessary to avoid the suspicion
that the fox has been assigned to guard the chicken coop.
Discrimination and disparity in service has not stopped at USDA.
However, farmers are so frustrated with the complaints process that
they fail to file complaints until situations deteriorate beyond easy
rectification. The failure of USDA to get on with the business of
processing complaints, rectifying injustice, and fixing problems with
service delivery to prevent future problems is grossly unfair not only
to farmers and employees who try to do their jobs well, it also risks
new liability and taxpayer expense to solve problems that should no
longer be occurring.
USDA, to our knowledge, still lacks any comprehensive and
consistent monitoring and compliance review system. Even data collected
on a regular basis that would allow USDA officials to monitor
performance of agencies and employees at the county level are not
reviewed from the framework of preventing disparate treatment. It is
not clear that these factors are considered specifically in monitoring
the performance of employees.
As a result, complaints are the only evidence USDA has to take
corrective action. Were program complaints reviewed in a consistent and
unbiased manner, completely insulated from the agencies against whom
the complaints are filed, USDA Office of Civil Rights could focus more
on the accountability mechanisms and corrective actions that are
essential to instituting a fair system of service delivery.
The failure to adequately and fairly address complaints only delays
the time it will take to end the history of past discrimination by
USDA. We recommend that the complaint resolution process be divorced
from any USDA staff involvement. Any employee who meddles should be
dismissed and be made liable as a criminal offense for their actions.
Congress has responded to these concerns by establishing an
Assistant Secretary for Civil Rights that reports directly to the
Secretary.
b We recommend that Congress urge the Secretary to move rapidly to
create this post and consolidate all Civil Rights functions
there.
b Congress should also urge the Secretary to announce a well-
qualified and audacious candidate for this position and a plan
for structuring this new office.
b The Assistant Secretary for Civil Rights should also assure that
public disclosure is instituted to show action taken to hold
employees accountable for discrimination. Reports should
summarize the types of action taken (reprimand, removal, etc.),
categorized by agency, state, and grade level.
Conclusion
We appreciate this opportunity to share our insights and
recommendations with you. We are most willing to answer now or in the
future any questions you may have or to offer any assistance we are
able to the Committee or to the Secretary to make USDA services more
equitable.
Appendix A
The Implementation of Title I of the Agricultural Risk Protection Act
with Respect to the Needs of Socially Disadvantaged and Other
Limited Resource Producers
Statement of John Green, M.S. on behalf of Rural Coalition and Missouri
Action Research Connection (MARC) to the U.S. House of
Representatives Committee on Agriculture Subcommittee on
General Farm Commodities and Risk Management
February 13, 2002
Executive Summary. The Rural Coalition, a Washington D.C.-based
coalition with more than 80 community-based member groups serving small
farmers, and the Missouri Action Research Connection (MARC) at the
University of Missouri-Columbia conducted thirteen focus groups with
small, limited resource and minority farmers in the United States to
obtain their input on agricultural programs and services.* As part of
this effort, participants were specifically asked to discuss crop
insurance. Among the culturally and geographically diverse focus
groups:
---------------------------------------------------------------------------
* This research was conducted by the Rural Coalition and Missouri
Action Resource Connection with support from the USDA Risk Management
Agency, Oxfam America, Jessie Smith Noyes Foundation, Presbyterian
Hunger Program, and additional support from the Department of Rural
Sociology in the College of Agriculture, Food and Natural Resources,
University of Missouri-Columbia. The findings may not represent the
policies or positions of the funding agencies. For the complete report,
contact John Green, Missouri Action Research Connection, Department of
Rural Sociology, 203 B Sociology Bldg., University of Missouri,
Columbia, MO 65211, phone [Redacted], email [Redacted].
Participants indicated the least familiarity with and
moderately low use of crop insurance, relative to other
---------------------------------------------------------------------------
agricultural programs and services.
Participants who reported not using crop insurance argued
that they did not know how, it was too expensive, their farm
was not large enough and/or that the produce they grow/
livestock they raise are not covered.
In not a single group did participants mention crop
insurance without facilitator prompting in discussions of who
and/or what organizations and agencies are helpful or not
helpful to their farming enterprise.
Participants generally supported crop insurance and the need
for disaster assistance and risk protection in concept, but
noted the need for change.
Introduction to the Focus Group Project. In order to obtain program
input from small, limited resource and minority farmers, focus groups
were collaboratively conducted by the Rural Coalition and MARC.
Thirteen focus groups involving a total of 130 participants were held
during 2001 in California, Maine, Mississippi, New Mexico, North
Carolina, South Carolina, Vermont and Washington. Topics covered were
farmers' hopes for the future, the challenges they face, and their
recommendations for future agricultural programs. Of particular
interest in these discussions were issues related to disaster
protection, risk management and crop insurance.
The participants in this research project represented a diverse
array of agricultural producers. Over \1/3\ of the participants were
women. Age was centered in the 44 to 59 years category. Concerning
race/ethnicity, the largest group of participants identified as Black/
African American, followed in prevalence by White/Euro American and
Hispanic/Latino. Other participants identified as Asian, specifically
Hmong, or American Indian. The largest percent of participants had
farms ranging in size from 10 to 49 acres (33.6 percent), followed by
those who had less than 10 acres (24.8 percent). Concerning farm sales
in 2000, over \1/4\ of the participants were in the $1,000 to $4,999
range, followed in frequency by those who reported over $50,000 in
sales (23.5 percent). There were a considerable number of participants,
18.6 percent, that reported farm sales less than $1,000, while a
combined 32.4 percent fell in one of the three categories ranging from
$5,000 to $50,000 in sales.
Farmers' Discussions of Crop Insurance. To begin, it is important
to note that many focus group participants were generally unfamiliar
with government agricultural agencies and programs. For example, there
were those who were unsure of the distinction between agencies and
specific programs, particularly after the 1994 USDA reorganization,
while others simply had little experience with them. Participants
attributed this lack of knowledge and contact as resulting from
inadequate outreach efforts to small, limited resource and minority
farmers on the part of agricultural agencies, or previous negative
experience with these or other USDA agencies.
In a survey of their knowledge of and participation in various USDA
programs and services, focus group members indicated the least
familiarity with crop insurance (43.6 percent) relative to other USDA
programs (see Table 1). In comparison, they indicated the most
familiarity with Cooperative Extension, Farm Services Agency (FSA) and
the Natural Resources Conservation Service (NRCS). However, there were
numerous instances where participants had not taken part in the
programs offered by these or any of the other agencies. Less than \1/2\
of participants who reported being familiar with crop insurance had
ever sought assistance, a significantly lower rate of engagement than
for the other programs and agencies discussed.
Table 1: Participant Familiarity with Crop Insurance in Comparison to Other Government Programs/Services from
Focus Group Survey
----------------------------------------------------------------------------------------------------------------
Aware of Program/Service Ever Sought Assistance *
Programs/Services ---------------------------------------------------------------
Frequency Percent Frequency Percent
----------------------------------------------------------------------------------------------------------------
Crop Insurance
Yes 41 43.6% 17 44.7%
No 53 56.4% 21 55.3%
FSA Credit Programs
Yes 62 62.0% 38 62.3%
No 38 38.0% 23 37.7%
FSA Farm and Disaster Programs
Yes 63 62.4% 42 67.7%
No 38 37.6% 20 32.3%
FSA County Committees
Yes 56 56.6% 36 67.9%
No 43 43.4% 17 32.1%
Natural Resource Conservation Service
Yes 62 62.0% 35 58.3%
No 38 38.0% 25 41.7%
Cooperative Extension Service
Yes 72 75.8% 55 84.6%
No 23 24.2% 10 15.4%
----------------------------------------------------------------------------------------------------------------
Source: Rural Coalition/MARC Focus Group Project, 2001.
* Question only asked of those who were aware of program/service.
Approximately 20 percent of focus group participants reported
actual participation in crop insurance (Table 2). In comparison, less
than \1/4\ of the participants had ever received an USDA loan, and over
30 percent reported having been denied such a loan. Thirty-two percent
of focus group participants indicated that they had ever received USDA
Disaster Assistance. Even fewer participated in annual commodity
programs (15.3 percent). Participation in conservation programs was
higher at 27.4 percent.
While most groups emphasized the importance of disaster assistance,
the reasons cited in the survey for not participating in crop insurance
included ``I don't know how'' and ``I do not have enough money.''
Others said that crop insurance is ``too costly'' and reported that
they ``don't have a large farm,'' that their ``level of production is
insufficient'' or that what they produce ``is not covered.'' Some of
these statements reflect a general misunderstanding of how crop
insurance programs operate, while others reflect problems with the
current structure of these programs.
Table 2: Participant Involvement in Crop Insurance in Comparison to
Other Government Programs/Services from Focus Group Survey
------------------------------------------------------------------------
Programs/Services Frequency Percent
------------------------------------------------------------------------
Participate in Crop Insurance
Yes 22 19.8%
No 89 80.2%
Ever Received an USDA Loan
Yes 28 24.3%
No 87 75.7%
Ever Been Denied an USDA Loan
Yes 33 30.3%
No 76 69.7%
Ever Received USDA Disaster Assistance
Yes 36 32.1%
No 76 67.9%
Participate in Annual Commodity Programs
Yes 17 15.3%
No 94 84.7%
Participate in Conservation Programs
Yes 31 27.4%
No 82 72.6%
------------------------------------------------------------------------
Source: Rural Coalition/MARC Focus Group Project, 2001.
When asked in the focus groups who and/or what organizations and
agencies are helpful or not helpful to their farming enterprise,
neither crop insurance nor crop insurance agents were mentioned by any
of the focus groups without facilitator prompting in discussions, and
few of the participants knew their crop insurance agent or where to
find him/her. In the end, focus group participants were generally
supportive of the ``idea'' of crop insurance, but they felt that
significant changes were needed to make it applicable to their farms.
Conclusion and Points to Consider. Based on the results taken from
this research and the outreach work undertaken by the Rural Coalition
more generally, there are a few points that should be considered in
review of crop insurance as it concerns small, limited resource and
minority farmers:
Information: These farmers often do not know what programs
and products are available, how to apply or who to contact.
Price: Participation in some programs may be prohibitively
expensive.
Limited Coverage: Many small farm products (especially
vegetables) are not covered.
Program Structure: Programs tend to be more responsive to
larger-scale producers and often do not meet the needs of
small, limited resource and minority producers.
Appendix B: County Committee and Eligible Voter Data
Table 1: Number and Ratio of FSA Eligible Voters Compared to Number of
Farmers, By State
------------------------------------------------------------------------
Number of
Number of Eligible Voters-- Ratio: Number of
State Farmers 1997 Farm Service Eligible Voters
Agriculture Agency 4/96 * to Number of
Census Farmers
------------------------------------------------------------------------
Alabama 41,384 167,794 4.05
Alaska 548 1,579 2.88
Arizona 6,135 30,563 4.98
Arkansas 45,142 143,247 3.17
California 74,126 97,276 1.31
Colorado 28,268 59,147 2.09
Connecticut 3,687 5,292 1.44
Delaware 2,460 7,594 3.09
Florida 34,799 63,633 1.83
Georgia 40,334 156,941 3.89
Hawaii 5,473 2,917 0.53
Idaho 22,314 56,106 2.51
Illinois 73,051 240,739 3.30
Indiana 57,916 194,145 3.35
Iowa 90,792 245,897 2.71
Kansas 61,593 208,485 3.38
Kentucky 82,273 302,567 3.68
Louisiana 23,823 116,732 4.90
Maine 5,810 15,296 2.63
Maryland 12,084 30,408 2.52
Massachusetts 5,574 11,036 1.98
Michigan 46,027 173,801 3.78
Minnesota 73,367 205,548 2.80
Mississippi 31,318 174,338 5.57
Missouri 98,860 236,865 2.40
Montana 24,279 94,345 3.89
Nebraska 51,454 160,626 3.12
Nevada 2,829 4,710 1.66
New Hampshire 2,937 4,336 1.48
New Jersey 9,101 9,082 1.00
New Mexico 14,094 40,039 2.84
New York 31,757 68,404 2.15
[North] Carolina 49,406 301,325 6.10
North Dakota 30,504 110,769 3.63
Ohio 68,591 217,684 3.17
Oklahoma 74,214 146,618 1.98
Oregon 34,030 48,059 1.41
Pennsylvania 45,457 118,536 2.61
Rhode Island 735 1,400 1.90
[South] Carolina 20,189 114,673 5.68
South Dakota 31,284 113,812 3.64
Tennessee 76,818 250,824 3.27
Texas 194,301 589,461 3.03
Utah 14,181 23,902 1.69
Vermont 5,828 12,043 2.07
Virginia 41,095 160,646 3.91
Washignton 29,011 61,458 2.12
West Virginia 17,772 46,929 2.64
Wisconsin 65,602 273,345 4.17
Wyoming 9,232 19,328 2.09
------------------------------------------------------
Total.......... 1,911,859 5,940,300 3.11
------------------------------------------------------------------------
* Last figures made public.
Figures in bold exceed the National Average.
Table 2: FSA Eligible Voter Numbers and Election Participation, Selected Counties, 1996
Eligible Voter Information by County for FSA Election Years 1996 Selected Counties (From County level FSA Forms
681) *
----------------------------------------------------------------------------------------------------------------
Eligible Voters Voters/Open LAA's Voter Partic.
--------------------------------------------------------------------------------
County Year of Total Total Minority Total Total Minority Total Minority
Elec. Farms --------------------------------------------------------------------------------
(#) (#) (%) (#) (#) (%) (#) (%) (#) (%)
----------------------------------------------------------------------------------------------------------------
Alabama
----------------------------------------------------------------------------------------------------------------
Autaga 95 1,875 315 17% 151 8% 14 4%
* Editor's
note: the
statement
submitted as
part of the
appendices
of the Rural
Coalition/
Coalicion
Rural for
the March
25, 2021
hearing is
incomplete
(it cuts off
part of the
original
document's
table).
Further
note: the
published
hearing,
Serial no.
107-23 does
not include
the cover
page, p. 1,
of this
testimony.
To aid in
clarity, the
table has
been
recreated,
in its
entirety,
pp. 182-184,
from the
previously
published
hearing. The
current
extant link
for an
electronic
copy is a
Digitized by
Google pdf
https://
books.google
.com/
books?id=Pzv
8-I5YZcoC.
96 1,935 308 16% 699 76 11% 47 7% 1 1%
97
Bullock 95 1,789 574 32%
96 1,789 574 32% 836 304 36% 92 11%
97
Butler 95 2,343 917 39% 309 13% 131 14%
96 2,343 917 39% 776 311 40% 90 12% 32 10%
97
Chilton 95 3,488 128 4% 101 3% 11 9%
96 3,127 127 4% 136 14 10% 61 45% 2 14%
97
Conecuh 95 2,231 1,022 46% 384 17% 178 17%
96 2,245 1,023 46% 826 374 45% 134 16% 61 16%
97
Dallas 95 3,632 1,247 34% 303 8% 31 2%
96 3,632 1,247 34% 1,035 251 24% 50 5% 18 7%
97
Greene 95 1,507 568 38% 525 35% 188 33%
96 690 334 48% 690 239 35% 334 48% 175 73%
97
Marengo 95 2,314 1,163 50% 287 12% 12%
96
97
Perry 95 1,794 691 39% 272 15%
96 754 219 29% 754 219 29% 104 14%
97
Sumter 95 1,625 572 35% 365 22% 100 17%
96
97
Wilcox 95 1,581 622 40% 364 23% 73 12%
96
97
----------------------------------------------------------------------------------------------------------------
California
----------------------------------------------------------------------------------------------------------------
Santa Cruz 95
96 344 58 17%
97
Monterey 95
96 1,531 101 7%
97
----------------------------------------------------------------------------------------------------------------
New Mexico
----------------------------------------------------------------------------------------------------------------
McKinely 94 3,371 3,168 94%
97 84
----------------------------------------------------------------------------------------------------------------
North Carolina
----------------------------------------------------------------------------------------------------------------
Lenoir 4,039 305 8% 1,008 113 11% 186 18% 26 23%
96 531
Wayne
96 902 6,079 749 12% 1,955 292 15% 231 12% 8 3%
----------------------------------------------------------------------------------------------------------------
South Carolina
----------------------------------------------------------------------------------------------------------------
Chas 95 955 86
96 850 95 11%
97
Clarendon 95 1,383 690 50% 136 10%
96 1,319 180 14%
97
Florence 95 4,096 1,803 44% 203 5%
96 4,199 268 6%
97
Horry 95 2,064 745 36% 338 16%
96 1,943 217 11%
97
Lee 95 777 319 41% 106 14%
96 833 121 15%
97
Sumter 95 1,217 526 43% 124 10%
96 1,247 172 14%
97
Williams 95 2,579 1,036 40% 209 8%
96 2,640 159 6%
----------------------------------------------------------------------------------------------------------------
Washington
----------------------------------------------------------------------------------------------------------------
Adams 95 2,851 13 0 0% 0
96 2,917 3 724 0 0% 0 0% 0
97
Chelon 95 1,397 449 32% 353 30%
96 1,411 474 34% 472 151 32% 79 10% 27 18%
97
Douglas 95 1,960 10 513 30% 0
96 1,989 8 579 4 160 10% 2 50%
97
Grant 95 4,048 78 2% 745 20% 13 17%
96 4,205 69 2% 1,224 37 3% 257 10% 8 22%
97
Okanagan 95 1,464 64 4% 277 20% 14 22%
96 1,457 63 4% 737 20 3% 205 14% 0 0%
97
Yakima 95 6,634 201 3% 752 11% 53 26%
96 6,585 311 5% 2,428 157 7% 325 5% 28 9%
----------------------------------------------------------------------------------------------------------------
Compiled by Rural Coalition.
2. Research Findings and Policy Recommendations
[1] John J. Green, PhD, ``Summary Results from The Financial
Training Project Assessment Survey: A Report to the Rural Coalition,''
Institute for Community-Based Research, Division of Social Sciences/
Center for Community and Economic Development, Delta State University,
February 2006.
[2] John J. Green, Lorette Picciano, Heather Fenney, et al., ``The
Insurance Needs of Traditionally-Underserved Farmers: Framework for a
Multi-Community Assessment,'' presented at the Annual Meeting of the
Rural Sociological Society, Montreal, Canada, July 2003.
[3] Oklahoma Black Historical Research Project, with Rural
Coalition, et al.,\1\ ``The 100 Summit Report: Addressing the Needs and
Concerns of the Underserved Minority Family Farming Community,`` 2017.
[Research Findings and Policy Recommendations 1]
Summary Results from the Financial Training Project Assessment Survey_A
Report to the Rural Coalition
John J. Green, Ph.D., Institute for Community-Based Research, Division
of Social Sciences/Center for Community and Economic Development, Delta
State University
February 2006
Introduction
Through applied research and input from partner organizations, the
Rural Coalition recognized a need for financial training that is
appropriate to the interests and concerns of small-scale, limited
resource and minority farmers. In collaboration with representatives
from several diverse community-based organizations, the RC worked to
develop a training program to improve the risk management strategies
and record keeping practices of their members and other farmers.
Following a participatory process of sharing and synthesis of best
practices, a training curriculum was designed and piloted. Starting in
fall 2004 and running through mid 2005, eight organizations conducted
training sessions with farmers from nineteen states.\1\ The curriculum
begins with basic information on planning, budgeting and the importance
of keeping receipts, and it culminates with more complex matters such
as the records needed to file an Internal Revenue Service Schedule F
Form or complete a Farm Services Agency Farm and Home Plan. A follow-up
to a previous report from winter 2005, this summary analysis presents
the results from an assessment survey of training participants.
---------------------------------------------------------------------------
\1\ These organizations were: Homeworkers Organized for More
Employment, Intertribal Agriculture Council, Minnesota Farmers
Association, Minority Agricultural Producers, Operation Spring Plant,
Rural Advancement Fund, Small Farmers Resource and Training Center, and
United Farmers.
---------------------------------------------------------------------------
Methods
At the end of each financial training session, an assessment
questionnaire was distributed to all participants. Items focused on
their personal and farm characteristics, risk management strategies and
perceptions of the training. Data presented in this preliminary report
were obtained from the survey. The data represent the characteristics
of those people who participated in the financial training. Although
this aggregation of samples is not representative of all small-scale,
limited resource and minority farmers, respondents may represent the
people most likely to first participate in future programs aimed at
providing assistance to the traditionally underserved.
Responses from 1142 participants were entered into SPSS
(Statistical Package for the Social Sciences), a software program for
data analysis. It is important to recognize that a few of the training
sessions used a questionnaire that only had assessment items, and some
questions were not applicable to all respondents (for example, if the
participant was a beginning farmer).
Summary Results
Socio-Demographic and Farm Characteristics
The financial training participants who completed questionnaires
were from nineteen states: Arizona, California, Florida, Georgia,
Idaho, Maine, Minnesota, Montana, Nebraska, New Mexico, North Carolina,
North Dakota, Oregon, South Carolina, Texas, Utah, Washington,
Wisconsin and Wyoming. Table 1 shows the socio-demographic
characteristics of training participants. Nearly \1/3\ of the
participants were women. Black/African American participants
constituted the largest racial/ethnic group (54.9 percent), followed in
frequency by American Indians, Hispanics, Whites and Asian Americans
(primarily Hmong). Almost 30 percent of participants reported their
highest level of education as being less than high school, while 34.8
percent reported a high school degree. A combined 35.6 percent reported
some college, a bachelor's degree or higher.
Farm income was generally low among the training participants.
Asked about their total farm income minus expenses in 2003, 54.0
percent of producers reported less than $5,000. The next largest groups
were those with total farm incomes between $5,000 and $9,999 (23.5
percent) and $10,000 and $19,999 (13.9).
Over \4/5\ of the training participants owned land, and 38.8
percent rented land (Table 2). Those who reported owning and renting
land totaled 28.1 percent. The average amount of land in agricultural
production was 85.2 acres in 2003, and average anticipated land in
production in 2004 was 87.4. However, the median was 15 acres. This
substantial difference from the mean suggests a skew in farm sizes
across the group of participants. The range was over 2,000 acres. Much
of the variation was due to region of the country and the type of
production.
More than \1/2\ of the training participants who reported some type
of farming activity indicated that they produced commodity crops, 54.6
percent produced vegetables, and 47.1 raised livestock. Over 14 percent
of respondents did all three. They produced commodity crops and fruits/
vegetables and raised livestock. Many of the western/southwestern
respondents grew hay and raised cattle and/or horses, while a majority
of those from the southeast reported growing vegetables and fruit. The
most frequently produced vegetables and fruits were watermelon, okra,
squash, tomatoes, cucumbers and greens.
Close to 4.7 percent of producers had a risk management plan for
their farming enterprise (Table 3). A much larger group (42.7 percent)
of respondents indicated that they used a tax accountant. Only 18.6
percent reported using the IRS Schedule F Form in their tax
preparation. Nearly 85 percent of respondents never used crop
insurance.
Approximately 18 percent of the farming respondents said that
someone in their family (in addition to themselves) received wages from
the farming enterprise (Table 4). Beyond the family, a large majority
of the respondents did not have full-time (85.4 percent), regular part-
time (80.5) or seasonal/migrant employees (83.6). Almost \1/2\ of the
16.4 percent who reported seasonal or migrant workers indicated that
these employees held H-2A Visas/participated in the guest worker
program. Just over 14 percent of total respondents said they understand
tax laws for hired farm labor.
Investigating awareness of government agricultural programs,
training participants were most familiar with the Cooperative Extension
Service (58.1 percent). The Farm Services Agency Disaster Program
(54.4) and FSA Credit Program (52.5) had similar levels of familiarity.
The Natural Resources Conservation Service (48.7), Rural Development
(42.0) and Risk Management Agency (35.7) followed in consecutive rank
order.
Concerning program participation, over \1/4\ of participants
reported having ever applied for a loan from the U.S. Department of
Agriculture (Table 5). Of those, 91.3 percent indicated that they had
ever been denied a loan, and 32.0 percent of those who ever applied
also reported having received a loan. Those who had ever been denied
and those who had ever received a loan often overlapped. Over \1/3\ of
participants said that they had ever received disaster assistance,
while a smaller percent participated in annual commodity programs (13.5
percent) or conservation programs (8.1).
Financial Training Assessment
Charged with assessment of the financial training sessions,
participants appeared to be generally pleased with the process and
curriculum (Table 6). A large majority of respondents agreed/strongly
agreed that the materials were informative, trainers were helpful and
the system applied to their needs. Although the group as a whole was
highly supportive, it is important to point out that a sizable minority
were not quite sure that they were better prepared to manage the farm
or prepare tax forms. Provided with the opportunity to list additional
trainings they would like to participate in, respondents mentioned
taxes and computer use most frequently.
Summary
The summary results presented here show that a diverse group of
farmers participated in the financial record keeping training sessions
developed and implemented by the Rural Coalition and its partner
organizations. Similar to the characteristics of those people who were
involved in prior action research studies headed by the RC,\2\ these
small-scale, limited resource and minority producers operate a broad
range of farm types. Furthermore, they are underserved by existing
programs. Having low incomes, few risk management plans, and limited
awareness of and participation in government agencies and programs,
greater attention is needed to better understand and respond to their
interests and concerns. Services must be provided in culturally
appropriate ways that also matches farm production and marketing
characteristics. Training for risk management and financial record
keeping is one step in the right direction, but there is still much
work to be done.
---------------------------------------------------------------------------
\2\ Reports from Rural Coalition action research studies are
available online at: http://ntweb.deltastate.edu/vp_academic/jgreen/
Research_and_Outreach_Underserved_Farmers.htm.
Table 1: Socio-Demographic Characteristics of Participants from Rural
Coalition Financial Training Project (2004/2005)
------------------------------------------------------------------------
Characteristic Percent
------------------------------------------------------------------------
Gender
Male 67.5
Female 32.5
(1,048)
Race/Ethnicity
American Indian 24.8
Asian American 3.5
Black/African American 54.9
White 5.0
Hispanic/Latino 10.7
Other 1.1
(1,052)
Highest Level of Education
Less than High School Degree 29.6
High School Degree 34.8
Some College, No Bachelor's Degree 29.6
Bachelor's Degree or Higher 6.0
(1,050)
Total Farm Income (after expenses) in 2003
Less than $4,999 54.0
$5,000-$9,999 23.5
$10,000-$19,999 13.9
$20,000-$29,999 4.3
$30,000 or More 4.3
(814)
------------------------------------------------------------------------
Table 2: Farm Characteristics of Participants from Rural Coalition
Financial Training Project (2004/2005)
------------------------------------------------------------------------
Characteristic Percent
------------------------------------------------------------------------
Own Land 84.5
(911/1,078)
Rent Land from Others 38.8
(409/1,053)
Own and Rent Land 28.1
(295/1,048)
Acres in agricultural production in 2003 *
Mean 85.2
Median 15.0
Minimum-Maximum 0-2,400
(937)
Acres in agricultural production in 2004 *
Mean 87.4
Median 15.0
Minimum-Maximum 0-2,600
(935)
Produced Commodity Crops in 2003 or 2004 54.5
(561/1,030)
Produced Fruits/Vegetables in 2003 or 2004 54.6
(553/1,013)
Raised Livestock in 2003 or 2004 47.1
(480/1,020)
Produced Commodity Crops, Fruits/Vegetables and 14.3
Livestock in 2003 or 2004
(137/960)
------------------------------------------------------------------------
* Ranchers often did not include grazing acreage in their estimates of
land in agricultural production. Therefore, the numbers presented here
are conservative estimates.
Table 3: Risk Management Strategies of Participants from Rural Coalition
Financial Training Project (2004/2005)
------------------------------------------------------------------------
Risk Management Strategy Percent
------------------------------------------------------------------------
Have Risk Management Plan 4.7
(45/961)
Use a Tax Accountant 42.7
(439/1,029)
Make Use of IRS Form Schedule F 18.6
(165/886)
Ever Purchased Crop Insurance
Yes, Currently Have Policy 9.6
Yes, But No Current Policy 5.8
No, Never 84.6
(971)
------------------------------------------------------------------------
Table 4: Labor Use of Participants from Rural Coalition Financial
Training Project (2004/2005)
------------------------------------------------------------------------
Risk Management Strategy Percent
------------------------------------------------------------------------
Spouse, Children or Other Family Members Receive Wages 17.7
from Farm
(154/869)
Number of Full-Time Employees
None 85.4
1-10 14.0
11-20 0.3
21 or More 0.3
(988)
Number of Regular Part-Time Employees
None 80.6
1-10 17.9
11-20 0.9
21 or More 0.6
(987)
Employed any Seasonal or Migrant Employees in the Past 16.4
Year
(127/773)
Any Seasonal or Migrant Employees Participate in H- 50.4
2A Program
(64/127)
Understand Tax Rules for Farm Labor 14.5
(126/870)
------------------------------------------------------------------------
Table 5: Awareness of and Participation in Government Programs Among
Participants from Rural Coalition Financial Training Project (2004/2005)
------------------------------------------------------------------------
------------------------------------------------------------------------
Agency/Program Percent Aware
------------------------------------------------------------------------
Farm Services Agency Credit Programs 52.5
(533/1,015)
Farm Services Agency Disaster Payments 54.4
(522/959)
Natural Resources Conservation Service 48.7
(465/955)
Cooperative Extension Service 58.1
(567/976)
Rural Development 42.0
(400/953)
Risk Management Agency 35.7
(335/939)
------------------------------------------------------------------------
Program Program
Participation
------------------------------------------------------------------------
Ever Applied for a Loan from USDA 27.9
(234/839)
Ever Been Denied a Loan from USDA 91.3
(210/230)
Ever Received a Loan from USDA 32.0
(72/225)
Ever Received USDA Disaster Assistance 36.2
(354/977)
Participate in any Annual Commodity Program 13.5
(113/839)
Participate in any Conservation Program 8.1
(84/1,040)
------------------------------------------------------------------------
Table 6: Participant Rating of Financial Recording Keeping Training
Session--Rural Coalition Financial Training Project (2004/2005)
------------------------------------------------------------------------
------------------------------------------------------------------------
Statement Strongly Disagree Agree Strongly
Disagree Agree
------------------------------------------------------------------------
Materials were 2.2 3.3 57.5 37.0
informative (1,020)
Trainers were 1.6 4.7 52.4 41.3
helpful (1,023)
Training related to 1.5 7.2 58.7 32.6
my specific needs
(1,013)
I am better prepared 2.2 13.9 53.8 30.1
to manage my farm
(1,007)
I am better prepared 3.6 16.6 53.4 26.4
to complete tax
forms (1,010)
Overall, the 2.0 4.0 56.4 37.6
training was
helpful (1,019)
I would recommend 2.3 2.8 45.8 49.1
the training to
others (1,017)
------------------------------------------------------------------------
Statement Not Helpful A Little Helpful Very
Helpful Helpful
------------------------------------------------------------------------
Discussion of the 0.6 6.5 54.5 38.4
importance of
keeping records
(1,008)
Concepts and 1.2 12.1 55.2 31.5
definitions (1,003)
What records to keep 0.9 11.3 51.1 36.7
and how to do it
(1,001)
Exercises and 1.2 13.2 53.1 32.5
examples (993)
Record keeping 1.3 9.7 55.1 33.9
worksheets (1,003)
------------------------------------------------------------------------
[Research Findings and Policy Recommendations 2]
The Insurance Needs of Traditionally-Underserved Farmers: Framework for
a Multi-Community Assessment
John J. Green, Lorette Picciano, Heather Fenney and Christopher Pope *
---------------------------------------------------------------------------
* John J. Green and Christopher Pope are associated with the
Institute for Community-Based Research (Center for Community
Development, Delta State University). Lorette Picciano is Executive
Director of the Rural Coalition. Heather Fenney, former Food and Farm
Policy Coordinator for the Rural Coalition, works with the Community
Food Security Coalition.
For more information, contact: John J. Green, Ph.D., Division of
Social Sciences, 201B Kethley Hall, Delta State University, Cleveland,
MS 38733.
E-mail: [email protected].
Paper to be Presented at the Annual Meeting of the Rural Sociological
---------------------------------------------------------------------------
Society, Montreal, Canada
July 2003
The insurance needs of individuals, families and their
businesses are of critical importance for livelihood security.
Although often overlooked in community and economic development
initiatives, small-scale, limited resource and minority farmers
are continuously faced with the challenge of finding strategies
to manage risks in the realms of agricultural production,
marketing and everyday life. In an attempt to address this
issue, a community-based research effort--including partner
organizations from across the United States--was established to
collect survey data concerning the risk management and
insurance needs of traditionally-underserved populations. The
information garnered from the research will be used to inform
the development of a model cooperative insurance program. This
paper reviews the position of traditionally-underserved
farmers, discusses the theoretical framework of community-based
research and describes the methods utilized for this ongoing
study. Preliminary research findings are shared for
illustrative purposes.
Draft Paper for Presentation--Do Not Cite Without Permission
Introduction: The Position of Traditionally-Underserved Farmers
The dominant political economic system is characterized by further
industrialization and expansion of free market relations. This entails
a continued push by corporate firms to harmonize socioeconomic policies
and create a global playing field conducive to capital mobility and
accumulation. These developments are taking place within the agrifood
sector in conjunction with a shift in the dominant system from
protection of national agricultures supported under the ``development
project'' to further free trade promoted as part of the ``globalization
project'' (McMichael 1996). Strategies include the creation of ``food
chain clusters'' through horizontal and vertical integration of
agribusiness firms to control food from the gene to the store shelf
(Heffernan 2000; Heffernan, et al., 1999; Hendrickson, et al., 2001).
These changes come at a significant cost to agricultural producers as
they are exposed to international competition, removal of government
protections and increasing corporate control over decision making.
Within this process there are winners and losers, with small, limited
resource and minority farmers facing intense pressure.\1\
---------------------------------------------------------------------------
\1\ There are a variety of labels used in reference to such
farmers. Although the term ``small farmer'' is typically used as a part
of mainstream nomenclature, the label only differentiates along lines
of scale and often structure (i.e., ``small farmer'' usually, but not
always, implies ``small family farmer''). The term ``limited resource
farmer'' refers to producers who have both low farm sales and low
overall household income, and ``minority'' is typically used in
reference to traditional ethnic and racial groupings. These labels are
often used in reference to ``socially disadvantaged farmers,'' defined
by the U.S. Department of Agriculture as those farmers historically
subjected to prejudice because of their membership in a particular
group, by race and ethnicity. Also sometimes included in this realm are
women producers. In this paper, we use ``small, limited resource and
minority farmers'' in reference to all of these groups, recognizing
both their similarities and differences. The term ``traditionally-
underserved'' is used in reference to the fact that these producers
have been disadvantaged by dominant social institutions.
---------------------------------------------------------------------------
There are many facets of the dominant agrifood system that have
presented challenges to these producers throughout recent history. In
the past, the exploiter (such as a large-scale landowner, merchant or
local banker) was typically located in the community or, at the least,
had a recognizable identity (e.g., the railroad). However, dominant/
subordinate relations in the global era are increasingly separated
spatially as economic management occurs at higher levels, is abstracted
and made to appear ``natural.'' Globalization, however, does not
necessarily equate with the removal or even scaling-up of national
challenges. Rather, complex interactions take place and problems are
often compounded, with those groups who historically bore the greatest
burdens being placed in even more problematic positions.
Synthesis of research endeavors (e.g., Dismukes, et al., 1997;
Federation of Southern Cooperatives 2000; General Accounting Office
2001; Gilbert, et al., 2001; Green and Picciano 2002; Grim 1996; Jones
1994; Wood and Gilbert 1998) supports the argument that small, limited
resource and minority farmers face a variety of challenges, some of
which are inherent to farming and others which result more from social
inequality. Challenges include environmental production constraints
such as low soil fertility and disasters (e.g., floods and droughts)
which are partially attributable to these producers' disproportionate
reliance on relatively small and often marginal landholdings. Also
problematic are constraints to landholding, including high land prices,
loan interest rates and property taxes, and predatory actions by other
farmers and commercial lenders. Additionally, limited financial
resources and restricted access to markets and subjugation to low
prices are troubling. More specific to group identity,
American Indian and Alaskan Native producers face challenges
coupled with the complexities of dealing with the myriad of
Federal bureaucracies involved in the governance and control of
Tribal lands and resources. In addition, Indian producers have
been specifically excluded from resources and support afforded
other producers.
A large proportion of the nation's remaining Black/African
American producers have faced tremendous barriers to
maintaining their operations. From slavery to the 1999
settlement of the Pigford v. Glickman class action lawsuit,
these producers have struggled with discrimination at the
personal and institutional levels.
During the early 1940s the now infamous ``Bracero Program''
brought in Mexican farm laborers to work in fields across the
country. After termination of the program, farmwork continued
to be performed by immigrants and migrants. Many of them have
attempted to obtain a more secure position in agriculture
through operation of their own farms. Within the last 5 years
they have become one of the fastest growing groups of small
farmers. They have used their hard earned money to buy some
acreage for farming, all the while maintaining other jobs.
Following the Vietnam War, immigrants from Southeast Asia
included a large sector of Hmong people. Hundreds of new Hmong
producers have entered agricultural production in the United
States. Although they have survived, these producers often face
barriers related to their minority status in an often hostile
environment.
Small, limited resource and minority farmers have faced many
challenges in the structure of the dominant agrifood system.
Furthermore, they have been underserved by the institutions supposed to
mediate between the macro-level of global, regional and national
political economic forces and the micro-level of everyday life. For
instance, government agencies such as the United States Department of
Agriculture (USDA) have made few authentic attempts to assist these
producers in mitigating challenges or taking advantage of new
opportunities.
Although the Federal and state governments have developed numerous
programs to assist farmers, much of their work has followed a highly
problematic and biased path. A variety of barriers keep these farmers
from fully participating and/or receiving the benefit of potentially
helpful programs. Problems include agencies' preferential attention to
large-scale producers employing technologically complex and capital
intensive strategies, personal and institutional discrimination, and
insufficient outreach.
Dismissal and outright hostility toward these producers has led to
skepticism on the part of farmers concerning government agricultural
programs and agency personnel (Grim 1996). Farmers are also often
confused by the different agencies and programs that exist. Given past
experience, it is generally expected that without targeted research,
outreach and advocacy efforts, these groups will continue to under-
participate in government programs and continue to be lost, thereby
offsetting hard won gains.
A recent focus group project (Green and Picciano 2002) involving
farmers in fourteen communities across the United States asked
participants about their familiarity with various programs and
services. The 130 focus group participants indicated the most
familiarity with Cooperative Extension, their respective State
Department of Agriculture, Farm Services Agency (FSA) (credit programs
and farm and disaster programs) and the Natural Resources Conservation
Service (NRCS). Some of the lowest levels of awareness were reported
for Soil and Water Conservation District Boards and FSA County
Committees. There were numerous instances where focus group
participants had not taken part in the programs offered by these
agencies. Less than \1/4\ of the participants had ever received a loan
through USDA, and over 30 percent reported having been denied such a
loan. Thirty-two percent of focus group participants indicated that
they had ever received USDA Disaster Assistance. Even fewer reported
participation in annual commodity programs.
While there has been much research attention directed toward
inequality in government policy and programs, less interest has been
directed toward other arenas of activity of concern for small, limited
resource and minority farmers. Still, rural sociologists have directed
attention toward the political economy of credit (Mooney 1986), a
crucial aspect of agriculture. Unfortunately, few researchers have
turned their attention to the insurance needs of these traditionally
underserved farmers.\2\
---------------------------------------------------------------------------
\2\ Economists have conducted research on the role of crop
insurance in risk management (e.g., Harwood, et al., 1999; Makki and
Somwaru 2001). Much of this work, however, narrowly assesses farmer
selection of and participation in crop insurance markets. What is
needed is a more general and critical assessment of traditionally-
underserved farmers and their relationship to insurance as an
institution.
---------------------------------------------------------------------------
Risk has always been a part of the agricultural business. Widely
considered an important aspect of risk management, crop, liability,
health, disability and life insurance are sometimes seen as luxuries
for the small farmer. Just as they tend to be ignored by the banking
community, small farmers are often overlooked by insurance companies
and agents. This is particularly problematic given the ever-expanding
focus on insurance as a risk management tool under the auspices of
advanced capitalism. Furthermore, the increased control awarded to for-
profit insurance companies with the Federal Government's partial
privatization of crop insurance programs is of concern.
The industry cites perceived barriers to serving small, limited
resource and minority farmers. These include: (1) the smaller the
acreage the less profitability for the insurance agency, (2) the lack
of multilingual and multicultural employees to deal with new markets,
(3) the lack of available agents to serve culturally diverse and
regionally isolated populations (e.g., new immigrants, or producers on
isolated Tribal lands), and (4) the complexity of the insurance
business for the average person due to the required paperwork and
expertise.
Interestingly, agricultural producers offer a somewhat different
view of participation/nonparticipation in insurance. The previously
cited focus group project (Green 2002; Green and Picciano 2002)
involved a discussion of crop insurance. Producers said that although
they recognized insurance as an important risk management tool, they
either knew very little about the system, insurance was too costly or
it was inappropriate for their type of farm. Concerning the latter,
participants reported that they did not have a large enough farm, their
level of production was insufficient or what they produced was not
covered under most policies. Further discussion revealed their support
for crop insurance in general, but only with the caveat that vast
improvements are needed.
It is worth noting that insurance as a risk management tool is
important for agricultural producers beyond crop or whole farm
insurance. Similar to the situation faced by individuals and families
in general (including those operating family businesses), small,
limited resource and minority farmers must also consider how to address
issues of liability insurance, car insurance, health and life
insurance.\3\
---------------------------------------------------------------------------
\3\ Health coverage was once part of the New Deal programming
channeled through the USDA. From 1932 to 1947, the Farm Security
Administration sponsored comprehensive medical care for poor farmers,
sharecroppers and migrant workers (Grey 1994).
---------------------------------------------------------------------------
Despite the many hardships that exist, these farmers continue to
struggle forward. Considered together as a diverse group of
traditionally-underserved farmers, they have already overcome great
odds to remain in agriculture and on the land. Dedicated to cooperative
ideals in the effort to improve their livelihood security, many
individuals and groups have the potential to revive their historic
connection. Small businesses in agriculture are likely to become more
diverse if they are able to develop assets to address the many historic
barriers that have served to exclude them from the economic benefits
available to their more powerful counterparts. Their ability to do so
is important not just for them, but for the sustainable development of
their communities (Clancy, et al., 2003).
Community-based organizations, including nonprofits and
cooperatives, have long attempted to fill the gap in providing
assistance to traditionally-underserved producers, and they have been
successful in many cases. However, in order to further impact the
viability of these farms over the long-run, it will be necessary for
organizations to work together and with government agencies in the
development and implementation of programs based on their actual needs
and interests.
Community-Based Research for Developing a Cooperative Model
Recognizing this need, the Rural Coalition, several of its member
groups and University researchers are involved in a collaborative
project to identify the current situation faced by these producers in
respect to risk management and insurance. This is being done using the
community-based research model.
Community-based research is a framework for pursuit of grassroots
empowerment. It brings together those research approaches described as
``participatory'' and ``action'' oriented in nature (e.g., Chambers, et
al., 1989; Reason and Bradbury 2001; Selener 1997; Stringer 1999; Voth
1979). Building from an assorted background of theory and method, these
various approaches share several common principles, including
collaboration through meaningful participation, acquisition of
knowledge and pursuit of social change (Reason and Bradbury 2001). The
primary goal of such research is to generate knowledge and thereby
redistribute power (Selener 1997).
According to Ernest Stringer's interpretation and synthesis of the
framework, community-based research consists of three primary
components in a cyclical and dialectic relationship: (1) look, (2)
think and (3) act. At the looking stage, research participants are
invited to witness the world around them by gathering data, defining
issues of importance and describing them in an effort to construct
``pictures'' of the community. The thinking stage calls for
exploration, analysis and interpretation of these pictures for the
purpose of explaining the state of the world and developing theories to
effectively inform action. This action may entail reporting research
findings as well as planning, implementing and evaluating programs of
social change. Over the course of any particular attempt to address a
social issue, it is assumed that this cycle will be repeated over and
again, each time spiraling to a heightened level of collective
consciousness and efficacy.
The Rural Coalition--a nonprofit organization providing advocacy,
outreach and technical assistance to community-based organizations in
the United States and Mexico--is working with several groups to conduct
an in-depth survey of traditionally-underserved farmers on their
socioeconomic background, farm characteristics and economic situation,
with special attention to their use of insurance. This effort
explicitly builds from a past project to better understand the concerns
and interests of these agricultural producers to help inform
policymaking and program development (Green 2001; Green and Picciano
2002). Project partners include the following organizations.
CASA del Llano is a community-based organization working with
two unincorporated Colonias near Hereford, Texas. The
organization consists of members from these Colonias and
members of a church community with a volunteer staff serving as
an Advisory Board. The project initiated from The Promised Land
Network, an ecumenical rural ministry dedicated to shaping
southern plains agriculture and communities toward
sustainability based on sound land stewardship and ethical
principles. The program serves Latino farmers and new entry
immigrant produces.
Growing Power is a not-for-profit organization and land trust
supporting people from diverse backgrounds and the environment
they live in through the development of community food systems.
Growing Power serves the nation through three offices in
Alaska, where it assists Alaska Native producers, and Wisconsin
and Illinois, where it serves diverse urban producers. Growing
Power seeks to develop and preserve resources and programs that
support community self reliant food systems through education,
conservation, networking, advocacy, marketing, growing and
processing.
Homeworkers Organized for More Employment (HOME), a
cooperative community in Orland, Maine dedicated to economic
and social reconstruction, began as an outlet for homeworkers'
crafts and has expanded to include pottery, leather and weaving
shops, greenhouse gardens, a farmers market and a sawmill/
shingle mill.
The Minnesota Food Association (MFA) is a statewide nonprofit
organization with members who represent urban and rural
perspectives, various income levels and many different
interests. Its mission is to form a coalition of informed,
connected and active people to work together to build a more
sustainable food system. Over the last several years, the
Minnesota Food Association has been working to develop
comprehensive strategies to address economic, health, safety
and nutrition concerns related to food production and
agriculture for new immigrant residents in Minnesota. This
long-term project has helped to educate new immigrant farmers
on many aspects of agriculture, as well as to assist them in
becoming a permanent part of the rural economy.
Operation Spring Plant (OSP) is a grassroots organization
started and operated by farmers in North Carolina. OSP serves
small, limited resource and African America producers through
technical assistance workshops and training; developing on-farm
demonstration projects that focus attention on modern and
sustainable production techniques; owning and operating a
retail marketing facility for farm and agribusiness products;
and assisting area farmers through financial hardships. OSP has
been very active in advocating for the civil rights of Black
farmers. The organization also operates a Harvest for the
Hungry Program that provides food for low-income people.
Rural Advancement Fund of the National Sharecroppers Fund
(RAF-NSF), founded in 1937, is based in Orangeburg, South
Carolina and works to uplift small, primarily African American
farmers and rural organizations in North and South Carolina.
RAF provides training and one-on-one technical assistance in
crop selection, management, cash flow analysis and loan
packaging, crop diversification and marketing.
Rural Community Development Resources, based in Yakima,
Washington, has helped over 100 limited resource Hispanic
producers enter agriculture and build successful collaborative
businesses. RCDR administers a revolving loan fund for its
members and is training them in the formation of cooperatives.
It assists them in qualifying for loans and completing USDA
farm and home plans. With support from the USDA Minority Farm
Outreach Program, RCDR now reaches more than 190 farmers with
technical assistance and other support.
Institute for Community-Based Research (Center for Community
Development, Delta State University) works with nonprofit
organizations and cooperatives to assist in the design,
implementation, and analysis of research in pursuit of
livelihood security and improved quality of life. Substantive
areas of focus include: (1) underemployment and persistent
poverty, (2) environment, health and food security, and (3)
organizing cooperative alternatives. Housed within the Center
for Community Development at Delta State University, the
Institute is closely affiliated with the Division of Social
Sciences. A central component of this effort is to provide an
avenue through which DSU students, especially those pursuing a
Master of Science degree in Community Development, are able to
collaborate with faculty and communities to engage in timely
and meaningful research.
The objectives of this collaborative project include:
(1) Strengthening the capacity of the community-based organizations
to meet their members' needs by expanding their knowledge
and understanding of how insurance works and the structure
of the industry.
(2) Ensuring the risk management needs of small, limited resource
and minority producers are equitably met by developing new
strategies to improve the content, marketing and delivery
of appropriate insurance products.
(3) Developing and testing the feasibility of a model cooperative
business venturethat recognizes the value of community-
based organizations and providesappropriate incentives to
secure their equitable participation in the delivery
ofinsurance and other risk management tools.
(4) Sharing project results with the participating groups and
familiarizing them with insurance, how it works and ways to
use insurance tools to increase the livelihood security of
traditionally-underserved farmers and invest in their
communities.
Research partners have worked together to develop the survey
instrument, construct guidelines for selecting samples, collect data
and analyze results. After several drafts of the questionnaire had been
circulated and revised, the partners met in Washington, D.C. to review
the document and participate in an interviewer training workshop.
Following this meeting, changes were made to the data collection
instrument.
With the final version of the survey in hand, individuals from the
community-based organizations began selecting agricultural producers to
interview. Because this project is focused on improving access to risk
management services for traditionally-underserved populations in an
applied and strategic manner, a purposive systematic sampling strategy
was utilized. Use of this technique was also justified on the basis of
the project being exploratory in nature. A list of qualifying criteria
was used in selecting purposive samples in each of the six communities
where surveys were to be conducted (see Appendix for sampling
criteria).
The organizations agreed to complete a minimum of thirty surveys.
Four of the six groups involved in collecting data had met this
threshold by the time of submitting this paper (June 2003). Two of the
groups are still in the process of conducting interviews. (See Appendix
for preliminary survey results). Future analysis will involve aggregate
and across group descriptive statistics. Also, nonparametric
statistical strategies will be utilized for group comparisons and to
identify the relationships between farmers, their communities and
insurance needs and interests.
During the same time period as the survey has been developed and
implemented, partners have been participating in crop insurance
training sessions to better understand the industry and the types of
alternatives to traditional insurance programs that could be created.
This will help to inform the construction of more applicable and
targeted insurance packages and cooperative models of delivery. In
conjunction with the Rural Coalition, Rural Development Resources is
developing model business plans for cooperative insurance ventures to
help better serve small, limited resource and minority producers. These
business plans will then be taken back to partner organizations for
review and revision before being presented to RMA for possible test
implementation.
Discussion
This paper argues that small, limited resource and minority farmers
have been underserved by social institutions important to mediating the
pressures of larger scale forces (e.g., market control by agribusiness,
harmonization of national agricultural policies, and adverse
environmental conditions). Relative to larger, capital-intensive and
corporate controlled entities, these producers have faced inequality in
accessing markets, long and short-term capital, government outreach and
technical assistance. With the ever increasing role of insurance in
managing risk, traditionally-underserved farmers face additional
challenges, such as limited access to applicable information, insurance
companies and policies that are not responsive to their needs, and cost
prohibitions.
Although these are difficult challenges, the collaborative partners
in this project, led by the Rural Coalition, are utilizing community-
based research to inform program planning, implementation and
evaluation. They are in the process of identifying and documenting the
needs and interests of traditionally-underserved farmers in regard to
insurance. This information is being used in the development of a
cooperative approach to managing risk that benefits the participants,
their organizations and communities.
References
Chambers, R., A. Pacey and L.A. Thrupp. 1989. Farmer First: Farmer
Innovation and Agricultural Research. London, UK: Intermediate
Technology Publications.
Clancy, K., S. Grow and L. Oberholtzer. 2003. Agriculture as a Tool
for Rural Development: Workshop Proceedings. Henry A. Wallace Center
for Agricultural and Environmental Policy.
Dismukes, R., J.L. Harwood and S.E. Bentley. 1997. ``Characteristics
and Risk Management Needs of Socially Disadvantaged Farmers.''
Washington, D.C.: United States Department of Agriculture.
General Accounting Office. 2001. Farm Programs: Information on
Recipients of Federal Payments. Washington, D.C.
Federation of Southern Cooperatives/Land Assistance Fund. 2000.
``Risk Management Survey of African American Farmers: Preliminary
Findings.'' East Point, GA: Federation of Southern Cooperatives/Land
Assistance Fund.
Gilbert, J., G. Sharp and M.S. Felin. 2001. ``The Decline (and
Revival?) of Black Farmers and Rural Landowners: A Review of the
Research Literature.'' Madison, WI: Land Tenure Center, University of
Wisconsin.
Green, J.J. 2002. ``Statement on the Implementation of Title I of
the Agricultural Risk Protection Act with Respect to the Needs of
Socially Disadvantaged and Other Limited Resource Producers.'' U.S.
House of Representatives Committee on Agriculture, Subcommittee on
General Farm Commodities and Risk Management.
Green, J.J. and L. Picciano. 2002. ``Amplifying the Voices of
Community-Based Organizations through Action Research: Obtaining Input
from the Grassroots on Agricultural Policies and Programs.'' Paper
Presented at the Annual Meeting of the Community Development Society,
Cleveland, MS.
Grey, M.R. 1994. ``The Medical Care Programs of the Farm Security
Administration, 1932 through 1947: A Rehearsal for National Health
Insurance.'' American Journal of Public Health 84(10): 1678-1687,
Grim, V. 1996. Black participation in the Farmers Home
Administration and Agricultural Stabilization and Conservation Service,
1964-1990. Agricultural History 70(2): 321-336.
Harwood, J., R. Heifner, K. Coble, J. Perry and A. Somwaru. 1999.
Managing Risk in Farming: Concepts, Research and Analysis. Washington,
D.C.: Economic Research Service, United States Department of
Agriculture.
Heffernan, W.D. 2000. ``Concentration of Ownership and Control in
Agriculture.'' Pp. 61-75 in F. Magdoff, J.B. Foster and F.H. Buttel
(eds.) Hungry for Profit: The Agribusiness Threat to Farmers, Food, and
the Environment. New York, NY: Monthly Review Press.
Heffernan, W., M. Hendrickson, and R. Gronski. 1999. ``Consolidation
in the Food and Agriculture System.'' National Farmers Union.
Hendrickson, M.K. and W.D. Heffernan. 2001. ``Opening Spaces through
Relocalization: Opportunities Provided by the Failures of the
Globalized Industrialized Food System.'' Paper Presented at Workshop
for Rethinking Food Production--Consumption: Integrative Perspectives
on Agrarian Restructuring, Agro-Food Networks and Food Politics. Santa
Cruz, CA.
Hendrickson, M.K., W. Heffernan, P. Howard, and J. Heffernan. 2001.
``Consolidation in Food Retailing and Dairy: Implications for Farmers
and Consumers.'' National Farmers Union.
Jones, H.S. 1994. ``Federal Agricultural Policies: Do Black Farm
Operators Benefit?'' The Review of Black Political Economy 22(4): 25-
50.
Makki, S.S. and A. Samwaru. 2001. ``Evidence of Adverse Selection in
Crop Insurance Markets.'' The Journal of Risk and Insurance 68(4): 685-
708.
Mooney, P.H. 1986. ``The Political Economy of Credit in American
Agriculture.'' Rural Sociology 51(4): 449-470.
McMichael, P. 1996. ``Globalization: Myths and Realities.'' Rural
Sociology 61(1): 25-55.
Reason, P. and H. Bradbury (eds.). 2001. Handbook of Action
Research: Participative Inquiry and Practice. London, UK: Sage
Publications.
Selener, D. 1997. Participatory Action Research and Social Change.
Ithaca, NY: Cornell University.
Stringer, E.T. 1999. Action Research. Thousand Oaks, CA: Sage
Publications.
Voth, D.E. 1979. ``Social Action Research in Community
Development.'' Pp. 67-81 in E.J. Blakely (ed.) Community Development
Research: Concepts, Issues, and Strategies. New York, NY: Human
Sciences Press.
Wood, S.D. and J. Gilbert. 1998. ``Re-entering African-American
Farmers: Recent Trends and a Policy Rationale.'' Madison, WI: Land
Tenure Center, University of Wisconsin.
Appendix A: Survey Recruitment Guidelines
The following guidelines were used in selecting and recruiting
people to complete surveys on the Risk Management and Insurance Needs
of Small, Limited Resource and Minority Farmers.
(1) Survey participants must be:
Farmers or ranchers (established or entering) who were involved
in agriculture during the year 2002.
(2) Survey participants should reflect the composition of the
constituency your organization serves.
Attention should be given to recruiting survey participants
that generally represent your organization's constituency,
including ethnicity and race.
Survey participants do not have to be formal members of your
organization. If possible, a minimum of half the
participants should be nonmembers.
(3) Survey participants should include gender diversity.
A serious attempt is needed to find and survey women farmers as
a part of this project.
(4) Survey participants should include age diversity.
A serious attempt is needed to find and survey farmers of
various ages eighteen years and above.
(5) Survey participants should not be recruited based on existing
knowledge of their operation or past involvement with crop
insurance.
Appendix B: Preliminary Results from Rural Coalition Survey on the Risk
Management and Insurance Needs of Small, Limited Resource and
Minority Farmers
Meeting the Risk Management and Insurance Needs of Small, Limited
Resource And Minority Farmers
2003 Survey
The following tables were constructed using data collected in the
2003 survey on the risk management and insurance needs of small,
limited resource and minority farmers. This survey was developed and
implemented by the Rural Coalition and its partners, including: CASA
del Llano, Growing Power, Homeworkers Organized for More Employment
(HOME), Minnesota Food Association (MFA), Operation Spring Plant, and
Rural Advancement Fund (RAF). The Institute for Community-Based
Research (Center for Community Development, Delta State University) is
a collaborating partner, and Rural Community Development Resources will
utilize data in cooperative business plan development.
Four of the six groups collecting data have completed their work.
However, two of the groups are still engaged in this process.
Therefore, the data presented in the following tables represent
preliminary results in aggregate form. No group comparisons are made.*
---------------------------------------------------------------------------
* Editor's note: Appendix B of the report entitled, The Insurance
Needs of Traditionally-Underserved Farmers: Framework for a Multi-
Community Assessment, as submitted by the Rural Coalition/Coalicion
Rural for the March 25, 2021 hearing is incomplete (there are no
corresponding tables of data tables). It has reproduced herein as it
was submitted.
---------------------------------------------------------------------------
Funding for this project was provided by the Risk Management
Agency, US Department of Agriculture. The findings presented here do
not necessarily represent the views of this agency.
[Research Findings and Policy Recommendations 3]
Oklahoma Black Historical Research Project, Inc., 3506 N. Forest Park
Drive, Oklahoma City, Oklahoma 73121-2238, (405) 201-6624,
[email protected]
100 Farmers Summit Report_Addressing the Needs and Concerns of the
Underserved Minority Family Farming Community
March 16-17, 2017
Oklahoma City, OK
Produced by the Oklahoma Black Historical Research Project
In cooperation with the Rural Coalition
And the Scholars of the American University School of
International Service 2017 Farm Bill Practicum
July 3, 2017
Dear 100 Farmers Summit Participants:
On behalf of Oklahoma Black Historical Research Project, I want to
thank each and every one of you for contributing your wisdom, insights
and experience to our March 2017 100 Farmers Summit We also thank the
Socially Disadvantaged Farmers and Ranchers Policy Research Center, our
Speakers, and our small group session leaders for their assistance. And
we thank the scholars of the American University School of
International Service 2017 Farm Bill Practicum taking notes and Rural
Coalition for compiling this report of our proceedings.
We now present to you this report which summarizes the findings and
recommendations of producers representing farmers, Community Based
Organizations and 1890 leaders. We believe we successfully met our goal
of directly engaging farmers in identifying what changes they need at
the farm level to make agriculture program better serve their needs and
help them build their local economies.
The process we employed included three elements:
(1) Brainstorm needs and concerns of historically-underserved
farmers.
(2) Record the major needs, concerns, recommendations and solutions
presented.
(3) Develop a document with compiled results for review and
endorsement of each represented community-based
organizations' president or representative.
We look forward to engaging our historic producers to build our
power anew in this current political climate. We will cooperatively
translate our ideas and proposals into policy and programs that serve
our needs and allow us to build a prosperous and sustainable future for
our communities.
Respectfully submitted,
Willard Tillman, Executive Director,
Oklahoma Black Historical Research Project, Inc.
Table of Contents
I. Introduction
II. Issues, Needs and Concerns of Socially Disadvantaged Farmers
and Ranchers
III. Solutions: Building Resourceful and Ready Farmers and
Communities
IV. Policy Proposals for Statutory and Administrative Change
V. Proposals on Strategy
VI. Conclusion
I. Introduction
The meeting was opened with a welcome by Oklahoma Black Historical
Research Project Executive Director Willard Tillman. He provided a
brief introduction to the history of the 100 Farmers Summit, followed
by an introductions icebreaker.
Former United States Department of Agriculture (USDA) Secretary
Mike Espy, PLLC, presented the keynote address ``Improving Success of
Socially Disadvantaged Farmers and Ranchers Through Policy.'' He
provided a brief overview of the challenge presented by the recently
released Administration budget, noting that it contains 21% cut in
funding to the Department of Agriculture, with risks for nutrition and
other programs. He pointed out that African American producers had
survived administrative racism and discrimination, drought and many
other challenges, some of which were summarized in the DJ Miller report
(year). That report, the purposes of which was to determine if minority
farmers were denied credit found that the top 1% of loans went to 65%
of corporate farms and white male farmers. Only 1% of disaster payments
were given to Black male farmers.
However, he continued, the numbers are increasing on the farms and
ranches. In 1920--there were 1 million Black farmers with 15 million
acres = 14% of farms in the nation. In 1982, there were only 30,000
Black farmers--2% of all farmers. In 2012--the number of Black farmers
had increased to 44,000 Black farmers or 15% of all farmers.
We face a daunting environment to negotiate the 2018 Farm Bill,
Espy continued, with both opportunities and challenges:
Opportunity 1 is to grow Farmers['] Markets to counter the
defunding of Supplemental Nutrition Assistance Program (SNAP) (also
known as food stamps) and still provide quality food to impoverished
people. It is important for the group to work on what can be done to
grow and produce foods that are recognized as eligible by the SNAP
program, and to reduce the cost of the electronic benefits program.
Challenge 1 is to save the farm bill and the 20% of funds not
directed to nutrition programs. The lack of moderate Congress members
leaves little room for negotiation. Thus, it is critical to be more
aggressive in outreach to Congress and to assure that farm safety nets
do not disappear.
Opportunity 2 involves preparing to increase in food production to
meet the demand of the growing population. Congress recognizes that the
farm bill must provide tools and research to increase efficiency of
farms. He noted that even the current budget has not proposed cuts to
research, conservation, trade. Since the North American Free Trade
Agreement (NAFTA) passed in 1993, US sales of farm goods has increased
by 300%, with $21.8 billion to China, and $18.3 billion to Mexico. He
further pointed out that there are new trade opportunities in other
places, including Cuba.
Mr. Espy concluded his remarks by challenging the group to take
their proposals to Congress. ``Make sure your elected representatives
know who you are, know you aren't going away, and know that you need to
be reckoned with.''
Following Secretary Espy's remarks, Ms. Eloris Speight, Director of
the Socially Disadvantaged Farmer and Rancher (SDFR) Policy Research
Center, and retired USDA leader Lloyd Wright presented an overview of
the background, goals, strategies, of the Center and its work on Farm
Bill Planning.
The center, based at Alcorn State University, is to conduct and
coordinate research for the purpose of informing policy. They want to
make sure that the center's recommendation are data driven and
consistent literature reviews. Most of these programs relate to
participation in USDA programs. RFP's have been issued for priority
research areas.
The work of the center is intended to reflect ongoing dialogue
between academic community and stakeholders. The advisory board held an
inaugural meeting in August 2016 and is seeking input on policy
priorities for Fiscal 2017. The board advises President of Alcorn State
University on SDFRs, assists the Policy Research Center. SDFRs are more
actively involved now; haven't always had a seat at the table.
The USDA Civil Rights Executive Summary of 2011 is being used as
opening research. Four priority areas of research were identified. The
Policy Research Center will make recommendations directly to
Agriculture Committees and to the Congressional Black Caucus to prepare
for the 2018 Farm Bill. It has issued a challenge to CBOs to provide
these issues/recommendations on the fast track, as soon as possible.
She closed by noting that most ``new problems'' are old problems in
disguise. We also need to figure out how handle conflicting information
from CBOs and farmers, and set a process in place to make the best
decisions about recommendations for the majority, the through the
technical working group (formed of 1890 groups and USDA experts) and
the Advisory board. A concern remains that USDA does not have an
accurate count of SDFRs.
A group discussion followed, noting the endemic lack of
appropriations and funding for programs already established to address
critical issues. Of particular importance was securing expanded funding
for the Outreach and Assistance for Socially Disadvantaged and Veteran
Farmers and Ranchers Program (also known as 2501, after the section of
the 1990 Farm Bill in which it was originally authorized).
There is a need for more Senators and Representatives to support
the growth in funding for 2501 and other programs, and to show what the
program has accomplished. Preserving funding for other programs is als0
important in the face of a proposed FY 2018 Budget that puts $95
million on the chopping block for rural development initiatives, and
which cuts out 19 government agencies/commissions.
We need to be documenting and sharing success stories in a new
paradigm: Instead of feel-good stories, provide examples of how the
program helps communities to get the job done, to document the good
have you done with the little bit you've been given, and especially how
many jobs were created. Also important is to show that your work has
increased applications for projects.
The group also discussed the need to assure we have an accurate
count of socially disadvantaged producers in agricultural census
conducted every 5 years, with the next beginning at the end of 2017. If
the count is not right, it was pointed out, the money is not right.
Mr. Tillman then concluded with a reflection on the challenges
faced now by farmers in Oklahoma, which is low on water, with droughts
and a plethora of climate challenges. He concluded that it is important
to assure that policy better addresses 5 key risk forming factors
(health, institutional, marketing, financial, and production risk) to
get farmers into business and to stay in business.
The group then proceeded to the small group and plenary discussions
that generated the analysis, and policy and strategies present in this
report for your review, input and action.
II. Issues, Needs and Concerns of Socially Disadvantaged Farmers and
Ranchers (SDFR's)
The Small Group discussions identified several similar overall
issues, needs and concerns of SDFR's, as summarized below:
1. Lack of Knowledge by SDFR's--of what programs are available and
how to participate.
2. Lack of Trust--The long history of racism and discrimination by
USDA has resulted in a deep lack of trust for the agency.
The African American, American Indian and Hispanic farmers
have all been disenfranchised for so long by this
government--we don't trust them--don't want to deal with
the frustration and discrimination--we are left bruised and
batter. Many SDFR's don't trust the government or think
they want to take your land away.
3. Lack of Time--Most farm and ranch families have multiple jobs and
responsibilities off the farm, with little time to meet all
the demands of production, marketing, record keeping and
seeking program participation.
4. Lack of Funding--Less staff and less money for programs leads to
more disappointment and erodes trust when qualified farmers
can't get conservation and other benefits.
5. Lack of Faith--Farmers who are tired of getting denials and doubt
any positive outcome will result from efforts to apply for
or seek assistance.
6. Lack of Timely Access to Information--With too many things to do,
and without access to hands on technical assistance and to
technology, SDFR's often miss opportunities to meet
deadlines and access resources. All producers need to know
important dates.
7. Lack of Technical Assistance--Funds for technical assistance do
not come close to meeting the needs of farmers for direct
hands on assistance from qualified Community Based
Organizations and Extension and other University Programs.
8. Lack of Accountability--SDFR's participate in much lower rates in
most USDA programs, and there is still discrimination in
the county offices and at extension offices with no
accountability or consequences.
9. Lack of Representation on County and State Committees, and among
agency and local office staff and leadership means fewer
opportunities to learn the intricacies of programs and to
develop the relations and knowledge necessary to secure
access to critical resources.
10. Lack of Access to and Use of Technology--Broadband, Internet and
Web, and On-Farm Technology are unavailable, too costly,
require advanced skills and/or are too expensive to access.
The following specific issues were also identified by topic area:
(A) Specific Issues Related to Participation in United States
Department of Agriculture (USDA) Programs--The following
were the key issues that needed to be resolved to increase
access to USDA programs:
Equitable Access to Programs--You're supposed to be eligible
for these programsonly to find out that there is no money
left.
If the `person' in the seat doesn't change, you might
change the policy,
but your interests will still not be represented. How
is the person at
USDA Farm Service Agency (FSA) hired?
Broader questions--What programs are we not
participating in USDA
Program?
One producer did not look at USDA ``which could
have been a good re-
source--to make my business venture better--because I
was on the out-
side looking in on the lawsuit.['']
If we had a community based organization--if
there was access to
funding for one--that would have been a really great
tool--now you
have a diminishing resource in USDA--not enough to
help me.
Even now when I can get through the process
myself--do I want to be
encumbered with this USDA. I am a small ranch I am in
competition
with the big ones--not saying I am wasting time
here--I need to be
preparing my land--and all the things I need to do as
a small farm.
Time is a factor of what we need--for USDA and
outreach, we have to
take away time from our work.
Funding cuts have led to Agency starvation--if
they don't have the
staff to reach everyone, the staff is drawn to one
10,000 acre contract--
don't care about small landowners--not smaller one--
agencies starved
for years down. In one southern state there used to
be four district con-
servations and there now only two with only one for
outreach.
Community based organizations are understaffed
and over worked and
outreach grants are hard to get than others.
County committee representation--don't even know
what it is? Lack of
information--what do we mean by representation? If
you are not mem-
bers on the local boards--you don't know ahead of
time--need to in-
crease participation on USDA boards and committees--
but farmers
have to give up time to do that--it is more
profitable than farming--
didn't know that County Committee members get
reimbursed expenses
and time. Each has 3-5 farmers on county committees--
the farmers
elect them with a mail ballot.
You have to have farm number--someone gave a
farmer a packet but
she didn't know anything about what it was--and put
it to the side.
USDA does not put enough funds in the funding
pools to cover SDFR's
and limited resource producers--so farmers get
disappointed and do not
participate.
Some of the loans require you to put up
everything you own for a loan
that is less than the value of collateral.
New and beginning farmers need someone to help
you, but it is not as
complicated as you think it is--``If you really want
that land--make
three copies of the application and scratch on one.''
Native American (trust) land is leased by white
farmers/ranchers.
Gap in information of what Tribal/trust land is
by other farmers.
Want a person of color (not only white) to help
in FSA office.
Different racial groups are set up against each other.
Important to document the situations you encounter and
hold people ac-
countable.
Why does the disaster funding available for a county
only go to a few
farmers who have the larger land plots?
Increasing Engagement in Partnerships to Expand Participation--
A primary issue is how to get individuals engaged in the
organizations, cooperatives and outreach programs that are
skilled in providing services. If they aren't involved in
that first step of being in the organization, how can we
get them to participate at the USDA level?
Strategies needed to promote involvement at all levels
of engagement (co-
operative, program, Community Based Organizations
(CBO), and USDA).
Partnerships are very important.
More information needed about the USDA programs
and process.
Informational sessions on programs, criteria,
and how to apply.
Sign up for monthly USDA newsletters (Natural
Resources and Cons-
ervation Services (NRCS) will send a hardcopy of the
newsletter to
overcome the absence of internet).
Try to make extension and other outreach
meetings more specific to
make participation more attractive. Advertise topics
that would be of
particular interest to farmers, such as flood relief
during flood.
General updates can also be useful and timely,
changing herbicides,
recommendations, varieties, and keep updated.
Conduct USDA survey of SDFRs (``empowered
data'') to better under-
stand lack of participation--Could be done by SDFRs
Policy Research
Center.
Importance of Achieving Results in Outreach and Service by
USDA: One farmer noted ``I've been coming to these meetings
for years and nothing is getting better.'' He got on a
program that asked him to put in a pond but he hasn't heard
from them since. He's never seen Black people there. People
that are farming in other areas are getting help, he's
saying he's not getting help with his livestock. He caught
a little help for with some stuff . . . $1,200 for tree
removal for under 4" trees, but only some acres. Still
needs 70 acres cleared, and they wouldn't cover bigger
stuff.
Increasing Lack of Technical Assistance: Reduced resources for
outreach leads to fewer experienced and dedicated staff
with USDA, the 1890's, and CBO's to assist producers. This
leads to less onsite assistance to help you directly on
your farm and no follow-up to help you sign up. There is an
urgent need for experienced assistance in resolving
eligibility issues--such as Heir Property/New and beginning
farmers also don't know how to participate.
Strategies: Producers need direct hands on assistance
to get farm and tract number and resolve eligibility
issues.
Reallocation of Bases and Yields: SDFR's receive lower
commodity and disaster payments because these they have
historically lower bases and yields that emerge from
decades of discrimination. Farmers are paid based on their
allotted acreage. The amount of acreage considered your
base or average is determined by the determination of the
FSA County Committee through the ``Quantified Base Law'',
and can only be overturned by Congress. This law--dating to
1985--says the local committee is to determine what your
``base acreage'' is, and that amount is fixed, no matter
how much more you are producing!
Strategies: Seek statutory changes (in the farm bill)
to require a catch-up reallocation of bases and yields
and a process to allow SDFR's to re-establish their
bases and yields to fairly and accurately reflect
current acreage base and yield.
Representation on FSA County Committees--SDFR's are
Underrepresented on Farm Service Agency (FSA) County
Committees and not there when information on programs is
shared and decisions on providing disaster assistance,
adjusting base acreage and many other issues related to
commodity programs. Any farmer can run in the county for
the usually 3-member committee and their expenses are
covered. There are also Minority Advisors who do not have
to run for election but are appointed. Minority Advisors
are not paid and not always allowed to take part in the
decision making.
Making Changes in the Farm Bill--How do our concerns to the Ag.
Committee on the Hill and in the Farm Bill? The Policy
Research Center does not lobby but can conduct research and
develop a strategy to implement policy. The CBO's have a
long history of work on policy and ``we are going to the
hill.'' We can all be advocates and need to engage more
farmers on advocacy. The need for more basic education on
the Farm Bill was identified including a one page paper on
what the farm bill does.
(B) Specific Issues Related to Heir Property--The following were the
key issues that needed to be addressed to restore access to
programs for producers lacking clear title or lease on the
land they farm or seek to farm:
Heir Property: If you have land but there is no will or
document saying who will be the administrator of it, your
ability to administer and use it is very difficult. If
there is not an administrator for the land, you will not be
able to get a loan through the USDA. For example, when you
want to take out a loan, but you are the beneficiary of
land along with your siblings--you have to get all other
siblings to sign on to your loan. You will end up in a case
with the bank and your siblings to settle your claim
interest in the land. Speculators will seek out one or two
siblings to see if they can buy them out, then they can
petition the courts for the full property to be sold.
Called a ``speculating interest'' in the land to cause land
loss. You get a minimal amount of the value of that land.
Arkansas' law has changed--the Uniform Partition of Heirs
Property Act allows an heir who is a co-owner to buy out
another who wants to sell their share of a property at the
market value of the property.\1\
---------------------------------------------------------------------------
\1\ In addition to Arkansas; Alabama, Connecticut, Georgia,
Montana, Nevada, New Mexico and Texas have adopted versions of the
Uniform Partition of Heirs Property Act (http://www.uniformlaws.org/
shared/docs/partition%20of%20heirs%20property/uphpa_final_10.pdf).
Bills to enact the law have also been introduced in the District of
Columbia, Mississippi, and Missouri in 2017. A draft bill being shopped
to additional state legislatures by the nonprofit Uniform Law
Commission (http://www.uniformlawcommission.com/) to make it easier to
divide property and preserve family wealth as the owners multiply over
generations.
Adverse Possession is also used by white farmers, investors and
property owners to take land. They pay property taxes and
take ownership, even where there are not heir property
issues. For example, an African American woman rented her
land to a white farmer and as part of the rent he paid her
taxes for 5 years. One year he did not pay rent and told he
---------------------------------------------------------------------------
did not owe it because now he owned the land.
Strategies: Get more protections in place for
African-American families. A lot of risk factors that
can result in land loss--need to address them
comprehensively.
Key point: There is a systemic lack of access to information
and resources to resolve heir property issues--We see a
great deal of land that is idle, land that could be
productive but isn't. The legal risk varies from state to
state. In some states, someone can seize rights to a
property simply by paying delinquent taxes. The time in
which one is considered to have relinquished their rights
to their land varies by state. There was a provision in the
2014 Farm Bill to help get Black farmers' land back; but it
didn't go anywhere. We need new support for education on
wills and estate planning.
(C) Specific Issues Related to Technology Adoption and Usage--The
following were the key problems identified with respect to
technology:
Internet Services are Lacking.
There is limited access to technology.
Producers have not had access to usage of technology
in agricultural pro-
duction and management.
Additional issues raised:
How can technology be used to make it easier for
farmers to accept EBT
(SNAP) payments? EBT payments total over $66 billion--
that is a large
customer base kept from the growers. Individuals should
be able to come
straight to your farm to purchase fresh products from
you.
Need more of all types of technology--Electronic,
wireless, or solar and
on farm.
Not using solar energy or biofuel the way that we
should.
Access to electronic technology among rural/SDFRs (may
be stuck in own
ways at age 55+) and illiterate in how to use computer
even if they had
one address.
Lack of access to internet, cell phone, etc.,
particularly for elderly farm-
ers.
High cost for necessary internet speed and limited
access to information,
computers, and emails--encourage travel to library or
McDonalds to use
WiFi.
Lack of technology limits ability to do bookkeeping or
taxes.
We need more and better outreach for available
trainings on SAMS and
Small Business Administration.
If your password is expired, the government will
kick out any grant
proposals.
Many advantages, but can be frustrating if you
don't know where to
go for the training.
Renew registration once every year and password
every 60 days.
Have to go to many different agencies for
different types of training
(tedious).
Need increased access to equipment including
technology to purchase for
educational purposes or cooperatives. For example:
Presbyterian and
Methodist Churches give grants ($20,000-$25,000) for
SDFRs/and Indige-
nous Farmers and Ranchers. Use these funds for
equipment or match.
(Under $5,000 can count as office supplies).
Reiteration of importance [o]f creating Farmers[']
Market to generate in-
come and obtain SNAP payments.
However--Banks and other actors are getting part
of the SNAP pay-
ments--misconceptions exist about who is actually
getting the money.
(D) Specific Issues Related to Access to Resources and Knowledge--
The following were the key issues identified with respect
to access to Resources and Knowledge:
Local colleges and universities are a great resource
for knowledge, train-
ing, and assistance, as are Community Based
Organizations = but need
more funding and more programs for outreach and
technical assistance
for SDFRs and better and different outreach efforts to
bridge the gaps in
the lack of internet, technology, and computers.
Support is needed for urban area hubs and more grocery
stores in urban
communities.
Provide more funds and more NRCS Technical Service
Providers (TSP's)
to serve DFR's. TSP's go out to farms and help put
together plans for
farmers for practices and tech that NRCS will then help
pay for. NRCS
also helps with practices such as water troughs, row
crops, soil testing
and herbicides. A lot of farmers don't know about
TSP's. We need more
TSP's--farmers can't be bashful about coming in to get
these services.
There is a lack of access to technology and training
for organic agri-
culture for SDFRs Many farmers know of organic but are
unaware of
what it entails and are unsure of the different terms .
. . organic, nat-
ural, pesticide free, etc. Need education on what is
best for markets that
you have access too. For example, it is possible to get
certified organic
for a few years and sell at a farmers' market and then
gain the trust of
your customers, stop doing the certification but keep
your practices?
Information is shared with large scale corporations or
agribusinesses--
SDFRs should have access to those same marketing
strategies.
Access to biofuel technology.
Reduce the carbon footprint and help farmers save
money.
Snail mail is not obsolete.
(E) Specific Issues Related to Access to Grants--The following
issues arose in several groups related to improving access
to grants.
Federal grants are for organizations/entities (not
individuals).
Continue and expand mandatory funding for Outreach and
Assistance to
Socially Disadvantaged and Veteran Farmers and Ranchers
(2501) pro-
gram and increase its maximum ([to] not less than $20
million but pref-
erably $50 million annually. Policy Research Center
should prepare a
briefing paper that shows what has been done with the
current funding
to show and the other good we can do with more money.
This will help
CBO's and others working on the hill to show how
funding for more pro-
grams will help more people. The limit of only one year
of funding is a
great barrier--business plans are usually 5 years. Add
statutory author-
ity or a requirement to provide multi-year funding.
Important to learn how to use grants.gov--USDA
agencies must list all
the grants available as do other Federal Government
departments. Also,
you can sign-up on USDA agency websites to receive
regular news re-
leases from various USDA agencies (NIFA, NRCS, RD, AMS,
as well as
USDA Office of Advocacy and Outreach) to get
notification of when grant
cycles are open.
Grants can only be used by the specific types of
organizations listed and
the money may come delayed a few years (proposals don't
mean that you
were awarded funding).
Specialty Crop Block Grants will fund provide multi-
year funding for 2-
3 years. These are Federal funds administered by the
states--Look at
state agriculture department for grant cycles and
specialty crop priority
lists.
Repeated Denials of Grant Applications: Grant proposals are
con-
tinually denied (for 3 years or more), while the
reasons for denial con-
tinue to change.
Strategies: Ask agency to share reviews from
reviewers, and to tell you if any part of the
grant application was missing or incorrect.
Request to see a past successfully funded
grant.
Develop a relationship with your Congressional office and
ask your
Representative or Senator to put pressure on agency to
fund it. Before
you apply, apply to be a reviewer of the grant round
and learn the ele-
ments of proposals that lead to positive reviews.
For proposals, which is most important for policy:
internet/satellite
services or agriculture technology? (These are of equal
value, need both
types of technology so there should be no separation
between the two).
(F) Specific Issues Related to Discrimination and the Pigford Claims
Process--A fuller examination needs to be conducted on the
issues and impact related to the Pigford Discrimination
Claims process through the Policy Research Center.
Producers were supposed to get three things:
Compensation of $50,000 (or
more in other Tiers), Debt relief and Priority access
to services, including
inventory land.
But the producers who were successful in the claims
process only got
funding and the $50,000 in no way compensated for their
losses and most
farmers didn't even get that. Only the lawyers
benefitted. Very few suc-
cessful claimants (only about 3%) received promised
debt relief; even then
the loan was forgiven only for a year. Many farmers are
still going out
of business even with a settlement from Pigford,
because their debts are
so high because of the penalties and interest they have
accrued on their
loans from private banks (because the USDA
discriminated against them
and wouldn't give them USDA loans).
Under Category 3 of the Pigford Process, which was
supposed to provide
priority access to future programs, including to land
in inventory, no one
got inventory land. There is no evidence that there has
been any in-
creased priority to programs.
We need to secure support in the farm bill for
research to show we have
not taken care of the Black farmer problem.
(G) Specific Issues Related to Rural Development (RD)--We also need
to address the need for environmental and social justice.
We need to address this in the small communities, like the
small delta communities with water problems and sewer
problems. We need to target funds to address these issues.
III. Solutions: Building Resourceful and Ready Farmers and Communities
The following were the proposals from the group related to solution
that we can implement on our own without policy changes:
A. Do What We Can Ourselves: Build Knowledge and Education of
Socially Disadvantaged Farmers and Ranchers (SDFR's)--We
need to recognize that resources are likely not coming back
and we need to take matters into our own hands. It is
important that we all work to increase recognition of
importance of farmers in communities.
(1) Increase Knowledge--You have to be able to fill out the
application your-
self with the help of the internet--we have to move
into the 21st century.
``I know how to use the cell phone and the computer--
you can talk to the
phone. Use appropriate technology--get your 10 year old
granddaughter
to help.''
First step--you have to visit USDA--you have to get
a Farm Number,
you have to get a farm track, you have to get a map
and you need to
show proof of ownership--a deed or a lease. You've
got to have this
stuff when you go to FSA or when you need to have a
conservation plan
with NRCS.
Go and ask them what you got to have--when you go
with nothing and
you don't know nothing--you get nothing. If you asked
the right ques-
tions and have the right stuff they can give you what
you ask for.
How long does the lease have to be? Different
amounts of time are
needed for different programs.
We each need to be responsible to know what is
available.
Join different organizations/associations to
expand the types of infor-
mation you are hearing (join the white groups to
hear the informa-
tion first).
Participating in USDA programs--You can self-certify
yourself. You
need to be sure the land you are on fits the program
and to document
ownership or control of the land. That is part of the
eligibility thing--
we need to work on getting eligible. In Oklahoma,
based on the reports
from NRCS, Black farmers only get 2% of the allocated
funds. If you
apply and learn you are not legally eligible to
participate--you have 30
days to reply[.]
(2) Timeliness--We need to know about program opportunities in a
timely
way--when are sign up periods? Get on mailing lists of
agencies, CBO's
and Extension to find out.
(3) Get Farmers Involved with their Community Based
Organizations and
Cooperatives, and then with USDA Programs.
Most farmers who have a problem will go to their
local CBOs. We want
to keep the engagement effort local. We work with
individuals to make
sure they are thoroughly prepared, and if they still
have needs/con-
cerns/questions about the process, we go with them!
Provide workshop for groups of producers to get
ready to effectively
apply for and use USDA programs.
Make sure our farmers know who and where there USDA
reps are.
Use the Natural Resources and Conservation Service
Conservation In-
novation Grant (CIG) Program to educate and
demonstrate conserva-
tion practices to farmers.
Remember that USDA and Extension service are paid to
serve you. Use
them. The 1890 colleges can help producers to
complete applications.
(4) Learn how to apply and quality for programs--We further need
to learn
when, where and how to sign up. We also need to come up
with construc-
tive solutions to address barriers we find--this will
increase participa
tion.
Get on Extension Mailing List.
Work with CBO's that provide hands on assistance in
your area.
Keep Calling and Following Up--develop motivation
and perseverance.
Everyone needs to get a Farm number!
Get Receipt for Service every time you go to
office--it is your right.
Participate in Census of Agriculture.
Keep Track of taxes and Complete your Schedule F.
Build relationships.
(5) Hold Agencies Accountable to Serve You--You should expect
quality serv-
ice and do not need to accept discrimination.
Be visible to the USDA. (They are being paid to
serve you.)
Document activities, and keep records/receipts of
service (USDA is re-
quired to give you a receipt for service).
Appeal decisions that you do not like.
Hold the agencies accountable by filing reports and
taking action. Go
to higher ups.
Seek assistance from CBO's and 1890's if you need
it.
(6) Participate in Programs and on Boards and Committees and
Share What
You Learn.
There is always a farmer in your community who knows
how to partici-
pate. You should find that person to help you. Anyone
who gets into
a program should reach out and help someone else.
Farmers who enter programs should commit to serving
as mentors to
others.
Producers should consider joining other farm
organizations working
with white farmers. Join organizations that have
information you can
use, whether or not they are mostly white. Don't
stereotype yourself
and limit yourself to Black organizations. The white
organizations are
going to find out what's out there and what's going
on before we ever
do. We have to make ourselves more visible.
We need to work together to increase representation
on USDA Boards
and Committees.
We need to run for and get on FSA County Committees
and Conserva-
tion District Boards and participate on NRCS State
Technical Commit-
tees. Work with CBO's to learn how to run and to get
support from
other farmers and convince them to vote. Many County
Committee
members are elected with a small number of votes.
(7) If You Encounter Discrimination--Take Immediate Action--
Discrimina-
tion is still happening. If you feel someone is
discriminating against you,
the smartest thing to do may not be to get in their
face and cause a
scene, but rather go to their boss. The GSA's do not
want to lose their
jobs.
B. Improve Access to USDA Programs--More program support and hands
on assistance is needed.
Reform agency approach to reaching farmers so that more
people are
knowledgeable of programs and able to access them.
Transparency and Ac
countability requirements must also be met. Employee
performance must
include indicators on success in including SDFR's.
More funds for 2501 and to support the CBO's that
provide hands on as
sistance.
Increase access and availability of technical service
providers (TSP's) that
come from our communities--train them to address the key
issues to assure
producers can become eligible for the programs.
Extension agents need to go out more to field and reach
SDFR's.
Organize farm tours so farmers and ranchers can meet
each other.
Focus more outreach to women because men tend to be more
reluctant to
go to meetings.
C. Address Black Land Loss and Heir Property Issues--Secure more
protections for African-American families to hold on to and
utilize land. Family members fight over money, it's just
what they do.
A will is essential--without one ``You have to go to
court and the lawyers
says sell it, and everyone gets like $2000 because
there's so many people
in family and lawyers take a cut.''
More training and technical assistance on wills and
agreements should be
provided to help families resolve heir property issues
and to prevent forced
partition sales by outside investors who approach
absentee owners. There
needs to be a program on succession planning and
education and wills.
Policy Research Center should do a matrix on property
laws on the 18
states it serves.
Learn how other families have handled this issue. For
example, one family
has a provision in the will that says they can only send
the land to someone
else in the family.
General reform of approach, because current approach
isn't working.
D. Improve Access to and Use of Technology--Internet gives you
information, farming technology lets you apply it. Farmers
need both types of technology. Technology on the farm will
improve your operations--it is growing and will continue to
grow.
We can develop the technology to make biofuels on the
farm to reduce your
energy costs--I can make it and I know you can make it.
You can transfer
this knowledge to others.
We can also make use of hydroponics and aquaponics.
Many farming operations are now so high tech, with
global positioning and
access on information on soil quality and moisture.
Irrigation can be done
with remote computer access and access to the internet.
Drones can be used
in farming.
Create a brand and get a market first.
We need to promote more support, training and sharing on
use of these
technologies.
E. Build Communications, Partnerships, Opportunities, Pathways--USDA
agencies are moving more into computer age--we can't afford
to be left behind.
All farmers need to learn to use the computer and phone
and ways to get
into programs that don't require going to offices.
Develop skills and partnerships (esp. with young
people) to use internet
and phones to find and share Information
To address the issue of lack of access to information
(ex. Agriculture Census
or process/criteria for USDA programs):
Groups should develop and share a list that would
show the type of issue
(ex. need for equipment) and then the types of grants
and resources avail-
able to address that issue (e.g., grants from the
Methodist church)
Seek grants for technology transfer--we should
work for greater partici-
pation in grant programs and more participation by us
on the review
committees.
Get a group of farmers together--let the college
speak to you and help
you get the knowledge together--on one specific
program--$6 million
more went out to farmers due to educational efforts.
In reference to knowledge--it is important--how to
streamline the
knowledge--not a check box--streamline workshops that
actually provide
SDFR with tools--line by line assistance. We need a new
toolbox.
Provide more education on the 2501 program and learn
where and how the
2501 funds are appropriated and how to support more
funds.
Provide organic standards education and assure organic
research completed
by universities is shared with farmers.
Be sure to understand and meet Food Safety and
Modernization Act Stand-
ards for food we ingest--the 1890's have training
programs.
Learn how to use rural development programs.
Recognize the critical importance of support so the
community based orga-
nizations can bring the agencies to the communities
rather than bringing
the communities to the agencies.
Improve Access to Grant Funds--Use relationship
building to expand ho-
rizons.
Takes time to get your name out there and win a
proposal.
Try new tactics with every Administration because
the same strategies
don't always work.
Organize Black veteran farmers under us to get the
funding for veteran
farmers.
Utilize Farmers['] Markets--It is critical to seize the
opportunities pre-
sented in farmers['] markets.
Be sure the high level of spending at farmers[']
markets can be accessed
by all farmers and communities (e.g., Socially
Disadvantaged Commu-
nities).
Access Technology to accept SNAP Benefits at
Farmers['] Markets.
Build Partnerships and Networks--Everyone needs to be
retrained in part-
nerships and communication with each other to strengthen
our bonds of
working together. We have to work together--African
American, Latino,
and American Indian farmers and ranchers.
Need to persevere and take the time to build
relationships.
We must build accountability in partnerships.
Expand community based relationships with 1890
institutions.
At Langston University: Animal Science Boot camps
were created to fos-
ter collaboration between the two groups.
USDA retirees who have a vast amount of knowledge
of the programs
should be tapped resources for SDFRs.
F. Grow A New Generation of Farmers--We need youth component that
educates young people on land/agriculture.
We need to educate our kids about farming to break
stereotypes and mis-
conceptions the younger generation has about farming--
that it's dirty, etc.
You have to show the value of farming (the economic
advantages) and also
that there are other opportunities, such as production
agriculture. We need
more people that are involved in forestry and production
agriculture, and
animal science.
Organize Younger Farm Associations and Chapters and have
regular meet-
ings. These are good resources for information. We have
one once a month
and invite the NCRS.
Urban farming youth outreach has been successful--There
is an agricul-
tural high school in Chicago.
Build and strengthen partnerships and communication
networks to effec-
tively and actively capture the skill sets of all age
groups and participants.
Engage existing producers as mentors, and younger
generation to help with
electronic access.
There is a youth loan program in the existing bill, we
need to keep that.
USDA has a youth loan (FSA youth loan can borrow up to
$5,000) for any
project that is agricultural-related. But you don't want
kids getting the
money for their parents. Need to get parents that are
interested in youth
programs. A lot of people don't know about this program.
We need to think outside the box of focusing on people
going to FSA, if you
want to get this information to youth who are not
connected to FSA list;
to make it more accessible to others.
How about going after establishing a teaching farm?
There are Federal and
state/local grants for these. This is a way to do youth
outreach and edu-
cation (debunk myths about farming), while securing
another stream of rev-
enue, and cultivating the next generation of farmers.
There are several
models of this that also teach entrepreneurship and allow
new farmers to
get a farm number and gain the experience they need to
qualify for pro-
grams in the future.
IV. Policy Proposals for Statutory and Administrative Change
The group identified several specific proposals for Statutory
Change (by the U.S. Congress in the farm bill or at the state Level)
and/or Administrative Change (made in regulations or procedures by USDA
agencies).
(1) Strengthen and Secure More Funding for 2501 Outreach and
Assistance for Socially Disadvantaged Farmers and Veteran
and Ranchers (OASDVFR)--A top priority identified was the
need to greatly expand funding for the historic 2501
Program to at least the $20 million annual level in direct
funds provided in the 2008 Farm Bill. A level of $50
million annually would much better meet needs. Language
should also be included to specify that ``funds should
remain available until expended'' to provide clear
authority for multi-year grants of at least 3 years. Both
of these changes must be made in the farm bill. The move to
3 year grants would also require a subsequent change by
USDA to allow or move to a preference for 3 year grants.
Another administrative change would involve requiring a
peer review process to include CBO's and Minority Serving
Institutions.
(2) Secure Authority, Process and Action to Enable Producers to Re-
establish Base Acres and Yields--SDFR's should be allowed
to re-establish bases and yields to reflect their current
production. (Statutory Change Needed in Farm Bill).
(3) Require Full Implementation of Transparency and Accountability
provisions from Section 10708 of the 2008 Farm Bill--Set
clear targets and timelines for public reports on program
applications and participation by race, ethnicity and
gender to the county level-review participation compared to
targets and publish reports on whether these are met.
Language should also require the data from these reports be
used in personnel evaluations, and for regular civil rights
compliance reviews, with findings made public. (Could be
done with Administrative Action, but changes are needed
because it has not been--need Congressional Oversight and
Stronger Statutory Requirements).
(4) Require Periodic Audits of County Committee Actions--There needs
to be a periodic review of how FSA County Committees make
decisions and how well they serve all farmers. Are
decisions fair and according to policy? Are outreach
responsibilities met? How is disaster assistance allocated?
How has participation by race, gender and ethnic changed?
(5) Expand and Increase Set Asides of Funding in NRCS Programs--Set
asides should be increased to 15[%] or 20% of funds. USDA
should be required to implement set Asides as floors not
ceilings. Unused funds should be redirected to the national
level to redistribute to areas with more SDFR's. (Expansion
requires Statutory Change in Farm Bill). Expand TSP
(technical support programs) to include outreach division
and increase support (or include a set aside) for TSP's
qualified to serve SDFR's.
(6) Increase Funding, Access and Set Asides in Various Programs:
Secure more funding for organic training, improve access
to this training,
enact set asides of 10-15% for SDFRs farmers and
ranchers.
Consider Set Asides in additional programs, including
grant programs.
(7) Enable Active Producers to Access Federal Farm Programs for Use
on Heir Property--Seek statutory authority (in farm bill)
to enable farmers to utilize Federal farm programs for land
management and production including:
Secure Waiver of eligibility restrictions to allow farm
operators who have
5-10 year production and Schedule F tax history, but are
not the adminis-
trator, to be eligible for conservation programs, EQIP,
forestry and other
services on all of the land (i.e., a 5 year or 7 year
contract on a CSP).
Work to new secure lease-back and buy back provisions to
help get Black
Farmers and SDFR get land back.
Establish new authority within existing Farm Ownership
Loan Programs,
or a new Loan Program with authority for low interest
farm ownership
loans to families to resolve heir property issues by
buying out other heirs
(model these on programs in the 2008 and 2014 Farm Bill
that provided a
lending program to allow Tribes and then individual
Native American
Farmers to access loans to resolve fractionated land
issues).
Research additional ways to build incentives for heirs
to allow land man-
agement and production on the property. The time in which
one is consid-
ered to have relinquished their rights to their land
varies by state. Laws
relating to adverse possession also vary. Review state
laws and recent
changes for best models.
(8) Access to Programs for New and Beginning Farmers Seeking to Farm
on Heir Property
Adjust criteria so heir property waiver could apply on a
farm with a history
of being farmed and that the waiver would apply to
whoever is currently
operating the land.
Restore SDFR priority access to land in inventory with
FSA, along with be-
ginning farmers and ranchers.
(9) Expand Youth Programs in the Farm Bill--Incorporate more
provisions to benefit youth and young farmers into farm
bill, including expansion of the FSA youth loan. Allow more
organizations and CBO's who serve youth to be able to
access youth education programs funds.
(10) Farm Credit--Include language to provide exemptions for SDFR's
eligible that now allow Limited Resource Farmers to access
FSA loan programs without providing two letters of denial
from banks.
(11) Protect and Increase support for Rural Cooperative and Business
Development Program and Funding--Consider Additional Set
Asides for SDFR's.
(12) Support Urban Agriculture Policy and Programs--Be sure they
complement and work with other programs for SDFR's and do
not compete with them or simply expand benefits for
suburban and wealthier farmers.
(13) Support More Funding for the Beginning Farmer Development
Program--Be sure set-asides for Socially Disadvantaged and
Veteran Farmers are sufficient, possibly with priority to
those who meet both categories. Eliminate matching
requirements. Maintain ``just in time'' application process
so some documents are on required once you win a grant.
(14) Develop New Policy and Programs to Encourage Partnerships and
Cooperatives among SDFRs to increase access to technology,
information, and equipment.
Help beginning farmers to stay in business.
Bridge gap in access to technology and technique.
Foster mentorship among different age groups (i.e.,
senior age farmers ex-
perienced in farming with youth skilled in technology
use).
Reciprocal mentorship program.
Bridge gaps (as seen above).
Shares skillsets among different age groups (i.e.,
younger generation
better with technology while older generations know
techniques).
(15) In Extension, FSA, NRCS, etc.--increase authority and support
for outreach grants to provide trainings in partnerships
with 1890's and CBO's.
White farmers have relied on the 1862 land-grant
institutions and USDA
service centers for service center (African-American
farmers are not present
at these training sessions hosted at the institutions).
Provide 1890 institutions and CBO's similar
opportunities/funding to pro-
mote participation.
(16) Provide New Funding and Authority for the National Agriculture
Statistic Service to expand what is counted in the Census
of Agriculture and other studies does. Data should be
collected on land ownership--not just farms. This will help
us to put a strategy in place to effectively deliver funds
allocated. (Also consider requirements for Economic
Research Service Reports and Studies).
(17) Include a Farm Bill Provision (as a last-minute amendment) to
authorize funds for a Review of the Pigford Claims process
and its Impact on Black Farmers.
(18) Support passage of Uniform Partition of Heir Property Act in
more states? (Mentioned but not officially proposed)--
Request CBO's in states with the law to share experience
with the law and recommend if it should be enacted
elsewhere or changed in any way: http://
www.uniformlaws.org/Act.aspx?title=Partition%20of%20Heirs%20
Property%20Act.
V. Proposals on Strategy
Conduct Research--We need more comprehensive studies on
SDFRs, to learn more about the reasons they are not
participating in USDA programs. Conducting a more comprehensive
study of a larger sample pool would provide data that we could
then take to USDA headquarters to show what the ``masses'' are
saying. The Policy Research Center is working on this.
Report on Pigford--One group proposed that the Policy
Research Center take a deeper look and prepare a report on the
Pigford Claims process. There needs to be a clean and
comprehensive research project. More than $2 billion was spent
to resolve the claims, so there is nothing wrong with spending
$5-$6 million to conduct a study that evaluates the impact of
Pigford on the Black farming community
Expand grants for outreach education--More support for
Outreach is needed.
There are grants for this, but they aren't easy to
get. Maybe if the 1890s institutions were given funds for
this, there would be more participation among SFDRs. We
should give these institutions money to do this.
We need `retraining' and `partnership education.' Need
to stay on the 1890s institutions, to ensure that they
remain aware of CBO's and their needs.
Farm Bill Information and Strategies--How can we change farm
bill if we don't know what it is? We need more information on
what is in it and how it helps farmers.
Important to increase participation--and support--of
Community Based Organizations to build grassroots power in
the policy debates. CBO's have worked effectively on the
hill for many years and we to benefit from this experience
to work together to do so again.
With respect to the upcoming debate on renewing the
Farm Bill (2018)--if something is positive we need to keep
it. If it's negative get rid of it. We need to start
working now because the time for input is now.
We should focus on some specific policies to laser in
on for farm bill.
We should work with the Congressional Black Caucus to
prepare and have them add amendments at the last moment
because Congress needs their support to get the full bill
passed.
The Jackson-Lewis study done for USDA has
recommendations on 2501 and other issues that the USDA
doesn't want to do. We should include these in our analysis
of policy issues for action.
Develop and Use Mentor Farms--We can learn from doing versus
simply reading about farming best practices.
Use teaching or mentor farms to educate new farmers.
Several CBO's have or are developing mentor farm operations
with various structures. The optimal models allow the
incoming producers to gain both the skills and experience
necessary to qualify for USDA programs. This includes the
opportunity to have control of a piece of land and to get a
farm number.
To find a list of 1890s institutions that offer model
farms on the USDA site, search for `1890s'. They have
`Field Days' where they do demos of model farms.
VI. Conclusion
The following were the closing recommendations of the group at the
final session, which was led by Mr. Tillman.
Grow the Next Generation of Producers--Support the next generation
of African American and other SDFR's.
Assure the next generation of farmers are involved in future
meetings.
Build youth education on farming to break stereotypes and
misconceptions.
Speak about the plight of farmers (Black farmers and
southern farmers).
Increase opportunity in production agriculture.
Better relationship between USDA and farmer.
Engage Everyone in Improving the Farm Bill--Recommendations
included the following:
Prepare a one page handout of what the farm bill is.
We are going to the Hill.
Funding of 2501 program and Policy Research Center (for next
5 years).
New Measures to Assure Accountability of service.
Incorporate and expand youth programs and support in the
farm bill (expand USDA youth loan and mentoring programs).
Prepare the next generation to continue the fight.
Increase support in the farm bill for workshops and other
training sessions.
Increase the Capacity of Community-Based Organizations--Community-
Based Organizations provide critical training and assistance.
Increase support and participation of community-based
organizations.
Training for CBO leaders to engage farmers in agriculture
and policy.
3. Issues Related to Farm Credit and Guaranteed Loans
Rural Coalition Letter to the General Accounting Office (GAO)
regarding Sec. 5416. GAO Report on Credit Service to Socially
Disadvantaged Farmers and Ranchers, Washington, D.C., March 3, 2021.*
---------------------------------------------------------------------------
* Editor's note: the letter is dated March 3, 2019. It has been
published herein as received.
---------------------------------------------------------------------------
Farm Credit Administration response to a farmer following a request
for assistance with a complaint, December 18, 2014. [Attachment 1].
Rural Coalition Letter to the Farm Credit Administration requesting
information on assuring protections under the Equal Credit Opportunity
Act, December 19, 2014; farmer name redacted. [Attachment 2].
March 3, 2019
Hon. Gene L. Dodaro,
Comptroller General,
U.S. [Government Accountability] Office,
Washington, D.C.
Re: Sec. 5416. GAO Report on Credit Service to Socially Disadvantaged
Farmers and Ranchers
Dear General Dodaro:
I. Introduction
As the [Government Accountability] Office prepares to fulfill its
duties under Section 5416 of Public Law 115-334, the 2018 Farm Bill,
the undersigned organizations representing the agriculture lending
interests of minority and socially disadvantaged farmers and ranchers
encourage the adoption of methodologies that examine and evaluate farm
lending policies having a negative impact on minority farmers and
ranchers. The study's methodology should examine, from our perspective,
and evaluate certain ``unique'' lending patterns, practices and
policies that reliable sources, academic and legal, verifiably document
as contributors to farm loan default, acceleration and foreclosure
within the minority farming community.
The undersigned organizations over the years have reviewed
thousands of loan documents, and assisted minority farmers with loan
servicing options. Before and after Keepseagle, Love, and Garcia,
Pigford Farmer settlements, the undersigned organization labored with
minority and socially disadvantaged family farmers and ranchers in the
areas of farm credit applications, collateral requirements, and loan
servicing. As a collective of over 100 years of experience in family
farm foreclosure prevention and farm wealth transition, we know
firsthand the consequences of late loans, disparate treatment and
disparate impact in loan servicing and other hidden farming lending
discriminatory policies and procedures. A history of loan service to
our farmers gives us the knowledge and credibility to offer suggestions
that will accommodate efforts to determine other appropriate details of
the study's methodology. As you develop a methodology to gather and
organize reliable report data to present to the House and Senate
Agriculture Committee, consider farm loan practices from our practical
and historical perspective.
As delineated herein, our methodology suggestions find general
acceptance in 7 U.S.C. 1983c which authorized the Secretary of
Agriculture to implement pilot loan programs when there is a finding of
loan program irregularities. This study is much needed as it will point
out farm lending irregularities for the purpose of improving credit for
all farmers. Farmers appreciate the fact that the legislative language
mandates a product completion within 120 days of December 18, 1018, the
execution date of the 2018 Farm bill.
II. Legislative Requirements
The statutory language requiring of the study is general and
purposely vague. We point out the vagueness of the language, not as a
criticism, but to augment the necessity of a broader methodology that
captures real irregularities faced by minority farm borrowers.
Essentially, Section 5416. of Title V of the 2018 Farm Bill
requires the Comptroller General of the United States to conduct a
study to (A) assess the credit and related services provided by
agricultural credit providers to socially disadvantaged farmers and
ranchers; (B) to review the overall participation of socially
disadvantaged farmers and ranchers in the services described in
subparagraph (A); and (C) to identify barriers that limit the
availability of agricultural credit to socially disadvantaged farmers
and ranchers. Title 5416, Sec. 5416 of Public Law 115-334.
The language's general reference to terms like access,
participation rates and barriers by implication suggests that the
functionality of the methodology encompasses the time, place, manner of
access, and foreclosures that may violate Federal laws if the
irregularities are found to be within the consumer protection
prohibitions of statutes like the Equal Credit Opportunity Act (ECOA)--
15 U.S.C. 1691-1691f, Fair Housing Act (FHA)--42 U.S.C. 3601-3631; Dodd
Frank Unfair Deceptive and Abusive Practices Act (UDAP)--12 U.S.C.
Section 5531(d).
Even though not specifically mentioned, it is permissible that the
study's methodology must be comprehensive to the extent that access,
participation and barriers will be quantitatively and qualitatively
articulated by examining or evaluating lending irregularities and
discriminatory practices against relevant regulatory guidance of
relevant consumer protection statutes. If a plain meaning
interpretation of Section 5416 applies without permissible
considerations, the data could be limited to the number of minority
farm loans granted and denied and miss critical data on key issues such
as lending patterns, policies and practices that have a disparate
impact or serve as disparate treatment. Missing the real issues of farm
loan irregularities and discriminatory terms and conditions may cause
further extractions of land wealth from minority farmers while denying
the same or similar viable, economically appropriate lending risk
management tools offered to nonminority farmers and ranchers.
We understand that not every aspect of a farm loan transaction can
be studied. But critical irregularities must be studied. The
Congressional intent of Section 5416 reveals that the results must
inform and guide policy makers and practitioners on how to create
program efficiencies while ensuring fair farm lending.
Reviewing overall farm lending participation rates does not address
associated issues of barriers to participation such as fair and
equitable participation. The fact that a minority farmer participates
in a private or Federal loan program does not automatically equal
meaningful, fair participation. Some farm credit transactions run afoul
of consumer credit statutes and we can attest to such examples evincing
lending irregularities and discrimination. Therefore, participation in
harmful discriminatory lending transactions is more detrimental
economically than straight forward credit denial, especially when the
loan is over collateralized, and a personal residence security interest
is mandated but is unnecessary to secure the loan in question. Minority
farmers understand that agriculture is a high economic risk industry
and their reliance on fairness in credit transactions must be
guaranteed by the lenders offering various credit options.
Farm lending, especially when directed by the government or
guaranteed by the government, should be a consistent and evenly applied
farm risk management toll. In accordance with 7 CFR 1779.63 and 7 CFR
4279.281 the U.S. Department of Agriculture and the Small Business
Administration must make sure that lending irregularities and
discrimination is not a part of any loan guaranteed by the government.
Minority farmers confront the same floods, droughts, and market
fluctuations as nonminority farmers. Inequities and irregularities
within farm lending sector should not be held in the same farm risk
category as natural disasters.
III. Irregular and Discriminatory Lending Practices
The data collected for analysis, under Section 5416, must include
loan transactional components such as (a) excessive collateral
requirements, (b) unwarranted late disbursement of loan funds, (c)
misapplication or calculation of actual or average farm production, (d)
evaluation of loan applications based the association of credit risk
identified with third party non applicants, (e) directing or requiring
borrowers to purchased equipment or inputs from entities related to the
transactional lender, (f) suggesting or requiring underfunded or over
funded annual crop loans with the intent to gravely impact repayment
ability, and (g) denying or forcing loan servicing options that
diminish annual farm operations and loan repayment ability. While not
exhaustive, this list is a compendium of discriminatory or irregular
lending conduct that is prohibited by the Equal Credit Opportunity Act,
the Fair Housing Act, and the Dodd Frank Unfair Deceptive and Abusive
Practices Act. These aspects must be studied.
IV. Develop a Methodology from Applicable Consumer Credit; Civil
Rights; Farm Credit Statutes and Regulations
The goal of this study is to collect data on access to fair credit
since the lack of access to fair credit is the same as a barrier to
credit. We recommend that the study examines 8 (eight) standards.
(a) Effects Test--The Equal Credit Opportunity Act and its
implementing regulations found at 15 U.S.C. 1691, and 12
CFR 1002, Regulation B, may prohibit certain credit
practices that are discriminatory in effect because the
practice or policy has a disproportionately negative impact
on a prohibited basis such as race, age, gender, etc. Under
the effects test, the policy or practice of the creditor
does not have the intent to discriminate. The lending
practice, under the effects test, appears to be neutral on
its face. It is the application of the policy or practice
that presents the irregular, discriminatory disparate
impact or disparate treatment problem for the minority or
socially disadvantaged farmer borrower. For example, the
lender informs nonminority similarly situated farm loan
borrowers on the best and lowest price seed, tractors or
fertilizer. Or the nonminority borrower may get detailed
information on where to find low priced farm land for
rental. In contrast, the minority farmer does not get the
same ``best source to purchase'' advice. Another example is
appropriate as is the ``best source to purchase'' example.
Consider a lender loan requirement specific to the minority
farmer where a refinance of personal residence using a USDA
guaranteed loan is mandatory for the closing of a farm
operating loan. Under the ``effects test'' a disparate
impact problem arises where, in contrast, the nonminority,
similarly situated farm borrower is not required to
refinance his personal residence and or use the personal
residence as collateral for a farm operating loan. It is
easy to see that the minority farmer, in these examples are
subjected to disparate treatment. Granted, some lender
policies or practices will pass muster if it meets a
legitimate business need of the lender that cannot
reasonably be achieved as well by means that are less
disparate in their impact. See Regulation B, 12 CFR Section
1002.2(c), (m), (n), (t) and (z).
(b) Deceptive and Abusive Lending--Although less frequently, a
lender may subject a farm loan borrower to terms and
conditions that are designed to put the farmer out of
business. A farmer may be subjected to coercive tactics
whereby a farmer can be lured into a farm loan that is not
affordable or guaranteed to result in foreclosure. Lender
decisions to such abusive or deceptive tactics in loan
making or terms and conditions may violate the Dodd Frank
Unfair Deceptive and Abusive Practices Act (UDAP). In the
farming area, like other consumer credit, a UDAP claim can
be successful only when the lenders conduct shows the
following: ``(1) materially interferes with the ability of
a consumer to understand a term or condition of a consumer
financial product or service; or (2) takes unreasonable
advantage of--(A) a lack of understanding on the part of
the consumer of the material risks, costs, or conditions of
the product or service; (B) the inability of the consumer
to protect the interests of the consumer in selecting or
using a consumer financial product or service; or (C) the
reasonable reliance by the consumer on a covered person to
act in the interest of the consumer.'' Dodd-Frank Wall
Street Reform and Consumer Protection Act, 12 U.S.C.
Section 5531(d).
(c) Residential Real Estate--In order to obtain a farm operating
loan, a farmer may be required to offer his personal
residence as collateral for such loan. On its face the
offering of a personal residence can be a lender
requirement that is based on the credit risk of the
particular loan. However, Civil Rights statutes and
implementing regulations such as 24 CFR Section 100.130(a)
prohibit a lender from imposing different terms or
conditions for the availability of loans or other financial
assistance because of race where the transaction is secured
by residential real estate. See 42 U.S.C. 3604(b); 24 CFR
Section 100.130(a); and 24 CFR Section 100.130(b)(1)(2)(3).
(d) Excessive Collateral Requirements--Whether minority farmers are
required more frequently than non-minority farmers to
tender excessive collateral in order to receive a farm loan
or to acquire meaningful loan servicing through workout and
loan modifications. See Regulation B, 12 CFR 1002.6(b)(4);
Regulation B 12 CFR 1002.2(n).
(e) Discriminatory Loan Terms and Conditions--Whether minority
farmers more frequently than non-minority farmers receive
loan funds after April of any given crop year. Under the
guidance of 12 C[F]R 1002.6(b)(4) a lender cannot provide
two different systems of credit application, loan pricing
or loan servicing. See Regulation B, 12 CFR 1002.6(b)(4).
(f) Third Party Influence--Whether minority farmer loan application
packages and lending decisions are unduly influenced by
third party entities such as equipment dealers,
agricultural input suppliers and or processors and millers
of raw agricultural products. See Regulation B, 12 CFR
1002.2(c); 12 CFR 1002.4(a)(b); and Unfair Deceptive
Abusive Practices Act_12 U.S.C. Section 5531(d).
(g) Lender Control Over Farmer Operations--Whether farm lender's
more frequently exert control over the daily management of
minority farmer operations in terms of acreage planted and
equipment purchased. Unfair Deceptive Abusive Practices
Act_12 U.S.C. Section 5531(d).
(h) Intentional Lender Mistakes--Whether certain lender decisions
are implemented with intent to cause irreparable damage to
the economic viability of minority farm operations. Unfair
Deceptive Abusive Practices Act--12 U.S.C. Section 5531(d)
(UDAP). We do not infer that every farm loan, whether USDA
Direct or USDA guaranteed, is made and designed with the
intent to defraud or damage the farming operations of
minority operators. But, history and experience,
nevertheless, inform us that such problems like this do
appear occasionally and have the intended effect of causing
harm and failure to minority farmer operations. Again, we
stress that these practices do not happen every day, but
our farmers tell when they exist, and the farmers tell us
when lenders make lending mistakes--intentionally or not.
Having made a compelling argument to the U.S. Congress
during the 2018 Farm Bill debate, the House and Senate
Agriculture Conference Committee, responded proactively to
provide a provision of ``equitable relief'' for farm loan
borrowers in those circumstances where a FSA farm loan
employee makes a mistake--knowingly or unknowingly--and
that mistake causes a borrower to be in noncompliance on a
USDA direct loan. Section 5304 of the 2018 Farm Bill
conference report gives the Secretary of Agriculture the
authority to offer a farm loan borrower a provision of
``equitable relief'' when a decision of a farm loan officer
causes the borrower to be out of compliance with the loan
program. Noncompliance with a loan term or provision can
lead to default, acceleration, and foreclosure. The
``equitable relief'' provisions of Section 5304 are far
afield from the fraud prevention provision of the UDAP. 12
U.S.C. Section 5531(d). Lender mistakes whether intentional
or not will cause economic damage to farm business
operations. We mention the presence of ``equitable relief''
in Section 5304 to highlight the existence of a problem and
the necessity that the GAO study look into irregular
lending practices having a flavor of mistake or fraud. Sec.
5304 of Public Law 115-334.
V. Industry Specific Credit Transactions: Sugar Cane and Contract
Poultry
Although not often implemented by the U.S. Department of
Agriculture, 7 U.S.C. 1983c permits the Secretary of Agriculture to
conduct pilot loan programs in areas of lending irregularities, such as
those endemic to industries such as contract poultry and sugar cane
production. The existence of pilot loan programs under 7 U.S.C. 1983c
provides additional credibility to the research questions and
methodologies that we suggest be made a part of this study. Our
suggested approach makes a valid attempt to explain farm lending
irregularities whether they be historical and race based or neutral
loan making business decisions that have a disparate impact on minority
farm loan borrowers. Upon the general applicability of 7 U.S.C. 1983c,
we urge a methodology that informs the Secretary of Agriculture of the
benefits of frequent, effective utilization of 7 U.S.C. 1983c when
presented with a petition by a farm group showing that an area, or
group of farmers are defaulting on loans on a consistent and increasing
rate with a similar pattern or practice of lending or loan servicing.
Under 7 U.S.C. 1983c, a petition from a farm group requires the
Secretary to create a farmer Loan Pilot Project designed to prevent and
restructure loans in the area of concern. FSA direct and private
guaranteed lending in the contract poultry industry presents a good
example of consistent farm lending irregularities. For example, in the
years 2004-2007, approximately, we worked with Hmong organizations and
producers, holding focus groups and other reviews of the difficulties
faced by Hmong farmers who had relocated to northwest Arkansas near
Fayetteville, to purchase poultry operations. We reviewed practices and
called these to the attention of the Secretary of Agriculture. Many of
the families included parents who entered the US as refugees, and
children who had worked in fields such as engineering. A group
primarily from Wisconsin began to move to northwest Arkansas at the
recommendation of respected people, who had served in public positions
within USDA and elsewhere. They had some resources, and it appears the
local real estate industry worked in cooperation with the banks to
secure guaranteed loans to buy out poultry operations that were not
economically viable for their former owners. The producers showed us
that in many cases identical or nearly identical farm and home plans
were submitted to the banks for approval, and farmers were told they
could secure certain conservation benefits used by previous owners. The
prices of the farms rose as more producers moved in, and in most cases
the families were not aware of the additional costs they must incur
before the integrators would allow them to enter production. The loans
provided were proving highly risky, and many of the new producers lost
their operations. The ``solution'' recommended at the national level
after Rural Coalition and many other groups called for action, was to
pressure the Natural Resources and Conservation Service to engage
trainers from groups who worked as farm advocates to teach producers
how to better meet the requirements of the poultry integrators. The GAO
should review the loan por[t]folios in that region over the past 15
years to examine lending practices. Producers told us that the bankers,
the real estate agents, and many others benefited. The producers are
left with debts most likely still held by the Farm Service Agency.
Minority and socially disadvantaged farmers and ranchers are often
subjected to lending irregularities deemed ``non business credit risk''
loan terms and conditions. The following terms and conditions are
deemed ``non business credit risk'' terms and conditions: (i) lender
loan servicing mandate to sell borrowers existing income producing
collateral and use the sales proceeds to buy new replacement collateral
from a single tractor equipment source identified by the lender; (ii)
farmer requirement to purchase a piece of farm harvesting equipment and
immediately lease the equipment to a third party business; and (iii)
consideration of the past bad debt of a parent or other family member.
The outgrowth of these and related lending irregularities fosters
barriers to meaningful access to farm credit for minority farmers.
VI. Effective Complaints Processing and Settlement
We further note that the Farm Credit System lacks a specific system
or methodology to act on civil rights complaints consistent with ECOA
and related requirements and that one needs to be developed and
implemented in order to assure fair implementation of guaranteed
programs. We have attached correspondence that we conducted with the
Farm Credit Administration on behalf of a young African American
producer in South Carolina, and correspondence between he and FCA in
2014.
We also have correspondence and many documents on the case of a
Hmong woman who had an operation in Missouri with her husband, and how
she lost her operation after he passed away. In these cases and many
others, producers come to us at a point when it is very difficult to
save their operations. What is similar in all the cases we have
mentioned is that there is substantial confusion not only for the
guaranteed loan borrowers we have encountered, but also on the part of
advocates, on how to secure the rights provided these borrowers under
the Equal Credit Opportunity Act. The Farm Credit Administration has
not included equal credit opportunity under the protected rights it
lists on its website, and to file a discrimination complaint, producers
are told to write to the FCA Office of Congressional Relations and
Public Affairs. The questions asked and responses provided indicate
there is no formal process to investigate claims under ECOA. There do
not appear to be any statements or other information to tell farmers
how to secure their rights. We urge you to review these attachments.
The GAO study should examine what system FCA and the banks that make
guaranteed farm loans should have and how producers should be informed
of and assured their rights. Thus, producers who encounter unfair
treatment lose valuable time trying to figure out the avenues of
protection they do have. The GAO should consider what measures are
necessary to correct these deficiencies and assure guaranteed lenders
abide by ECOA in loan making and loan servicing.
The study methodology should also take a look at the specific
minority farmer lending practices within certain crops or industries
such as poultry in Arkansas, North Carolina and elsewhere, vegetable
crops in South Carolina and sugar cane crops in Louisiana. The study
will be much more valuable if it examines the lending practices in
these industries as related to African American, Hispanic, Hmong and
other Asian Pacific American, and Native Americans borrowers. A
specific portion of the inquiry should address how the details of loan
transactions may have caused or contributed to the exodus of minority
and socially disadvantaged farmers from specific farm industries in
specific areas, and who benefited and who lost in these areas.
VII. The Need for a System of Compliance Monitoring
Our Coalition has worked on the issue of compliance monitoring in
direct lending and on the issue of equitable access to all Federal
programs for farmers and ranchers for many years. In particular, we
have worked to assure the data is available to understand patterns and
barriers that interfere with the assurance of equitable access and
opportunities. Since 1987, we have worked to secure authority for the
collection and analysis of program participation data by race, gender
and ethnicity at the national, state and county levels. The Agriculture
Credit Act in 1987 required the calculation of target participation
rates for lending to the county level for direct and guaranteed loans.
Farm Service Agency and its predecessor, the Farmers Home
Administration, has done so for years. These data are available to
guaranteed lenders and the Farm Credit System. Over the years, in each
Farm Bill we have added other authorities for data and documentation.
Following the 2012 Census of Agriculture, we urged the National
Agriculture Statistics Service to provide data to the county level on
the demographics, economics and crop produced by race, gender and
ethnicity. They complied, and this data is now available at https://
www.nass.usda.gov/Publications/AgCensus/2012/Online_Resources/Race,_Eth
nicity_and_Gender_Profiles/index.php.
We have seen no evidence that the Farm Credit System and other
guaranteed lenders have any system to evaluate their lending to
minority producers as compared to other producers, or that they collect
the data they would need to proactively monitor their compliance with
ECOA.
In 2011, Farm Credit Administration released for public comment a
``Proposed Operating and Strategic Planning Rule,'' 76 Fed. Reg. 101
(May 25, 2011). Its recommendations were based on marketing practices
related to addressing ``diversity'' in the marketing practices of the
Farm Credit System Institutions, while avoiding the more central issue
of compliance with ECOA. The following is an excerpt from our comments:
``The Rural Coalition, and other undersigned partners and
allies, submitted detailed recommendations with respect to the
proposed rule, which we share with you now as they are
pertinent to the current report and merit re-examination for
the outcomes achieved following the issuance of this rule:
``The Final Rule Should Require the Federal Credit System
Institutions to Engage Historically Underserved Farmers and
Community-Based Organizations that Serve Socially Disadvantaged
and Limited Resource Farmers in the Development of Their
Marketing Plans
``According to Section 618.8440(b)(8), the marketing plans of
Farm Credit System institutions would have to include, at a
minimum, a description of the institution's chartered territory
by geographic region, types of agriculture practiced and market
segment and the strategies and the actions to ensure the
institution's products and services are equally accessible by
all farmers, with an emphasis on outreach to historically
underserved farming communities. Furthermore, the proposed rule
advises institutions to use an array of demographic
information, down to the county level, to identify the
characteristics and market segmentation of its territory (i.e.,
Websites of the Census of Agriculture, the U.S. Census Bureau,
and the United States Department of Agriculture's Economic
Research Service).
``In addition to these sources, the Farm Credit System
institutions should also engage their state National
Agricultural Statistics Service (NASS) Directors to generate
data specific queries in order to obtain a deeper understanding
of the farmers that the institutions are mandated to serve.
``Additionally, institutions should also specifically work
with the USDA to obtain the annual application and
participation rate data mandated in Section 14006 of the 2008
Farm Bill, including numbers and percentages, for each county
or parish and state in the United States, organized by race,
gender and ethnicity, from USDA's Farm Service Agency and Rural
Development programs. The Farm Credit should also look at this
authority and other more recent authorities to generate their
own data on participation in their programs.
``Section 618.8440(b)(8), also advises that the `marketing
plans of institutions include grassroots outreach activities
and education efforts that market to underserved populations
regarding business and financial planning and leadership and
loan programs for persons who are creditworthy and eligible to
borrow.'
``Although outreach to underserved farming communities is an
essential component of an institution's marketing plan, the
unique perspective and reality of the underserved farmer should
be incorporated in the developmental process of the
institution's marketing plan. Accordingly, the final rule
should require institutions to include historically underserved
farmers and community-based farming organizations that serve
socially disadvantaged and limited resource farmers in the
developmental process of the institutions' marketing plans.
``In preparing our Coalition's comments to this proposed
rule, we spoke to several members about the Farm Credit System
and there exists a universal perception that the Farm Credit
System institutions are not accessible to the underserved
farmer and have failed to conduct outreach to these communities
to educate them regarding the institutions' programs and
services. In the words of a long-time Latino farmer and
advocate, `the Federal Credit System is further beyond the
reach of the farmer than a commercial bank, we never felt this
was a source of assistance.'
``Moreover, institutions should work to develop meaningful
relationships with the USDA Minority Farms Advisory Committee
authorized in the 2008 Farm Bill and now established,
community-based organizations that serve socially disadvantaged
and limited resource farmers, 1890 and 1994 Land-Grant Colleges
and Universities, and grantees under the 2501 Outreach and
Technical Assistance Program, as well as identify persons from
these committees, institutions and organizations to assist in
the development of marketing plans. Furthermore, the Farm
Credit System Diversity Workgroup should also identify members
from the aforementioned committees, institutions and
organizations to assist in the development of its programmatic
efforts to reach historically underserved farming communities.
The development of such relationships is essential if progress
is to be made in expanding credit to this growing market.
``As required by Section 4.19 of the Farm Credit Act, Farm
Credit System associations and institutions should continue to
tailor credit programs and services to address the needs of
Young, Beginning, and Small farmers and ranchers. Although
these programs do not have the explicit objective of advancing
customer diversity and inclusion, these programs should be used
as essential outreach portals to socially disadvantaged farmers
and ranchers. As mentioned in a previous section of these
comments, the current participation rate data of the USDA
Beginning Farmers and Ranchers Program serves as a cautionary
illustration of how well-intentioned programs can neglect the
needs of historically underserved farming communities,
especially if these communities are not included throughout the
program development process.
``Moreover, the final rule should emphasize the importance of
allowing institutions to use discretion in determining whether
farmers are creditworthy and eligible to borrow. If the Farm
Credit System institutions want to make significant strides in
serving historically underserved farming communities, these
institutions must recognize that their credit requirements
should not be rigidly enforced and should allow for case-by-
case exceptions (i.e., waiver or lowering of collateral
requirements). The language `creditworthy and eligible to
borrow' should not be interpreted or implemented in such a
manner to undermine the spirit of the proposed rule, which is
to make the institutions more responsive to the needs to
historically underserved farming communities.
``The Final Rule Should Include Revisions to the Proposed Rule's
Working Definition of Diversity
``Throughout the proposed rule, diversity is purported to be
achieved through the inclusion of all individuals of varying
race, ethnicity, sexual orientation, age, disability, social
class, religious and ideological beliefs and not through a list
of demographic criteria.
``This working definition of diversity is problematic and
provides a loophole for institutions to avoid implementing a
marketing plan that actually promotes diversity and
inclusiveness within the institutions' borrower base.
Demographic criteria should be given equal weight in
determining whether institutions are in fact providing equal
access to credit to all farmers.
``Consequently, an institution's commitment to diversity and
inclusion cannot be ascertained by an institution's lofty
mission statement (as suggested by the Farm Credit
Administration's Request for Comments) rather by the
institution's actions and achievement of assessment benchmarks.
The final rule should include a revised definition of diversity
to address these concerns and should also assure that the
diversity includes actual borrowers or potential borrowers from
the socially disadvantaged community who actually understand
the issues, the history and the complexity of small rural
communities and their racial, ethnic and gender dynamics and
history.
``The Final Rule Should Require the Farm Credit System Institutions
and Diversity Workgroup to Make Their Final Marketing Plans and
Participation Rate Data Public
``The Farm Credit System Diversity Workgroup was established
in 2006 to increase diversity awareness, promote understanding
of inclusiveness, and serve as a diversity resource within the
Farm Credit System. Since its inception, the Diversity
Workgroup is purported to have sponsored a diversity
conference, several trainings workshops, speakers, outreach and
communications. Despite the laudable efforts of the Diversity
Workgroup, the effectiveness of the Workgroup's efforts to
achieve a more inclusive workforce and borrower base must be
evaluated through various assessment and accountability
benchmarks. For example, some pertinent questions that must be
addressed by the Diversity Workgroup [and at the current time
by the Farm Credit System and lenders in General]:
``(1) How many farmers from historically underserved farming
communities
have applied for and received loans from Farm Credit
System institutions;
``(2) Are the institutions' borrower base reflective of the
market segmentation
of their chartered territories? If not, what specific
steps has the Workgroup
recommended to the institutions to ensure they adhere
to their mandate
of providing equal access to credit to all farmers.
``The final rule should require the Farm Credit System
institutions and Diversity Workgroup to make their marketing
plans as well as their assessment and accountability findings
public. Moreover, if there are egregious shortcomings in the
marketing plans efforts to respond effectively to the needs of
historically underserved farming communities, these plans must
be revised to address these gaps in services. In essence, the
institutions should view their marketing plans as fluid plans
that can be amended as necessary to be more responsive to the
institutions' diverse borrower base.
``. . . Farm Credit System institutions should take
affirmative steps to ensure that data systems are in place to
record the important demographic and participation rate data of
all borrowers to allow comparisons and track progress.
``The Final Rule Should Require Farm Credit System Banks and
Associations Board of Directors to Appoint Directors From
Historically Underserved Farming Communities or Community Based
Organizations that Serve Socially Disadvantaged and Limited
Resource Farmers
``Reiterating Farm Credit Administration Bookletter BL-009,
the proposed rule encourages all Farm Credit System
Institutions' Board of Directors to appoint directors to serve
on the Board that would further the aim of facilitating
diversity, when feasible. Again, the discretionary language of
the proposed rule (i.e., `encourages') will not bring about
transformative change in the corporate culture of the Farm
Credit System institutions. In order to bring about substantive
change in the corporate culture of these institutions, the
final rule should mandate that at least one appointment to the
institution's Board of Directors be a member from a
historically underserved farming community or a community-based
organization that serves socially disadvantaged or limited
resource farmers.''
Now in 2019, we further recommend a review of racial, ethnic and
gender diversity among the directors and staff of the lending
institutions of the Farm Credit System.
While some statutes have been updated since our recommendations in
2011, we see no evidence FCA has changed their systems to comply with
ECOA and to assure fair service to all borrowers and potential
borrowers. The GAO report should address these fundamental issues of
the ability of the Farm Credit System and guaranteed lenders to assure
fair service to all producers, as ECOA requires them to do.
VIII. Conclusion
The results and findings of a comprehensive study could assist
lender and government agencies with the legal mandate to offer the same
loan products and loan servicing options offered to each and every
farmer regardless of social status. The success of highlighting
irregular farm lending patterns, and lack of systems to address these
patterns, will be instructive to all farmers, lenders and reduce the
overall costs of farm lending transactions while preventing
questionable or unlawful family farm foreclosures.
[Attachments]
[Letter 1]
December 18, 2014
[Redacted]
Email address: [Redacted]
Re: Document No. [Redacted]
Dear [Redacted],
We are writing to acknowledge your November 21, 2014, email sent to
[email protected] and your November 25, 2014, conference call with
members of the Farm Credit Administration (FCA) staff advising us of
your concerns with the operations of AgSouth Farm Credit, ACA (AgSouth
or Association). In your email, you inquired about filing a
discrimination complaint against AgSouth. In your conference call with
FCA staff also explained that you were facing foreclosure. We have
initiated a review of the servicing of your loan and will respond to
you as soon as our review is completed.
This process generally requires several weeks to complete. If we
have not completed our review within 30 days of the date of this
letter, we will notify you by email of the status of our review. Please
understand that in the process of conducting our review, we may contact
AgSouth to obtain information regarding the issues you raised. While we
do not share with the Association details of our telephone conversation
with you, we may need to reveal your name and certain details to
resolve your complaint.
Before concluding, I would like to briefly explain who we are and
the authorities that we have. The FCA is an independent Federal agency
that regulates and examines Farm Credit System (System) institutions.
We also ensure that System institutions operate in a safe and sound
manner and in compliance with applicable laws and regulations. Although
part of our mission is to evaluate borrowers' concerns of wrongdoing by
institutions like AgSouth, we can intervene in those institutions'
business decisions only if their decisions violate applicable laws or
regulations. We also cannot mediate disputes between those institutions
and their borrowers. Please note that there are limitations on what we
can do:
We cannot act as a court of law.
We cannot give you legal advice.
We cannot become involved in complaints that are in
litigation or have been litigated.
We cannot intervene in business decisions of a Farm Credit
System institution that do not violate laws or regulations, nor
can we intervene in any way that would adversely affect the
safety and soundness of the institution.
We cannot mediate or adjudicate disputes between Farm Credit
System institutions and borrowers.
Please include your document number (provided above) on any future
correspondence you send us. If you have questions, please call us at
[Redacted].
Sincerely,
Michael A. Stokke, Director,
Office of Congressional and Public Affairs.
[Letter 2]
December 19, 2014
Hon. Jill Long-Thompson,
Farm Credit Administration,
McLean, VA
RE: Document No. 13184
Dear Ms. Long-Thompson:
We write to you on behalf of Mr. [Redacted] a [Redacted] year old
African-America farmer in South Carolina who without immediate action
faces the loss of his redemption rights to redeem the farm his
grandparents owned and operated as a cattle operation in [Redacted],
South Carolina for over 65 years, and [Redacted] acres of which they
deeded to Mr. [Redacted] in 2006.
In 2008, Mr. [Redacted] began a long, tedious process to seek
financing through AgSouth Farm Credit to purchase additional farm
equipment, obtain a line of credit, and obtain financing to apply as a
down payment on a [Redacted] acre operating farm he purchased in
[Redacted], South Carolina.
He has since struggled to secure access to credit and NAP to
operate both farms, and on December 1 of this year, his farms were
foreclosed on. It is our understanding that he has until December 31,
2014 to exercise his right of redemption on the [Redacted] farm his
grandparents owned, a farm that is now in the possession of AgSouth
Farm Credit.
Mr. [Redacted] has communicated the details of his situation to the
Rural Coalition, and has also filed a discrimination complaint with
Farm Credit Administration. Your Office of Congressional and Public
Relations has responded with a letter of December 18 that you are
reviewing his complaint, referred to in Document No. 13184, noting that
it may take up to 30 days to review his complaint and you will let him
know if more time is needed.
We therefore urge Farm Credit Administration to advise AgSouth Farm
Credit to postpone the scheduled sale of this land on December 31, 2014
until a full review is completed of all matters related to the
servicing of this loan under the terms of the Equal Credit Opportunity
Act and all other applicable statutes. We further urge FCA and AgSouth
Farm Credit to advise Mr. [Redacted] in detail exactly what redemption
rights he has to reclaim this property before, during and/or after a
final sale.
Mr. [Redacted] has shared the details of his situation with the
Rural Coalition and requested our assistance, which as of December 5,
2014 we have formally agreed to provide on his behalf. We have acted in
support of and on behalf of Mr. [Redacted] because we strongly believe
that it is young producers such as himself that are critical to the
future of all farmers and ranchers, and particularly African American
farmers, in U.S. agriculture. As such, Mr. [Redacted]'s case is of
utmost importance to our Coalition, its members and farmers. The elder
farmers of the Rural Coalition, including the leaders of our Farm and
Ranch Team, have made the commitment to mentor and work with Mr.
[Redacted] to assure his future viability. If Mr. [Redacted] fails in
his desire to maintain land that has been in his family for generations
and to secure a future in farming, then all of us have failed. Moving
forward, we believe it would be most beneficial to all of us to figure
out ways to work together to assure this future.
We are also writing to seek the assurance that Farm Credit
Institutions such as AgSouth Farm Credit, that are accorded Preferred
Lender Status and the guarantee of loans on the faith and credit of the
United States through the USDA Farm Service Agency, value young
farmers, and especially African American and other diverse farmers and
ranchers, as important an asset as the value of their land. We
understand there are fiduciary duties, and emphasize that one of them
is to assure the terms of the Equal Credit Opportunity Act are met in
letter and spirit in your lending policies, procedures and practices.
We believe that providing equal credit opportunity should also be
viewed as an investment and market issue for FCA and Farm Credit System
lenders. In the attachment to this letter, we have included our recent
brief on how the sector of diverse producers that we serve is
expanding. We believe that as our Coalition and others keep working for
the transformation of systems and relationships, the sector has the
potential to grow further, and each diverse producer that has a
successful relationship with a Farm Credit System institution is a
critical link to Farm Credit System's potential future market within
this sector.
That being said, we turn to the question of the standard of service
provided to Mr. [Redacted] and the processes and procedures by which
FCA and its members have observed this standard. We strongly feel the
details of his case merit an immediate and complete onsite review that
also affords Mr. [Redacted] the ability to more fully present his view
of the matter.
We have observed that the processes by which the rights of
producers are assured by both Farm Credit System lenders and the
multiple agencies of the U.S. Department of Agriculture, while
intricately linked, remain confusing and profoundly unclear, and not
only to those of us who have worked as advocates for many years. Mr.
[Redacted] has been left on his own to navigate a series of conflicting
messages and unclear assurances of his rights and how they intersect
between the many institutions, agencies and processes. Some of the
advice he has received is not correct.
We believe that a review of Mr. [Redacted]'s history with the
AgSouth Farm Credit should begin with the question of whether he
received the same service and standard of service as other producers at
every step of the way from the time he first sought a loan. Mr.
[Redacted] has come to believe that on the basis of his race, he did
not receive the same standard of service and assistance, and that is
the basis of his complaint, which we support.
Mr. [Redacted] has also told us that as he sought to bring a buyer
before his land was foreclosed on December 1 of this year, he was told
that AgSouth Farm Credit would not release the lien. Mr. [Redacted]
says that one reason communicated to him through his attorney was the
fact that as guarantor, that USDA Farm Service would need to sign off
and was likely not to wish to do so. Mr. Pressley was told at the same
time that USDA did not have the authority to impose a moratorium on
accelerated action on a guaranteed loan as it can when a civil rights
claim is active on a direct loan. We seek clarification on how the
rights of a farmer are protected and exercised in cases where both FSA
and Farm Credit lenders have an interest. Thus, in Mr. [Redacted]'s
case, in what way was Farm Service Agency consulted, and did FSA in
this or any other case have or exercise the authority or interest in
rejecting this release of the lien?
As FCA moves forward with its review of this matter, we seek
additional information on what process will be used to conduct this
review, and under which statutes. We have observed that FCA has a
comprehensive nondiscrimination policy on Equal Employment Opportunity,
and a person responsible to implement this policy. Similarly, there is
a policy and structure related to ethics. With respect to Equal Credit
Opportunity, borrowers are referred to the Office of Congressional and
Public Relations. Similarly, those with complaints related to their
borrowers rights are directed to the same office. However, among
borrowers rights detailed on the website, nondiscrimination is not
listed. In a cursory review we were also not able to find an
affirmative non-discrimination statement on Equal Credit Opportunity
similar to the policies on Equal Employment Opportunity.
We request information on what process and capacity reside in the
Office of Congressional and Public Relations to conduct either a
borrowers rights or equal credit opportunity review, why this office is
assigned the responsibility for this review, and whether this review
will include all relevant statutes including those related to equal
credit opportunity. What ability does Mr. [Redacted] or any borrower
have to provide information to this process? On the website and in your
communication to Mr. [Redacted] there are numerous disclaimers about
the authority of Farm Credit Administration to enforce these rights or
to intervene if equal credit opportunity is not duly observed.
The information on the website seems to suggest that the borrower
will have to resolve these issues directly with the lender. But on the
AgSouth website, borrowers are told that if they have a concern related
to Equal Credit Opportunity they should take those concerns to Farm
Credit Administration. What authority and process does Farm Credit
Administration or AgSouth Farm Credit have to resolve Equal Credit
Opportunity Claims, and can it do so in a manner that is designed to
protect the rights of the borrowers as well as those of the
institution? Where and how can such claims be reviewed and with what
protections to the borrower? If the above is not a resolution process,
what process is open to Mr. [Redacted] and other borrowers and by what
method can their rights be secured?
We ask the above questions with reference to what has already
happened. In Mr. [Redacted] first contact to your office, the Assistant
Director of the Office of Congressional and Public Relations and Mr.
Eric Ovsiew, whom we understand is an attorney, were the first to whom
Mr. [Redacted] was directed, and following their conversation, rather
than providing some neutral format or procedure to file a complaint,
they wrote back on November 26, 2014 with very specific questions that
we would wish to assure would be in a borrower's interest to answer.
How will such information be used, and how would it contribute to the
ability of FCA to assure that Equal Credit Opportunity is afforded to
Mr. [Redacted] and any other borrower by AgSouth Farm Credit or any
other Farm Credit System lender?
We believe protections are especially important because in our
experience working with thousands of diverse producers, we have found
disparities in treatment at many levels, but especially in the use of
appraisals to value land. We are especially concerned that the
appraised value of the property in question has sharply declined, and
Mr. [Redacted] stands to be held liable for many thousands of dollars
of repayments of the guaranteed farm loan loss claims while others
might obtain his land at a fraction of the assessed value for which he
was first provided financing, while any risk to the lender is absorbed
by the government and the borrower through the guaranteed process.
We have already raised with USDA the need to assure that much
clearer information is provided to Mr. [Redacted] and all other
producers of their borrowers rights and their right to equal credit
opportunity under both direct and guaranteed loans both separately and
as they intersect. We have urged USDA, and raise also to you the need,
to clarify the process to secure these protections and to secure them
in the timely manner necessary to avoid the foreclosure and losses that
Mr. [Redacted] and others have incurred.
We cannot afford to lose another generation of African American
producers to the same systemic inequities we have worked so hard to
root out and eradicate. The leadership of Farm Credit Administration
has stated its commitment to diversity and inclusion. We seek to
understand how this commitment operates in practice. Immediate action
is essential to assure Mr. Pressley's future in agriculture, and his
future and that of his generation of farmers and ranchers matters to
all of us.
We urge you to see the sale on December 31 is halted until such
time as a fair review is completed and Mr. [Redacted]'s equal
opportunity, borrower and redemption rights are assured. We may be
reached at the address above, or by contacting Lorette Picciano by
email at [Redacted]. An alternate phone number when our office is
closed is [Redacted].
Sincerely,
John Zippert, Georgia Good,
Chair Person, Vice Chairperson;
Lorette Picciano, Willard Tillman,
Executive Director, Board Member.
The Rural Coalition, born of the civil rights, indigenous
rights, and anti-poverty rural movements, has worked since 1978
to assure that diverse organizations from all regions, ethnic
and racial groups, women and men, and youth and elders, have
the opportunity to work together on the issues that affect them
all. The foundation of this work is strong local, regional and
national organizations that work to assure the representation
and involvement of every sector of this diverse fabric of rural
peoples.
CC:
[Redacted], Farmer;
Kenneth A. Spearman, Board Member, Farm Credit Administration;
Leland A. Strom, Board Member, Farm Credit Administration;
Charles R. Rawls, General Counsel, Farm Credit Administration;
Michael A. Stok[k]e, Director, Office of Congressional and Public
Affairs, Farm Credit Administration;
Charles C. Rucks, Chairman, AgSouth Farm Credit, ACA;
William T. Robinson, Vice Chairman, AgSouth Farm Credit, ACA;
Walter W. Douglas, Outside Director and Member, Governance and
Ethics Committee, AgSouth Farm Credit, ACA;
Ken Auer, President and CEO, Farm Credit Council;
Tom Vilsack, Secretary, United States Department of Agriculture
(USDA);
Val Dolcini, Administrator, USDA Farm Service Agency;
Chris Beyerhelm, Deputy Administrator for Farm Loan Programs, USDA
Farm Service Agency;
Joe Leonard, Ph.D., Assistant Secretary for Civil Rights;
Benny Bunting, Advocate;
Savonala Horne, Esq., North Carolina Association of Black Lawyers
Land Loss Prevention Project;
Alfonzo Abeyta, Farmer and Co-Chair, Rural Coalition Farm and Ranch
Team;
Ben Burkett, Farmer and Co-Chair, Rural Coalition Farm and Ranch
Team.
Attachment
``The Census of Agriculture Shows Progress in Maintaining Diverse
Producers in Agriculture,'' prepared by Rural Coalition, October 2014.*
---------------------------------------------------------------------------
* Editor's note: The document entitled, The Census of Agriculture
Shows Progress in Maintaining Diverse Producers in Agriculture listed
as an attachment was not included in the submission by the Rural
Coalition/Coalicion Rural for the March 25, 2021. A news release of the
same title exists on the Rural Coalition/Coalicion Rural website;
however, it is dated May 2015, and appears to have been updated July
24, 2018 (https://www.ruralco.org/press-releases/2018/8/31/the-census-
of-agriculture-shows-progress-in-maintaining-diverse-producers-in-
agriculture-june-7-2018). Due to the conflicting date information it
has not been included in this publication, nor has it been retained in
Committee file.
---------------------------------------------------------------------------
______
Submitted Article by Hon. Jim Costa, a Representative in Congress from
California
[https://www.chicagotribune.com/news/ct-xpm-2006-05-15-0605150155-
story.html]
Chicago Tribune
Hmong poultry farmers cry foul, sue
Howard Witt, Tribune Senior Correspondent
May 15, 2006, Ozark, Ark.
When Eric Xiong quit his factory job and bought a modest turkey
farm nestled here in the Ozark Mountains three years ago, the 32 year
old Hmong immigrant from Laos thought he had finally snagged his piece
of the American dream. At last he could leave behind a string of dreary
manufacturing jobs, be his own boss and provide for his wife and two
young children.
But the harder Xiong worked, it seemed, the more money he lost. The
first year he fell $20,000 short of what he needed to pay his bills.
The next year he lost $50,000 more. By the end of last year, he had
depleted his savings, stopped paying the mortgage on his farm and
started borrowing from relatives to put food on the table. He declared
bankruptcy a few months ago.
``When we bought this farm, the bank promised us it would provide
us a decent living,'' he said. ``But we've been losing money from the
very first day.''
If Xiong's story were isolated, it might be written off as another
sadly familiar tale of an inexperienced small farmer gone bust in the
notoriously difficult poultry business. Except that Xiong is far from
alone.
Across Arkansas, Oklahoma and southern Missouri, more than a dozen
Hmong poultry farmers--most of them uneducated Vietnam-era refugees
with little command of English--have filed for bankruptcy protection
this year. Hmong community leaders and advocacy groups estimate that
scores of others are in financial trouble.
All of the farmers in bankruptcy appear to have paid far more for
their farms than they were worth and are saddled with large mortgages
they cannot repay. Most say they were told to sign loan documents they
didn't understand that seemed to greatly overstate the income potential
of their farms and understate their expenses.
Now small-farmer support groups, attorneys and Agriculture
Department officials are asking whether some of the Hmong, who began
moving here five years ago from Minnesota, Wisconsin and California,
were defrauded.
All the loans have one feature in common: They are guaranteed by
the U.S. Department of Agriculture's \1\ Farm Service Agency program to
assist minority farmers, which pays off up to 95 percent of each loan
if the farmer defaults, thus relieving the banks of nearly all risk.
---------------------------------------------------------------------------
\1\ https://www.chicagotribune.com/topic/politics-government/
government/u.s.-department-of-agriculture-ORGOV0000241-topic.html.
---------------------------------------------------------------------------
Advocates for the Hmong wonder whether an informal ``good old boy''
business network spread the word that the Asian immigrants, who
typically had cash for down payments, were easy marks--and a chance to
unload troubled farms.
``The banks don't give these loans much scrutiny because they know
the Federal Government will repay them if the farmer defaults,'' said
Sean Brister, an attorney in Fayetteville, Ark., whose firm has filed
six lawsuits in recent weeks on behalf of Hmong farmers.
Moving Into Region
Others perceive racial motives in a place where Asians and other
minorities are not frequently encountered. The Hmong stand out because
few have learned English or assimilated decades after they began
arriving in the U.S. from refugee camps in Thailand, where they were
driven in 1974 after backing U.S. troops battling Laotian communists.
The first few Hmong farmers arrived here in 2001 to buy poultry
farms. Now Hmong community leaders estimate that 500 Hmong families
operate poultry farms in the three-state region.
``I'm finding ethnic prejudice in all of this,'' said Jim Pate, an
attorney in Russellville, Ark., and Vietnam veteran representing
several Hmong farmers in bankruptcy court. ``In almost every case, when
the banks set them up with these loans, they were preparing them to
fail.''
The attorneys and advocates involved stop short of alleging any
conspiracy to defraud the Hmong farmers, or even direct collusion
between the various banks and appraisers involved in all of the cases.
And they acknowledge that some of the bankruptcies might be the result
of market forces: The rush of Hmong to the region seeking to buy
poultry farms bid up prices beyond what the inexperienced farmers could
sustain.
Yet there are hard-to-explain similarities in the paperwork for a
number of the loans.
In some cases, bank loan officers added 30 percent or more to the
income estimates provided by the poultry companies that issued the
production contracts to the farms. In others, the banks added projected
income from the sale of poultry litter--a waste product farmers
typically must pay haulers to remove.
``I don't have a good answer to the question of whether this is all
organized in some way,'' said Scott Marlow, director of farm
preservation for the Rural Advancement Foundation International in
Pittsboro, N.C., who has reviewed the Hmong situation. ``What I can say
is that across a series of applications that we read, chunks of the
applications would be identical or very similar.''
In four cases Brister is pursing, loan officers from different
banks filled in similar estimates of $18,000 to $20,000 for the Hmong
family's living expenses--regardless of family size.
In Xiong's case, that expense estimate allowed for just $9 per day
to feed his family of four.
Unlike many of the Hmong families in the region, Xiong speaks
English well and holds an advanced university degree. But he says his
education did not help him understand the financial paperwork
associated with the purchase of his 143 acre turkey farm in early 2003.
Among those papers is a letter from Cargill Turkey Products, which
issued the production contract to the farm Xiong bought. In the letter,
addressed to a loan officer at Regions Bank in Ft. Smith, Ark., Cargill
predicted Xiong could earn $107,000 to $156,000 by raising turkeys and
selling them to Cargill.
But when the loan officer filled out a Federal loan guarantee form
forecasting Xiong's income, he wrote down $186,320, plus $4,670 for the
sale of litter waste--nearly $35,000 more than the highest estimate
provided by Cargill.
Other documents included in Xiong's lawsuit allege that the real
estate appraiser inflated the number of turkeys the farm could sustain
and misrepresented the age of the buildings on the property, both of
which helped to justify the $865,000 that Xiong paid for the farm.
Denying Misrepresentations
The real estate appraiser named in the lawsuit did not return calls
seeking comment. But for their part, Regions Bank officials strongly
deny that they misled Xiong or any other Hmong farmers or purposefully
wrote unsustainable loans.
``We don't make loans that we think people are not going to be able
to repay,'' said Mike Cialone, president of the Regions Bank branch
that issued Xiong's mortgage.
But advocates for the Hmong contend that the banks stood to benefit
in several ways. Many of the sales involved farms that already were
troubled and in danger of default, so selling to the Hmong meant
converting shaky mortgages into mortgages with government guarantees.
And the higher sale prices paid by the Hmong meant bigger loans and
more interest revenue.
Federal agriculture officials overseeing the guaranteed loan
program say they have heard anecdotal evidence of a handful of Hmong
bankruptcies but have yet to find clear trends that might point to
malfeasance.
But they acknowledge that they do not normally scrutinize loan
guarantee applications received from ``preferred'' bank lenders in the
Farm Service Agency program, such as Regions Bank, according Bob
Bonnett, chief of the guaranteed loan division. The officials say they
are reviewing the lawsuits and bankruptcy petitions.
``It is a crime if people are being taken advantage of down
there,'' Bonnett said. ``If we find out that has been happening, we
will take action.''
Any such enforcement action will come too late to help Xiong,
however, who expects he will lose his farm when the bankruptcy
proceeding is complete.
``After the first year, when it was clear that I could not support
this farm, I called the real estate agent and told her I wanted to
sell,'' Xiong said. ``She said it was worth $200,000 less than what I
paid for it--what she let me pay for it. I put my trust into other
people and they took advantage of me.''
______
Submitted Hearing by Hon. Jim Costa, a Representative in Congress from
California *
---------------------------------------------------------------------------
* Editor's note: The current extant link for an electronic copy is
a Digitized by Google pdf: https://books.google.com/
books?id=hN8iL0W1XbAC.
* * * * *
STATEMENT OF PHENG VUE, PRESIDENT, CALIFORNIA HIGHLANDER
COOPERATIVE, INC.
Mr. Vue. Thank you, Mr. Chairman, and members of the
subcommittee for giving me this opportunity to testify on the
treatment of minority and limited resource producers by the
U.S. Department of Agriculture.
My name is Pheng Vue. I'm a farmer. Before I became a
farmer, I was working for Hmong Organization. We receive
funding from the Federal Government, local government to
provide education, social adjustment, job development to our
people. Nowhere do programs protect the Southeast Asian
farmers.
Day to day, year by year many farmers are approaching me
asking for assistance. I made a decision that I should quit my
job and join them as a farmer, see what kinds of problems they
have. So I become a farmer.
I have been a farmer almost 6 years. Mr. Chairman, about 15
years ago, I mean, back in 1980, there were less than 30
Southeast Asian farmers in the San Joaquin Valley of
California. In 1988, the number increased to about 800 farmers,
today more than 1,000 Southeast Asian farmers in the San
Joaquin Valley of California.
We produce strawberries, cherry tomatoes, greenbeans,
sugarpeas, squash, and many other Oriental vegetables. The
total production values are over $30 million each year. The
annual contribution to the agribusiness in the San Joaquin
Valley are over $10 million from purchasing farm supplies,
fertilizers, equipment, seeds, plants, and give the employment
opportunity to the community.
Along with what I stated, Southeast Asian farmers face a
major disadvantage from not able to share the same profits as
other groups. Each year Southeast Asians were able to produce
lots of products. However, we could not find enough brokers to
purchase our produce. More and more brokers say that American
markets are too expensive. They prefer to import from other
countries.
This resulted in losing tons and tons of our crops each
year. In addition, many times we were forced to sell our
produce in a lower price, which could not even cover our labor
costs. For this reason, how can we survive as we continue to
produce our products to support our families?
Today there are only two companies in the local area which
is willing to buy our strawberries from the Southeast Asian
farmer. However, both of these companies did not want to
purchase the large volume of strawberries. Therefore, at this
present time, any farmer who wishes to grow different kinds of
strawberries worries that the market may not be suitable for
them to grow at the meantime.
We are also facing other major problems. There is no local
lender willing to loan money to our people. Even though several
of us have been banking at the same bank over 10 years, when we
applied for a line of credit, we were denied. These practices
did not and have not been very helpful to our community as we
share the burden of paying income taxes to support this great
country, just like any other American people.
For all the years of farming that I recall since I joined
them as farmer, we have never received any source of support
from neither the local, State, or Federal Government such as
farm loan, loan guarantee, or Farm Disaster Program.
For example, in 1994, we have 16 Southeast Asian strawberry
farmers suffer damage from the storm that destroyed their
strawberry fields, about 90 percent of their crop. Our farmers
contacted a Government agency in the area, but none of them
would respond.
The farmers also contacted the Farmers Home Administration
in Fresno County for assistance, hopefully to qualify for
receiving the Farm Disaster Program and the Loan Guarantee
Program, but at the end, the answer was no. The USDA people
said that they have never heard of any Southeast Asian farmers
in the Central Valley of California and they don't have staff
available to help. The same problems continue until today.
Well, Mr. Chairman, since I have to share time with Dr.
Chang, in my conclusion here, I would like to request you to
look at my testimony. And I would like to request you to
support us because we are Southeast Asians coming to this
country without preparing. When we come here, we have only one
skill: go back to farming. So please read my testimony and give
us help.
Thank you.
[The prepared statement of Mr. Vue appears at the
conclusion of the hearing.]
Mr. Goodlatte. Thank you, Mr. Vue. We appreciate your
testimony, as we do all of the witnesses.
Mr. Powell, what steps were taken by the Department with
regard to the particular instance of discrimination that you
experienced and you recounted in your testimony? Has the
Department looked into that matter? And have they conducted any
kind of investigation or taken any action as a result?
Mr. Powell. Yes. They conducted an investigation and found
affirmative findings that was discriminated again, but that is
as far as it has gone. Nobody has done anything to try and
compensate myself nor several other farmers with the same
affirmative findings.
Mr. Goodlatte. How long ago was that finding made?
Mr. Powell. I think it was in 1992 or 1993.
Mr. Goodlatte. And have they left this record open? Did
they say they would be back in touch regarding some action to
be taken on it or----
Mr. Powell. Well, we have been trying to work with them.
And nobody has done anything to compensate me or no one else on
these issues. All they would do is they would talk about it.
Mr. Goodlatte. Is the file still open?
Mr. Powell. Yes, sir, the file is still open.
Mr. Goodlatte. When is the last time you had any
communication with them about that?
Mr. Powell. My attorney has been keeping the communication
with them. I think he talked with Mr. Reeves sometime this
week. But we have been getting talk all the time. These
sessions like today and other days, they are very good. We
appreciate them.
This is time when all farmers need to be preparing their
land, getting it ready to make a crop for the 1997 crop year.
And if they're having trouble getting the loan, then it's going
to be a lot of farmers that will not be able to plant a crop
this year. This is March. Corn should be planted this month to
be profitable.
Mr. Goodlatte. But we will hear the Department's comments
on that and other matters when we take that up with them
hopefully within the next month or so. We are expecting the
opportunity either at the subcommittee or the full committee
level to hold some further hearings, hear the Department's
report and their recommendations.
Mr. Boyd, you had indicated in your testimony that there
were 1,500 complaints pending at the Department of Agriculture,
but only 271 of them have been acknowledged. Is that your
position?
Mr. Boyd. That's correct.
Mr. Goodlatte. What do you base the 1,500 figure on?
Mr. Boyd. Based on complaints that I have seen come through
my organization. There are 168 active complaints in Virginia.
They've got on that list that I gave you somewhere in the
neighborhood of 15.
I mean, why? I don't understand what's going on. Why have
this Office of Civil Rights if nothing is going to be
implemented there? This is the whole problem at the Department
of Agriculture. There is no implementation at the Department.
There is no accountability at the Department. And the
Department of Agriculture needs major overhauling.
Mr. Goodlatte. Ms. Felzien, what rules prevent officers of
your organization from running for FSA County Committee
positions?
Ms. Felzien. It's section 401(b) of the ASCS handbook, 22-
PM.
Mr. Goodlatte. And what do you think is the rationale
behind that on the part of the Department?
Ms. Felzien. I really do not know.
Mr. Goodlatte. If these prohibitions were removed, what do
you think is the best process to select the most qualified
women to serve on county committees?
Ms. Felzien. Going through the county committee. If we're
addressing our county committees, you have to be a landowner.
You fill in the application and have the ballot throughout the
county. But she should at least be allowed to have the ability
to run or he.
Mr. Goodlatte. Have you personally experienced difficulties
obtaining a loan or other services through the FSA?
Ms. Felzien. No because I am just married to a farmer. I
can only have the power of attorney. I am not considered a
person that's able to do that.
Mr. Goodlatte. Mr. Windy Boy, does the Bureau of Indian
Affairs have any kind of outreach or educational programs to
help Native American producers?
Mr. Windy Boy. In the light of the way the Bureau of Indian
Affairs is downsizing and reducing their funding through both
Congress and the Senate, nothing that would really address
agriculture per se.
Mr. Goodlatte. And, Mr. Vue, have you gone to a county FSA
office to apply for a loan? And if so, what kind of experience
did you have?
Mr. Vue. When we go to apply for this kind of loan, the
first question they're going to ask, they ask ``What kind of
crop do you plant and how many acres you have?'' That's what
the question they would ask.
Mr. Goodlatte. All right. Thank you. Those are all the
questions that I have.
The Chair recognizes the gentlewoman from North Carolina.
Mrs. Clayton. Thank you, Mr. Chairman.
I want to just observe that, as I might have observed when
I thought the GAO was limited in scope, certainly the total
effect of all of your testimony shows how pervasive and how
widespread the discrimination is and how it's not any one group
or one gender. It's there, and it comes in subtle ways. And it
affects real people and timing.
Sometimes the rules are not only things that cause persons
to be denied of their resources, but it's attitudes. It's
processing. A violation of the rules obviously is something you
can get at, but you cannot get at how people respond to other
human beings or you can't get at how slowly or how swiftly
people process or what assistance is given and what indeed
information is withheld and not told.
Mr. Harris, you have been doing this for a long time. And I
gather sometimes we can get cynical, not because you're a
lawyer. Lawyers are cynics anyhow. But sometimes you can get
cynical.
You've gone through some of these. Do you perceive any
change in attitude that gives you any sense of hope that maybe
we won't just go through this again, that you're not all over
again, deja vu all over again, that we really are serious there
is a sense of hope for you in this process?
Mr. Harris. There is a sense of hope. I have a sense of
hope with respect to the members of the Agriculture Committees
for both the House and Senate. Over the past 4 to 6 years,
there have been new faces, who are very much concerned about
these issues and have come from districts where their
constituents are directly impacted.
The fact that we have been able to discuss these issues
with the current and the past Secretary of Agriculture;
whereas, before we couldn't even meet with the person, is
encouraging. The fact that we are having these types of
meetings and hearings is encouraging.
The caution that I do have is in the reality that,
regardless of what happens in Congress and at the top levels of
USDA, you still have the second or third largest bureaucracy in
this country, which is entrenched.
Mrs. Clayton. The second.
Mr. Boyd. The second? Thank you.
And it has a very institutional plantation mentality. And
if we're not careful, all of our work will be for naught.
Mrs. Clayton. There are also recommendations in the civil
rights report that the Department of Agriculture recognizes
that entrenchment or that system. And the accountability I
guess is--we need to find a way where we are accountable.
They have made some recommendations. Any comments on any of
those recommendations that you have? That goes for any one of
you on that to think that they would--do you see the
recommendations that were in the civil rights report getting at
the accountability issue, where the rules of the Federal
Government now can be monitored and someone can be held
accountable for their action if they are found discriminating,
that someone above them can take----
* * * * *
Mr. Goodlatte. It is out of date, in other words?
Mrs. Clayton. It is out of date. And this is the handbook
that's precluding them from either serving on committees or for
being treated as a separate entity if they happen to be farmers
in that area.
Ms. Felzien. That's correct.
Mrs. Clayton. Would you bear with me to ask some other
questions?
Mr. Goodlatte. Yes. Without objection.
Mrs. Clayton. All right. Thank you.
I wanted to ask Mr. Windy Boy, as you noted in your
observation that you were willing to not foreclose on that. I
liked that little pun that you had. That was a little subtlety.
We didn't quite all understand it, but I appreciate that you
owned the land before we owned the land.
Given that, you raise in your testimony that because you
don't pay taxes, that you have found it difficult to get some
of the services that normally other citizens get, particularly
through the Extension Service. Am I misinterpreting that?
Mr. Windy Boy. Yes. In fact, we do pay taxes. All Tribes do
pay Federal taxes.
Sitting in the back there, in reference to the GAO report,
there was a county in Montana that has the Blackfeet Indian
Reservation as a part of it. I just want for the record that
that is not reflective of Indian country.
Mrs. Clayton. That particular----
Mr. Windy Boy. Right.
Mrs. Clayton. But are you having difficulty receiving
services from the--did I misread your testimony that I read
last evening? Are you having difficulty receiving services from
the Extension Service?
Mr. Windy Boy. Yes, we are.
Mrs. Clayton. What's the difficulty? And what's that based
on?
Mr. Windy Boy. Based on individual reports back to the
Intertribal Agriculture Council, headquarters office in
Billings.
Mrs. Clayton. Has there been any effort to resolve that
with Agriculture?
Mr. Windy Boy. Not as such yet.
Mrs. Clayton. Mr. Vue, I think you made the observation
that you are not subsidized, receive no guarantees. And
basically I share with you the product. And California is
always reminding us that their crops are unsubsidized. But
there is no reason why you shouldn't receive the right to make
an application for a loan or the right to make application for
disaster assistance or crop insurance as anyone else.
True, row crops and vegetables and fruits are not
subsidized as perhaps peanuts or--well, peanuts are not either;
that's what we say, I think that's what we say--or as wheat and
corn and others?
But what's the basis of it? They don't know you as a
farming group or is there something written that you want to
refer to us to look at as to why they are denying you the right
to make an application or----
Mr. Vue. Yes. The second question right after the same
question the chairman asked me, that people, USDA people at the
Farmers Home Administration, they ask you about what kind of
crop you plant, how many acres.
And when you tell them you're a strawberry farmer and you
tell the number of strawberries and they say, ``I don't think
you are qualified for the loan, but I don't think you have the
ability to fill out the Government paper. It's too much. And we
don't have staff here available to help you.''
Mrs. Clayton. That's what I'm responding to.
Mr. Vue. That's what they told us. And we have no choice.
Then just go home.
Mrs. Clayton. I'm responding to your answers that say there
is nothing, no basis in law that says that because you grow
strawberries that you're not eligible to make an application
unless they gave you something that you could help us. Because
you grow strawberries is not a basis for denying you the right
to have an application.
Mr. Vue. I don't quite understand what you're coming----
Mrs. Clayton. Doctor?
Mr. Chang. I think this is an example about discrimination
against Southeast Asians or Asians as a whole. I have my name
here, but even appalled. At the outside, it has taken us 20
years to come to this far today.
The amount throughout the country, we have many people. We
served before with the American armed forces, and we picked up
the American pilots. And now we even not get a chance to talk.
And back to your question, back in the old country, we are
farmers. I brought Mr. Pheng and a couple of former soldiers
here. They are farmers. They are farming in California and
Wisconsin, Minnesota, Florida.
And they do not get any support from the USDA, including
anything, like Mr. Pheng Vue mentioned, when you ask. And they
look at your face, look at your black hair. They don't want to
talk to us. That's why we come in here, Mr. Chairman.
And I hope that you take some time to listen to us. There
is no one out there listen to us. I served only last February
28 when they removed the national development on the
Government. We represent hundreds of organizations throughout
the country. We have 350,000.
And I just walked to the USDA office and testified with Mr.
Dan Glickman. And then Mr. Glickman assigned Mr. Schumacher to
visit Hmong in Fresno. So this is an example. This is the first
time in history for Hmong in Southeast Asia.
And I think you need to spend some time and listen to us. I
know that this is strong language, but we need your support.
Mrs. Clayton. Thank you.
Well, I think the reason you're here is that we want to
learn from you as well.
Mr. Boyd, did you submit the names or the lists of the
foreclosures that you said occurred since the moratorium?
Mr. Boyd. Yes, I did.
Mrs. Clayton. So it's part of your record. That's what I
just wanted to make sure.
Mr. Boyd. Right.
* * * * *
Finally, the amount of time FSA takes to process applications from
minority and nonminority farmers is about the same. Nationwide, from
October 1994 through March 1996, FSA took an average of 86 days to
process the applications of nonminority farmers and an average of 88
days to process those of minority farmers. More specifically, for
African Americans, FSA took 82 days; for Hispanic Americans and Native
Americans, 94 days; and for Asian Americans, 97 days.
TESTIMONY OF CHARLIE JONCHUE CHANG
Thank you Mr. Chairman and members of the committee for giving me
the opportunity to speak to you on behalf of the Hmong-American on the
subject of the Agricultural. My name is Charlie Jonchue Chang. I am the
interim executive director of Hmong National Development, Inc. base in
Washington, DC.
The word Hmong may sound very new to some of you. Let me make a
brief explain to you about who are the Hmong?. Hmong is an ethnic group
from Laos. In the earlier 1960's, Hmong was recruited by the U.S.
Central Intelligence Agency to pickup U.S. downed pilots and collected
intelligence information. After the United States pulled out from
Indochina in 1975, hundreds of thousands of Hmong had no place to go
but to escape Laos for Thailand and eventually moved on to settle into
third countries such as France, Canada, Australia, and mostly in the
United States.
Today, approximately 350,000 Hmong reside in the United States,
over 85,000 settled in the Central Valley California, over 75,000
settled in between the states of Minnesota and Wisconsin, and the rest
are scattered all over the United States.
Mr. Chairman, after arrival in this country in the mid 1970's, we
discovered that America is the land of opportunity and has lots of land
available for farming. Many of our people before fighting against the
communist along side by side with the U.S. special guerrilla force used
to be farmers. But after resettlement in this great country, we would
like to begin our new lives here as farmer again. Since the 1970's,
more American families left agricultural environment and move on to
joint the high tech business in the suburban areas. For this reason,
the United States depends more and more on foreign agricultural to
support our nation. We, the Hmong and Laotian, saw that there were
golden opportunities available to continue our farming skills that we
have left over in Laos to produce crops and agricultural goods to
support our great country, the United States.
Beginning in 1983, the Hmong in the Central Valley, California
first leased about 100 acres of land for farming. We produced only
Asian vegetables, Thai chili, and cherry tomatoes to support the local
Asian markets. Today, we own over 1000 acres of these lands and leased
more than 10,000 acres for farming. We produce just about everything
you see on the U.S. markets such as strawberries, cherry tomatoes,
greenbeans, longbeans, sugarpeas, bitter melon, eggplant, lemongrass,
Thai chili, ginseng, Asian rice, and other varieties of Asian
vegetables.
With all these efforts, we received no funding or support from the
U.S. Department of Agriculture. We simply operate our agricultural
businesses based on our natural experiences. For this reason, we face
many obstacles along our lives such as not knowing how to use
pesticide, improper use of chemical fertilizer and so on. There were
many incidents occurred to the community such as Mr. Gnia Vue Thao of
Fresno, CA died with chemical fertilizer poisoning and Mr. Kue Vue of
North Carolina was exposed to the pesticide. He too almost died.
According to a 1995 survey of the Fresno County, the Hmong
community views agriculture as its vehicle to becoming economically
self-sufficient. Based on the Hmong's agrarian background in Laos,
coupled with Fresno County's strong agricultural potential, agriculture
could be a good long-term and expanding source of income for the
community. I strongly agree with this survey. Today, over 6,500 acres
in Fresno County alone own by Southeast Asian farmers. Our farmers
produce a variety of labor intensive, specialty crops including
strawberries, cherry tomatoes, greenbeans, longbeans, sugar peas,
bittermelon, eggplant, lemongrass, Thai chili, and other varieties of
Asian vegetables. I am sure that our products have reached the markets
throughout the United States.
Mr. Chairman, throughout these years, our farmers have faced major
problems such as production, marketing, finance, program and budget,
and employment representation issues.
Production. Our farmers face major challenges associated with the
leasing of land, soil, quality and testing, production costs, generally
lower than average yield, fertilizer and pesticide usage, and labor
regulations. For the lack of English proficiency, our farmers are not
quite able to follow the production practices as recommended by the
Agriculture Department and local Government. Therefore, we face many
problems in this issue.
Marketing. Due to the lack of knowledge on the marketing issue, we
are attempting to capitalize on our comparative advantage--labor by
growing labor intensive crops. We could not utilize all of the
marketing opportunities available to us to increase the average value
of our crops. In order to reach higher-valued markets, we need the U.S.
Government to help us improving our post-harvest handling practices and
new varieties and crops that may provide better returns and produce a
year round supply of income.
Finance. Our farmers have not been able to obtain agricultural
credit in the short or long-term in order to expand our operations,
purchase land, equipment, and pursue marketing opportunities. There is
no financial institution willing to loan for long-term investment to
our community. We also generally do not qualify for Small Business
Association loan or meet the credit requirement for any type of loans.
For these reasons, we cannot expand our operations to the best of our
capability.
Program and Budget. I propose overall an agricultural economic
development cooperative program which would offer innovative solutions
to the problems identified as stated. I request a total of $15 million
budgeted to assist the Hmong and Laotian farmers. I would propose that
a Hmong national community-based organization such as the Hmong
National Development, Inc. (HND) through the collaboration of the U.S.
Department of Agriculture should be the non-governmental organization
to administer and implement the program over a 5 year period. I believe
that after the 5th year, this program can and should become financially
self-sustaining for 1,500 Hmong/Laotian farmers in California, 400 in
Minnesota, 600 in Wisconsin, 200 in North Carolina, and 50 in Florida.
Employment Representation. For all the reasons above and with the
lack of representation at the Government level, I propose that the U.S.
Department of Agriculture should hire at least two Hmong-American
individuals who are fluent in Hmong, Laotian, and of course English
languages to work for the Federal Government. These individuals will
certainly able to help Hmong and Laotian American farmers in various
functions regarding farming and regulations.
In conclusion, I believe that with your financial support and any
other type of assistance, we will definitely be able to help these new
American farmers in five major parts as described:
(1) Production
(2) Marketing
(3) Finance
(4) Program and budget
(5) Employment Representation
I believe that it is possible for us to improve our economic
situation if the U.S. Government would allocate the necessary funding
and resources to help us in the development of programs designed to
accelerate the farming and management of business related skills to our
people. These methods will guaranty many of our people get out of
public assistance and any other government dependency programs.
In return, I believe that by the year 2002, Hmong and Laotian
communities throughout the United States will be able to generate over
thousand jobs, reduce welfare dependency rate by 75 percent, increase
the sale of our products in the U.S. markets, export our products to
foreign countries as much as possible, and produce tax revenue millions
of dollars for our country.
May God bless you and the American people.
STATEMENT OF PHENG VUE
Thank you Mr. Chairman and members of the subcommittee for giving
me this opportunity to testify about agriculture. My name is Pheng Vue.
I am the president of the California Highlander Cooperative, Inc. I am
here to speak and represent this organization and the Southeast Asian
American community at the Central Valley California. I will speak on
the issue on behalf of our success, problems, struggle, and the needs
of the Southeast Asian farmers in the San Joaquin Valley, CA.
The word ``Southeast Asian'' composes three different ethnic
groups. They are: Hmong, Laotian, and Mien. So I will use the term of
``Southeast Asian'' or ``SEA'' in my speech to represent a more broader
perspective.
Mr. Chairman, about 15 years ago, many of us have sought of farming
project as our ways to make a living in this country. In 1980, there
were less then 30 Southeast Asian farmers in the San Joaquin Valley. In
1988, the numbers were increased up to about 800 farmers. Today, more
than 1,200 farmers are from the Southeast Asian community in the San
Joaquin Valley, CA. We produce strawberries, cherry tomatoes,
greenbeans, sugarpears, squash, and many varieties of Oriental
vegetables. The total production values are over $30 million each year.
The annual contribution to agribusiness in the San Joaquin Valley is
over $10 million from purchasing farm supplies, fertilizers, equipment,
seeds, plants, to the employment opportunity for the community.
Over the years, the SEA farmers in the San Joaquin Valley have
managed to overcome so many obstacles. In spite of our success, there
are many obstacles still to come if we are to grow and succeed to our
fullest potential.
We have many decade of experiences in the agribusiness from Laos to
the San Joaquin Valley. We are convinced that there are still
underdeveloped markets for our products. And with the help of the U.S.
Government, we will be able to produce more for the markets, both
domestic and international.
As I mentioned earlier, as farmers, SEA have faced major obstacles
along these years by not having the same opportunity of sharing profits
as other groups. SEA had no choice, but to sell our products to the
same brokers every year. That reason has left us at the mercy of the
marketing expertise of others. Each year, we did not have buyers as we
should, we resulted in losing tons of our products for not being able
to sell. If not, we ended up forced to sell tons of products at a
constant lower price than the prices originally quoted by the broker.
Every year, many of our SEA farmers face problems of over
production of cherry tomatoes, greenbeans, squash and many other
varieties of Oriental vegetables. Each year, farmers ended the year
with excessive products due to the brokers unwilling to find enough
markets. Therefore, the problems as mentioned are often compounded when
our farmers follow brokers and agencies recommendations to try new
varieties of crops. The brokers often sold large amount of seeds to our
farmers or sold us seeds for a new type of plant and promise to buy the
products. But year after year, the brokers failed to buy all these
products cost Hmong hundreds of thousands of dollars. Such practices
were not acceptable to anyone, but Hmong could not complain to any
officials or Hmong had no way of knowing who to complaint to.
There are only two companies in the San Joaquin Valley willing to
buy strawberries from SEA farmers. However, both of these companies ore
limited to purchasing large volume of products Hmong produced.
Therefore, at the present time, any farmer who wishes to grow different
varieties of strawberries, worries that the markets may not be suitable
for them to grow at the meantime. Thus, we need your help in finding
market place to purchase these products so that our people can begin
planting as they wished.
Financial and Government Support
SEA farmers have been farming in the San Joaquin Valley for over 15
years and we have never received any support from neither the local,
State, and Federal Government agencies; such as farm loan, loan
guarantees, nor farm disaster program.
In 1994, 16 SEA farmers suffered damage from the storm that
destroyed about 90 percent of their crops. Our farmers contacted many
Government agencies in the area, but none of them were responded. The
farmers also contacted the Farmers Home Administration in Fresno County
for assistance hopefully to qualify for receiving the Farm Disaster
Program and the Loan Guarantee Program, but at the end the answer was
no. The officials said that they had never heard of the SEA farmers and
they don't have staff available to help. The same problems continue
today.
SEA farmers have raised crops in the San Joaquin Valley for over 15
years. Despite the fact that we contribute over $10 million to the
local economy annually, the USDA reacts to us as though we don't exist.
They feeling of not necessary for us to do business with them. This is
sad considering that the most of our farmers are also U.S. citizens
just like any other Americans.
In the past, the Department of Health and Human Services, Office of
Refugee Resettlement, and the County of Fresno Department of Social
Service have funded some local nonprofit organizations to train welfare
recipients to become farmers. The trainees are recruited by way of
forcing and the trainers did not even have experience on farming
skills. All these programs are just wasted American tax dollars. This
funding would go to help improving the farmers' skills, at the end the
farmers should in return able to help the welfare recipients to become
self-sufficient[.]
Private lenders.
Despite SEA farmers producing a total value as indicated above each
year, many of us who have been banking at the same local banks over the
years, are still unable to apply for a line of credit, business loan,
or loan guarantee without something for collateral. For these reasons,
we ask for your help in giving us equal opportunity as any other
American citizens.
Technical Assistance.
Current technical assistance is being provided to SEA farmers by
nonprofit organizations and some investment corporations are strictly
funded by outsider marketing people, new varieties of crops and
management skills training, not from the U.S. Government. These
programs, while providing data for the trainers and specialist to
perpetuate themselves, do very little to help our farmers.
Often those individuals who run these programs, reported to the
USDA, as if they represent the SEA farmers when actually they don't
even speak the language and knowing what the community needs.
A good example of misinformation that caused major distress as
follows:
On January 12, 1997, the Department of Agriculture's Civil Rights
Listening Forum announced a public listening forum. Our California
Highlander Coop was not notified until January 15, 1997. When we called
to reserve a seat to speak at the Forum, we were told that someone
already reserved the rights to speak for the SEA farmers. The
individual claimed that he spoke on behalf of the Valley's Southeast
Asian farmers, but in fact he was from an organization based in San
Francisco. He also was not even a Southeast Asian origin. Therefore, we
request that from now on, there should be a direct contact between the
SEA farmers coop and government agencies. This is essential to limit
the mis-information and interpretation.
Based on the above concerns, we the SEA request our immediate needs
as follows:
The U.S. Department of Agriculture must hire at least two bilingual
Hmong individuals who are fluent in Hmong, Laotian, and of course,
English. These individuals should work closely with the SEA farmer
communities throughout the United States.
Funding for technical support to develop a marketing plan and
capabilities for new markets, domestic and abroad should be provide
equally for SEA.
Available funding for Southeast Asia farmers for loans with low
interest rates and without collateral.
Access to agricultural and SBA loans just like any other
qualified citizen.
Able access to Government farm disaster loan programs.
Fair share of government contracts to purchase agricultural
commodities.
Three to 5 year operating budget for the Co-op project for SEA.
In conclusion, the Board of Directors and all of the members of the
California Highlander Cooperative, are certain that with your help, we
want to produce goods for our people. We cannot depend on foreign goods
forever. Someone has to start to produce our own goods, and the SEA
farmers would like to share this profits and this success in developing
America a best place to live, to eat and to see. Not only for our own
generation, but for our children, grandchildren, and great-
grandchildren. So that they have a place to call ``America''.
We look forward to working with you and the U.S. Department of
Agriculture.
STATEMENT OF LARRY W. MITCHELL
Farmers Union's (NFU) leadership on civil rights, in an industry
which has not been known for its progressiveness in this area, began
many decades ago. Representing some 300,000 agriculture families, NFU
is very concerned when anyone's civil rights is threatened. Aubrey
Williams of the Alabama Farmers Union was one of our early leaders
concerned with civil rights.
When Franklin D. Roosevelt gave his first inaugural address,
Williams decided that he belonged to the New Deal team. He went to work
for the Reconstruction Finance Corporation in the South, where his
skills came to the attention of FDR advisor and confidante Harry
Hopkins.
Hopkins brought Williams onto the staff of the Federal Emergency
Relief Administration. There, Williams created the overall plan for the
Civil Works Administration and agitated for a program for jobs for
youth. This resulted in creation of the National Youth Administration
(NYA), which Williams was appointed to head.
At the same time, Hopkins kept Williams involved in the Works
Progress Administration (WPA). Williams appointed Blacks to his staff
and provoked some animosity, but he refused to observe a color line.
Arriving at a Birmingham luncheon for NYA workers, he found an all-
white assemblage, although he had ordered that no discrimination be
shown. The white workers were seated at the luncheon tables, and the
Black workers were standing along the walls. Williams refused to let
the luncheon proceed until tables were brought in for the Black NYA
workers.
``I want to say as a Southerner that I covenant that the Black man
shall have his share in a better life,'' Williams declared.
That covenant, made so many decades ago, remains a part of the
policy of National Farmers Union. As recently as last March at our 94th
Anniversary Convention in Cincinnati, Ohio, Farmers Union declared:
Although much has been accomplished to ensure freedom and equal
opportunity for all citizens, regardless of color, sex, or national
origin, much remains to be done.
* * * * *
______
Submitted Report by Hon. Jim Costa, a Representative in Congress from
California
The State of Socially Disadvantaged Farmers and Ranchers in
California's 16th Congressional District
Prepared for Representative Jim Costa (CA-16)
By Henry L. Munoz, District Office Fellow
February 2021
Overview
In this report, we draw information from conversations with
community leaders, cooperative advocates, and farm service providers.
The state of socially disadvantaged farmers in California's 16th
Congressional District is an important concern. The overall objective
is to illustrate the nuances disadvantage farmers and ranchers face
every day, and to offer a path forward through policy change.
Key Areas to Focus
1. Build awareness of, and support for farm bill/USDA policy
objectives--Disseminate information regarding opportunities
provided by, including, but not limited to, the United
States Department of Agriculture (USDA) and other Federal
agencies for socially disadvantaged farmers and ranchers.
2. Ensure socially disadvantaged farmers and ranchers are included
in policy discussions and implementation--Create a path to
include socially disadvantaged farmers and ranchers in the
development, adoption, implementation, and enforcement of
food and agriculture laws, regulations and policies and
programs.
3. Empower community outreach and technical assistance from
cooperatives to build more resilient communities--Provide a
voice to key non-government outreach centers and empower
them to play a more active role in strengthening public
awareness of socially disadvantaged farmers and ranchers;
emphasizing a bigger role--participation at local, state,
and government entities where decisions on disbursements of
resources are made.
Context
1. Support for socially disadvantaged farmers and ranchers continues
to evolve through many political and economic environments
but more than ever requires a holistic approach to increase
their awareness of USDA's programs and services.
2. Inadequate funding for outreach and technical assistance to
support small farms; specialty crops entering a broader
market must be addressed.
(a) Lenders have several incentives to lend to larger farms.
(1) Operators of smaller farms typically need smaller loans,
and making
many small loans is more time- and resource-
intensive than making
fewer, larger loans.
(2) Large farms often produce major commodities such as
corn, soy-
beans, and beef cattle, while small farms often
produce specialty
crops. Underwriting loans to large farms that
produce major com-
modities is easier and less risky because more data
are available on
the market for those products.
(3) Programs such as crop insurance are geared toward large,
major-
commodity farmers. These programs mitigate
repayment risk and
make lenders more likely to approve a loan or
provide more favorable
terms, such as lower interest rates, so it leaves
SDFRs without the
competitive edge to move into a broader market for
their produce.
(b) A United States Farm Bill that increases funding for the
USDA Farming
Opportunities, Training, and Outreach (FOTO) Program,
which includes
the Beginning Farmer and Rancher Development Program
(BFRDP) and
the Outreach and Assistance for Socially Disadvantaged
and Veteran
Farmers and Ranchers Program (known as the 2501
Program), would
provide funding support to organizations addressing
inequity in land ac-
cess and transition for SDFRs.
3. Socially disadvantaged farmers and ranchers require less
bureaucracy at local, state, and Federal Government to
address their challenges and provide much-needed support in
today's rapid economic change.
(a) The United States Government must take a bigger role in
promoting eco-
nomic growth and prosperity for SDFRs.
(b) GAO-19-539 (Jul. 2019) Information on Credit and Outreach to
SDFRs
is Limited. According to SDFR advocacy groups, lending
industry rep-
resentatives, and Federal officials, SDFRs are more
likely to operate
smaller, lower-revenue farms, have weaker credit
histories, or lack clear
title to their agricultural land, which can make it
difficult for them to
qualify for loans.
(c) SDFRs are more likely than other farmers and ranchers to
operate small
farms, which can make it difficult for them to qualify
for private credit.
According to data from the 2017 Census of Agriculture,
SDFRs rep-
resented 30 percent of primary producers but operated
39 percent of
farms smaller than 50 acres and 16 percent of farms 500
acres or larger.
(d) Difficulty meeting loan underwriting standards, SDFRs face
challenges
related to historical discrimination, ongoing unfair
treatment by lenders,
and a lack of familiarity with some programs and
technologies when try-
ing to obtain private agricultural credit
(e) There are circumstances that can limit use of the land as
collateral be-
cause of lending requirements or conventions that
require formal proof of
ownership or that disallow the use of a partial
ownership interest as se-
curity for a loan. SDFRs do not have a clear title to
their agricultural
land because the land was passed down informally from
generation to
generation without a will.
4. California farmers are some of the most diverse in the country;
they represent 35.1% of the country's Asian farmers, 14.6%
of Latino farmers, 21.9% of Native American farmers, and
4.9% of women farmers.
5. In California, less than 25% of farmers are female, and less than
2% of female farmers are women of color.
6. Uphill battle for socially disadvantaged farmers to comply with
many of the local, state, and Federal regulations (Example:
Irrigated Lands Regulatory Program (ILRP)).
(a) SDFRs with small-scale farms with a high diversity of crops
face par-
ticular challenges in complying with the Irrigated
Lands Regulatory Pro-
gram (ILRP). These challenges are especially difficult
for socially dis-
advantaged, immigrant, and refugee farmers, who may
speak only their
native language or have limited English.
(b) Currently, there is no funding for the level of outreach and
technical as-
sistance required to assist small farms with ILRP
reporting require-
ments, and appropriate reporting requirements have not
yet been devel-
oped.
7. Median total household income among all farm households ($83,111)
exceeded the median for all U.S. households ($68,703) in
2019.\1\ However, on average, socially disadvantaged
farmers and ranchers in California receive less in Federal
financial payments than their other ranchers/farmers
counterparts and earn much less in profits.
---------------------------------------------------------------------------
\1\ USDA Economic Research Service. (2020, December 18). Retrieved
from https://www.ers.usda.gov/data-products/ag-and-food-statistics-
charting-the-essentials/farming-and-farm-income/.
8. Socially disadvantaged farmers and ranchers are being critical to
the lack of U.S. funding to assist them to solve many of
their challenges. SDFRs face challenges using their
agricultural land as collateral. Many long-term
agricultural loans require the borrower to pledge land as
collateral to secure the transaction. For example, long-
term loans (up to 40 years) made by Farm Credit System
institution and FSA, must be secured by a first-position
lien on interests in real estate, generally enabling the
Farm Credit System and FSA to obtain ownership or control
---------------------------------------------------------------------------
of the land in the event of default.
9. USDA must continue to build public trust on agriculture policy
initiatives with SDFR.
10. Development of culturally appropriate educational programs is a
must and it requires more involvement from our community
based organizations and state and Federal agencies. For
example UC Cooperative Extension provides technical
assistance to small farmers.
11. Direct subsidy programs are geared toward larger commodities.
Audiences
1. Local, State and Federal Policymakers--Enormous commitments were
made in support of socially disadvantaged farmers and
ranchers through farm bills over the last 3 decades, but
these vastly increased resources have also come with too
many obstacles. Resources must be re-focused on the
attainment of these farm bills objectives.
2. Farm Services Agency (FSA)--USDA--To define success for our
socially disadvantaged farmers and ranchers; we must
graduate from traditional ways of assistance and become a
full partner with community outreach center for better
integration, planning, and programming of Federal
resources.
3. Local Outreach--Farm Cooperatives--There is currently no funding
for the level of outreach and technical assistance required
to assist socially disadvantaged farmers with many
reporting requirements; for example, East San Joaquin Water
Quality Coalition.
A Coordinated Approach to Improving Access to Government Resources
1. Support for socially disadvantaged farmers and ranchers must be a
coordinated approach that draws upon the expertise and
efforts of community leaders, cooperatives, local, state,
and Federal agencies.
2. Socially disadvantaged farmer and ranchers have a raw
infrastructure that simply need adequate government
resources through grants and loans that will eventually
harness new technology to raise their agricultural
productivity and provide a more stable, nutritious and
affordable food supply.
3. Local, state and Federal agencies must link programs and policies
for socially disadvantaged farmers and ranchers with
America's values; political will and assistance through
programs are values in actions.
Path Forward Through Policy Change
1. Strengthen U.S. Government Farm Bill: A Bill That Truly Supports
Socially Disadvantaged Farmers and Ranchers
Develop the Infrastructure
a. Reduce regulatory burden when asking for Federal resources;
ultimate mis-
sion is to empower socially disadvantaged farmer and
ranchers within their
rural communities that feed America.
b. Ensure socially disadvantaged farmer and rancher inclusion when
reporting
availability of resources (e.g., community outreach, FSA,
cooperatives,
CDFA).
c. Provide better e-connectivity to rural areas where socially
disadvantaged
farmer and ranchers operate from.
d. Establish an advisory board to exchange progress to help
develop the most
effective messaging and program offerings.
Align Other Programs
a. Work with FSA/USDA/OPPE/CDFA/Outreach coordinators to link farm
bill
objectives more closely to socially disadvantaged farmers
and ranchers' pri-
orities through professional, cultural exchanges,
subject-matter expertise,
and speaker programs on current financial assistance
program.
b. Coordinate with all level of government entities on outreach
campaigns; for
example, the Center of Community Prosperity, under the
USDA Office of
Partnerships and Public Engagements (OPPE) hosts outreach
and training
summits and capacity-building workshops to encourage a
sustainable devel-
opment process focusing on locally-driven, bottom-up
solutions addressing
challenges in rural and underserved communities.
Share Resources
a. Create socially disadvantaged farmer and rancher toolkit--these
include in-
formation on 2018 Farm Bill, fact sheets, testimonials/
success stories within
the CA-16 and/or other districts.
b. Provide information on additional state legislation; for
example, The Farmer
Equity Act (AB 1348), requires inclusion of socially
disadvantaged farmers
and ranchers to take part in the decision making of
implementation, en-
forcement of food and agriculture laws, regulations, and
policies and pro-
grams.\2\
---------------------------------------------------------------------------
\2\ CDFA Farmer Resource Portal--The Farm Equity Act. (2020
December 9). Retrieved from https://www.cdfa.ca.gov/farmer.resources/.
c. The 2501 Program has awarded 533 grants totaling more than $138
million.
This funding has helped reach socially disadvantaged
agricultural pro-
ducers--farmers and ranchers who have experienced
barriers to service due
to racial or ethnic prejudice.\3\
---------------------------------------------------------------------------
\3\ USDA Outreach and Assistance for Socially Disadvantaged Farmers
and Ranchers and Veteran Farmers and Ranchers Program (The 2501
Program). (2021 January 08). Retrieved from https://www.usda.gov/
partnerships/socially-disadvantaged-farmers-and-ranchers.
---------------------------------------------------------------------------
Capitalize on Key Events/Releases
a. Develop calendar of upcoming key events; media outlets (social
media, tele-
vision, internet, radio and newspaper print) wield
enormous influence in
shaping opinion and perceptions. Partnering with media
outlet infrastruc-
ture is key.
b. Incorporate socially disadvantaged farmer and rancher key
messages into
talking points during monthly/quarterly outreach
meetings.
c. Encourage more key local/state/Federal leadership to engage at
different so-
cially disadvantaged farm and ranch business locations.
This will allow for
open dialogue, unfettered debated, and freedom of
expression with many of
their challenges and concerns.
2. Shape Governmental Access to Resources Message
Hone the Message
a. Coordinate and work as a team at the community, local, state,
and Federal
level to nurture common interests and values between
socially disadvan-
taged farmers and ranchers and communities they
represent.
b. Provide socially disadvantaged ranchers and farmers with access
through
information sharing on management of grants, cooperative
agreements, and
other availability of local, state, and Federal financial
assistance.
c. Although farm bills have tailored policies in support of social
disadvan-
taged farmers and ranchers, in many cases these polices
remain absent in
the decision-making process for financial support. These
decisions have cre-
ated and upheld the inequities in our food system and
must be a part of
the bold, systemic change required to tackle these
challenges.
Tout Successes
a. Work with FSA, CDFA, USDA and other agencies to develop
testimonials
on successes across the state and our nation that focuses
on socially dis-
advantaged rancher and farmer programs.
b. Ensure inclusion of success stories of socially disadvantaged
ranchers and
farmers; speeches, websites/social media, outreach events
and to some ex-
tent Hill testimonies.
3. Empower Socially Disadvantaged Farmers and Ranchers
a. Increase funding for the 2501 Program; will allow for better USDA
Farming Opportunities, Training, and Outreach (FOTO)
Program. The 2501 Program also includes the Beginning
Farmer and Rancher Development Program (BFRDP) and the
Outreach and Assistance for Socially Disadvantaged and
Veteran Farmers and Ranchers Program.
b. There must be an improved and revised access to credit for
socially disadvantaged farmers and ranchers through the
Farm Service Agencies (FSA) within our CA-16 District.
c. Promote virtual exchanges between socially disadvantaged farmers
and ranchers with community leaders, outreach centers,
local, state, and Federal entities that focuses on
providing additional resources to supplement the 2018 Farm
Bill; either from local or state support.
______
Submitted Statements by Hon. Jim Costa, a Representative in Congress
from California
Statement 1
on behalf of will scott, j r., owner, scott family farms, founder,
african american farmers of california
My name is Will Scott, Jr. I am the owner of Scott Family Farms and
founder of the African-American Farmers of California. My brother and
son farm with me. We are a third generation family run farm. We farm 45
acres of vegetables including black-eyed peas, okra, spinach and other
vegetable crops.
Our family moved from Oklahoma, where my grandfather, father and
uncle were sharecroppers of 60 acres of land. My father moved to
California when I was a teenager in 1952. He and my brothers, Charles
and Melvin bought 5 acres and started Scott Family Farms. While I was
attending Reedley Junior College, I was drafted into the U.S. Navy
during my second year of college. I was in the Navy for 4 years and 7
months from 1961-66 as a Submarine Electronic Engineer. I am a Veteran
of the Vietnam War. Upon returning from the war, I came back to Fresno,
got married, had children and started working for the phone company as
an engineer designer for 30 years. Upon being offered early retirement,
I began farming in 1994. I was determined to keep the legacy of African
American Farmers alive and growing in California by introducing
Southern specialty crops back into Black communities to help stop
obesity and diabetes epidemics. I wanted to build healthy immune
systems to pass on to the next generation.
There was a Black Farmers organization prior to 1997, but farmers
had lost lots of land due to high interest rates and the economy was
seeing over 15% interest rates. Black farmers were being taken
advantage of and a group of about 30 farmers knew we must form an
organization to unite the existing Black farmers and participate in
food production in California and understand the rules and regulations
facing the farming community. We formed a nonprofit organization, the
African-American Farmers of California in 1997. The first President was
Al Smith. His family had been here since 1912. However, in 1998, the
organization elected me to be the President.
We have increased the size of the organization and have opened a 16
acre demonstration farm, (owned by the County of Fresno) which serves
as a testing area where new farmers can get hands-on experience growing
a variety of produce. Farmers can lease 1 or 2 acres and then take the
technology back to their own farm. Many of these small farmers are now
selling their own produce at Farmer[s'] Markets in Fresno and from the
Bay Area to Los Angeles.
Some of the issues at the present time include problems I have
encountered as a minority farmer. I have been denied getting into
markets and denied entry into many farmers['] markets. I was turned
down for a loan to put in a new water well. I had a farmer that offered
me a personal loan.
I went to the USDA-FSA to seek a loan for 40 acres of land. They
told me I would have to apply for a loan with five commercial banks and
be turned down by three of them. I was told by many of the banks that
the area the property was located was in a ``high-risk'' area, that
Western Fresno was ``red-lined'' as a poor area, that the area was in a
``hodge-podge'' area. I applied at Production Credit. They told me my
application looked good, but I never heard back from them. When I
returned to their office and my file was opened, it contained only two
pieces of paper. I could see they had not worked on my loan request. I
was told I would need 30% down to obtain the loan.
I returned to the USDA-FSA office and finally got the loan.
However, I had to put up 150% collateral of my assets. This included my
home and my 5 acres.
The members of the African-American Farmers of California are
fearful to apply for any loans, and do not want to deal with the
Government, as they feel they will lose everything they have. I have
encouraged them to apply for sensible programs that help to clean our
environment. The San Joaquin Valley Air Pollution Control District has
a program called a ``tractor trade up program,'' that allows the
replacement of an older tractor to be traded up for a cleaner burning
tractor with funding from the California Air Resources Board. Our
organization will continue to encourage programs to assist farmers.
I continue to advocate along side with the Nisei Farmers League on
issues of concern to the family communities. I will work with all
minority groups including Hispanic, Asian, Japanese-Americans, and
others. We must advocate together and interact with the United States
Department of Agriculture and our Congressmen.
Statement 2
on behalf of asian business institute & resource center
The Asian Business Institute & Resource Center (ABIRC)'s mission is
to build a strong network of Asian American business owners to promote
and advocate for the sustained success of Asian businesses in the
Central California region. ABIRC assists Southeast Asian (SEA) business
owners and farmers to access business and financial resources, develop
business plans, marketing, access non-traditional loans, and workshops
conducted in various languages. ABIRC advocates for small businesses
and farmers, provides technical assistance toward certifications for
various contractual opportunities, and many means of building capacity
within the SEA business community.
Issue, Problem or Need
It is estimated that there are over 1,000 independent SEA farmers
in California's Central Valley. This SEA community is, by and large,
considered a socially disadvantaged group with many barriers to access
the minimum resources that industrial-sized operations have at their
disposal. Access to culturally competent services and technical
assistance has always been a challenge to this group of small, minority
farmers who operate farms that are 10 acres or less; hence the name
``micro farmer.'' Even with barriers in place, they are a rapidly
growing segment of California's agricultural food chain and
contributors to the local, state and national agricultural economies.
SEA specialty crop farmers rely on the success of their small farms as
a means of income to sustain their families.
The COVID-19 pandemic decimated SEA micro farmers' operations. With
the closure of farmers' markets and grocery stores, they suddenly had
no income. ABIRC's SEA farmer census data, the largest dataset on SEA
farmers, revealed that micro farmers had not received any crisis relief
funding and were not aware of they existed. We attributed that to the
lack of dissemination of these efforts to ethnic communities and the
very definition of small business by the Small Business Administration
(500 employees or less). The USDA's definition of specialty crops
excluded many of the crops grown by SEA micro farmers. Public safety
policies to close offices restricted access to service providers
through phones manned by monolingual, not culturally competent staff
and webpages. These actions created yet another barrier to equity.
Traditional support through the SBA, USDA, NRCS, SBDC was limited, at
best. Similar scenarios were observed in county and state agricultural
agencies.
The first round of crisis relief dollars barely reached the SEA
micro farmers. The first dollars that reached ABIRC's constituents were
through philanthropy. It was not until later that actual government
relief dollars reached the SEA micro farmers through CARES dollars via
the City of Fresno. SEA micro farmers from Fresno, Merced, Stockton,
Sacramento and beyond would not have received any support without the
work of ABIRC stretching its already limited resources and partners.
Painful as it is to acknowledge, the majority of the resources to micro
farmers were from philanthropic dollars, not CARES dollars or direct
government relief dollars.
Because of the existing barriers and closure of traditional sales
markets, micro farmers are suffering. There have been numerous closures
of farms and farmer families' economies have been decimated. Long and
committed advocacy efforts from ABIRC and small farm organizations are
starting to create pathways, but there is much more that needs to be
done to mitigate the long-term negative impact of this pandemic on SEA
micro farmers. Direct mechanisms, intentional technical assistance, and
relief dollars need to reach this community who is subject to so many
barriers and, since the pandemic, more prejudice. Without direct
injection of assistance and intervention, a great piece of our local
economy and community will be disproportionately impacted. We want to
thank Congressman Costa's office for their continued advocacy and
efforts to try and serve, protect, and save the SEA micro farmers.
______
Submitted Memorandum by Hon. Alma S. Adams, a Representative in
Congress from North Carolina
Opinions of the Office of Legal Counsel of the United States Department
of Justice Consisting of Selected Memorandum Opinions Advising
the President of the United States, the Attorney General and
Other Executive Officers of the Federal Government in Relation
to Their Official Duties
Legal Guidance on the Implications of the Supreme Court's Decision in
Adarand Constructors, Inc. v. Pena *
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* Editor's note: this is an excerpt from the U.S. Department of
Justice report entitled, Opinions of the Office of Legal Counsel of the
United States Department of Justice Consisting of Selected Memorandum
Opinions Advising the President of the United States, the Attorney
General and Other Executive Officers of the Federal Government in
Relation to Their Official Duties, Volume 19, 1995. The report in its
entirety is retained in Committee file and is available at: https://
www.justice.gov/olc/file/626891/download.
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This memorandum sets forth preliminary legal guidance on the
implications of the Supreme Court's decision in Adarand
Constructors, Inc. v. Pena, which held that ``strict scrutiny''
is the standard that governs judicial review of the
constitutionality of Federal affirmative action programs that
use racial and ethnic criteria as a basis for decisionmaking.
The memorandum is not intended to serve as a definitive
statement of what Adarand means for any particular affirmative
action program; rather, it is intended to provide a general
overview of the Court's decision and the application of the
strict scrutiny standard in the context of affirmative action.
June 28, 1995
Memorandum Opinion to General Counsels
This memorandum sets forth preliminary legal guidance on the
implications of the Supreme Court's recent decision in Adarand
Constructors, Inc. v. Pena, 515 U.S. 200 (1995), which held that
Federal affirmative action programs that use racial and ethnic criteria
as a basis for decisionmaking are subject to strict judicial scrutiny.
The memorandum is not intended to serve as a definitive statement of
what Adarand means for any particular affirmative action program. Nor
does it consider the prudential and policy questions relevant to
responding to Adarand. Rather, it is intended to provide a general
overview of the Court's decision and the new standard for assessing the
constitutionality of Federal affirmative action programs.
Our conclusions can be briefly summarized. Adarand made applicable
to Federal affirmative action programs the same standard of review,
strict scrutiny, that City of Richmond v. J.A. Croson Co., 488 U.S. 469
(1989), applied to state and local affirmative action measures--with
the important caveat that, in this area, Congress may be entitled to
greater deference than state and local governments. Although Adarand
itself involved contracting, its holding is not confined to that
context; rather, it is clear that strict scrutiny will now be applied
by the courts in reviewing the Federal Government's use of race-based
criteria in health, education, hiring, and other programs as well.
The Supreme Court in Adarand was careful to dispel any suggestion
that it was implicitly holding unconstitutional all Federal affirmative
action measures employing racial or ethnic classifications. A majority
of the Justices rejected the proposition that ``strict scrutiny'' of
affirmative action measures means ``strict in theory, fatal in fact,''
and agreed that ``[t]he unhappy persistence of both the practice and
the lingering effects of racial discrimination against minority groups
in this country'' may justify the use of race-based remedial measures
in certain circumstances. 515 U.S. at 237. See id. at 268 (Souter, J.,
dissenting); id. at 273 (Ginsburg, J., dissenting). Only two Justices
advocated positions that approach a complete ban on affirmative action.
The Court's decision leaves many questions open--including the
constitutionality of the very program at issue in the case. The Court
did not discuss in detail the two requirements of strict scrutiny: the
governmental interest underlying an affirmative action measure must be
``compelling'' and the measure must be ``narrowly tailored'' to serve
that interest. As a consequence, our analysis of Adarand's effects on
Federal action must be based on Croson and the lower court decisions
applying strict scrutiny to state and local programs. It is unclear,
however, what differences will emerge in the application of strict
scrutiny to affirmative action by the national government; in
particular, the Court expressly left open the question of what
deference the judiciary should give to determinations by Congress that
affirmative action is necessary to remedy discrimination against racial
and ethnic minority groups. Unlike state and local governments,
Congress may be able to rely on national findings of discrimination to
justify remedial racial and ethnic classifications; it may not have to
base such measures on evidence of discrimination in every geographic
locale or sector of the economy that is affected. On the other hand, as
with state and local governments under Croson, Congress may not
predicate race-based remedial measures on generalized, historical
societal discrimination.
Two additional questions merit mention at the outset. First, the
Court has not resolved whether a governmental institution must have
sufficient evidence of discrimination to establish a compelling
interest in engaging in race-based remedial action before it takes such
action. A number of courts of appeals have considered this question in
reviewing state and local affirmative action plans after Croson, and
all have concluded that governments may rely on ``post-enactment''
evidence--that is, evidence that the government did not consider when
adopting the measure, but that reflects evidence of discrimination
providing support for the government's determination that remedial
action was warranted at the time of adoption. Those courts have said
that the government must have had some evidence of discrimination when
instituting an affirmative action measure, but that it need not marshal
all the supporting evidence at that time. Second, while Adarand makes
clear that remedying past discrimination will in some circumstances
constitute a compelling interest sufficient to justify race-based
measures, the Court did not address the constitutionality of programs
aimed at advancing nonremedial objectives--such as promoting diversity
and inclusion. For example, under Justice Powell's controlling opinion
in Regents of the Univ. of Calif, v. Bakke, 438 U.S. 265 (1978),
increasing the racial and ethnic diversity of the student body at a
university constitutes a compelling interest, because it enriches the
academic experience on campus. Under strict scrutiny, it is uncertain
whether and in what settings diversity is a permissible goal of
affirmative action beyond the higher education context. To the extent
that affirmative action is used to foster racial and ethnic diversity,
the government must seek some further objective beyond the achievement
of diversity itself.
Our discussion in this memorandum proceeds in four steps. In
Section I, we analyze the facts and holding of Adarand itself, the
scope of what the Court did decide, and the questions it left
unanswered. Section II addresses the strict scrutiny standards as
applied to state and local programs in Croson and subsequent lower
court decisions; we consider the details of both the compelling
interest and the narrow tailoring requirements Croson mandated. In
Section III, we turn to the difficult question of how precisely the
Croson standards should apply to Federal programs, with a focus on the
degree of deference courts may give to congressional determinations
that affirmative action is warranted. Finally, in an appendix, we
sketch out a series of questions that should be considered in analyzing
the validity under Adarand of Federal affirmative action programs that
employ race or ethnicity as a criterion. The appendix is intended to
guide agencies as they begin that process.
I. The Adarand Case
A. Facts
Adarand involved a constitutional challenge to a Department of
Transportation (``DOT'') program that compensates persons who receive
prime government contracts if they hire subcontractors certified as
small businesses controlled by ``socially and economically
disadvantaged'' individuals. The legislation on which the DOT program
is based, the Small Business Act, establishes a government-wide goal
for participation of such concerns at ``not less than 5 percent of the
total value of all prime contract and subcontract awards for each
fiscal year.'' 15 U.S.C. 644(g)(1). The Act further provides that
members of designated racial and ethnic minority groups are presumed to
be socially disadvantaged. Id. 637(a)(5), 637(d)(2), (3); 13 CFR
124.105(b)(1).\1\ The presumption is rebuttable. 13 CFR 124.111(c)-
(d), 124.601-124.609.\2\
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\1\ The following groups are entitled to the presumption: African
American; Hispanic; Asian Pacific; Subcontinent Asian; and Native
American. See Adarand, 515 U.S. at 205. This list of eligible groups
parallels that of many Federal affirmative action programs.
\2\ DOT also uses the subcontractor compensation mechanism in
implementing the Surface Transportation and Uniform Relocation
Assistance Act of 1987 (``STURAA''), Pub. L. No. 100-17, 106(c)(1),
101 Stat. 145, and its successor, the Intermodal Surface Transportation
Efficiency Act of 1991 (``ISTEA''), Pub. L. No. 102-240, 1003(b), 105
Stat. 1919-22. Both laws provide that ``not less than 10 percent'' of
funds appropriated thereunder ``shall be expended with small business
concerns owned and controlled by socially and economically
disadvantaged individuals.'' STURAA and ISTEA adopt the Small Business
Act's definition of ``socially and economically disadvantaged
individual,'' including the applicable race-based presumptions.
Adarand, 515 U.S. at 208.
---------------------------------------------------------------------------
In Adarand, a nonminority firm submitted the low bid on a DOT
subcontract. However, the prime contractor awarded the subcontract to a
minority-owned firm that was presumed to be socially disadvantaged;
thus, the prime contractor received additional compensation from DOT.
515 U.S. at 205. The nonminority firm sued DOT, arguing that it was
denied the subcontract because of a racial classification, in violation
of the equal protection component of the Fifth Amendment's Due Process
Clause. The district court granted summary judgment for DOT. The Court
of Appeals for the Tenth Circuit affirmed, holding that DOT's race-
based action satisfied the requirements of ``intermediate scrutiny,''
which it determined was the applicable standard of review under the
Supreme Court's rulings in Metro Broad., Inc. v. FCC, 497 U.S. 547
(1990), and Fullilove v. Klutznick, 448 U.S. 448 (1980). See Adarand,
515 U.S. at 210.
B. The Holding
By a five-four vote, in an opinion written by Justice O'Connor, the
Supreme Court held in Adarand that strict scrutiny is now the standard
of constitutional review for Federal affirmative action programs that
use racial or ethnic classifications as the basis for decisionmaking.
The Court made clear that this standard applies to programs that are
mandated by Congress, as well as those undertaken by government
agencies on their own accord. 515 U.S. at 227. The Court overruled
Metro Broadcasting to the extent that it had prescribed a more lenient
standard of review for Federal affirmative action measures. Id.\3\
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\3\ Justice O'Connor (along with three other Justices) had
dissented in Metro Broadcasting and urged the adoption of strict
scrutiny as the standard of review for Federal affirmative action
measures.
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Under strict scrutiny, a racial or ethnic classification must serve
a ``compelling interest'' and must be ``narrowly tailored'' to serve
that interest. Id.\4\ This is the same standard of review that, under
the Supreme Court's decision in City of Richmond v. J.A. Croson Co.,
488 U.S. 469 (1989), applies to affirmative action measures adopted by
state and local governments. It is also the same standard of review
that applies to government classifications that facially discriminate
against minorities. Adarand, 515 U.S. at 221-24.
---------------------------------------------------------------------------
\4\ A classification reviewed under intermediate scrutiny need only
(i) serve an ``important'' governmental interest and (ii) be
``substantially related'' to the achievement of that objective. Metro
Broad., 497 U.S. at 564-65.
---------------------------------------------------------------------------
In a portion of her opinion joined by Chief Justice Rehnquist,
Justice Kennedy, and Justice Thomas, Justice O'Connor sought to
``dispel the notion that strict scrutiny is `strict in theory, but
fatal in fact' '' when it comes to affirmative action. Id. at 237
(quoting Fullilove, 448 U.S. at 519 (Marshall, J., concurring in the
judgment)). While that familiar maxim doubtless remains true with
respect to classifications that, on their face, single out racial and
ethnic minorities for invidious treatment,\5\ Justice O'Connor's
opinion declared that the Federal Government may have a compelling
interest to act on the basis of race to overcome the ``persistence of
both the practice and lingering effects of racial discrimination
against minority groups in this country.'' Id. In this respect, Justice
O'Connor's opinion in Adarand tracks her majority opinion in Croson.
There, too, the Court declined to interpret the Constitution as
imposing a flat ban on affirmative action by state and local
governments. 488 U.S. at 509-11.
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\5\ See, e.g., McLaughlin v. Florida, 379 U.S. 184, 192 (1964)
(racial and ethnic classifications that single out minorities for
disfavored treatment are in almost all circumstances ``irrelevant to
any constitutionally acceptable legislative purpose'') (internal
quotations omitted); Loving v. Virginia, 388 U.S. 1, 11 (1967) (``There
is patently no legitimate overriding purpose independent of invidious
racial discrimination which justifies'' state law that prohibited
interracial marriages).
---------------------------------------------------------------------------
Two members of the Adarand majority, Justices Scalia and Thomas,
wrote separate concurring opinions in which they took a more stringent
position. Consistent with his concurring opinion in Croson, Justice
Scalia would have adopted a near-absolute constitutional bar to
affirmative action. Taking issue with Justice O'Connor's proposition
that racial classifications may be employed in certain circumstances to
remedy discrimination against minorities, Justice Scalia stated that
the ``government can never have a `compelling interest' in
discriminating on the basis of race in order to `make-up' for past
racial discrimination in the opposite direction.'' Adarand, 515 U.S. at
239 (Scalia, J., concurring in part and concurring in the judgment).\6\
According to Justice Scalia, ``[individuals who have been wronged by
unlawful racial discrimination should be made whole; but under our
Constitution there can be no such thing as either a creditor or a
debtor race. That concept is alien to the Constitution's focus on the
individual . . . .'' Id. The compensation of victims of specific
instances of discrimination through ``make-whole'' relief, which
Justice Scalia accepts as legitimate, is not affirmative action, as
that term is generally understood. Affirmative action is a group-based
remedy: where a group has been subject to discrimination, individual
members of the group can benefit from the remedy, even if they have not
proved that they have been discriminated against personally.\7\ Justice
O'Connor's treatment of affirmative action in Adarand is consistent
with this understanding.
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\6\ In his Croson concurrence. Justice Scalia said that he believes
that ``there is only one circumstance in which the States may act by
race to `undo the effects of past discrimination': where that is
necessary to eliminate their own maintenance of a system of unlawful
racial classification.'' 488 U.S. at 524 (Scalia, J., concurring in the
judgment). For Justice Scalia, ``[t]his distinction explains [the
Supreme Court's] school desegregation cases, in which [it has] made
plain that States and localities sometimes have an obligation to adopt
race-conscious remedies.'' Id. The school desegregation cases are
generally not thought of as affirmative action cases, however. Outside
of that context, Justice Scalia indicated that he believes that ``[a]t
least where state or local action is at issue, only a social emergency
rising to the level of imminent danger to life and limb . . . can
justify an exception to the principle embodied in the Fourteenth
Amendment that our Constitution is color-blind.'' Id. at 521.
\7\ See Local 28, Sheet Metal Workers' Int'l Ass'n v. EEOC, 478
U.S. 421, 482 (1986); Wygant v. Jackson Bd. of Educ., 476 U.S. 267,
277-78 (1986) (plurality opinion), id. at 287 (O'Connor, J.,
concurring).
---------------------------------------------------------------------------
Although Justice Thomas joined the portion of Justice O'Connor's
opinion holding that the government's interest in redressing the
effects of discrimination can be sufficiently compelling to warrant the
use of remedial racial and ethnic classifications, he apparently agrees
with Justice Scalia's rejection of the group-based approach to
remedying discrimination. Justice Thomas stated that the ``government
may not make distinctions on the basis of race,'' and that it is
``irrelevant whether a government's racial classifications are drawn by
those who wish to oppress a race or by those who have a sincere desire
to help those thought to be disadvantaged.'' Id. at 240 (Thomas, J.,
concurring in part and concurring in the judgment).
The four dissenting Justices in Adarand (Justices Stevens, Souter,
Ginsburg, and Breyer) \8\ would have reaffirmed the intermediate
scrutiny standard of review for congressionally authorized affirmative
action measures established in Metro Broadcasting, and would have
sustained the DOT program on the basis of Fullilove, where the Court
upheld Federal legislation requiring grantees to use at least ten
percent of certain grants for public works projects to procure goods
and services from minority businesses. Justices Stevens and Souter
argued that the DOT program was more narrowly tailored than the
legislation upheld in Fullilove. Adarand, 515 U.S. at 259-64 (Stevens,
J., dissenting); id. at 266-67 (Souter. J., dissenting). All four
dissenters stressed that there is a constitutional distinction between
racial and ethnic classifications that are designed to aid minorities
and classifications that discriminate against them. As Justice Stevens
put it, there is a difference between a ``No Trespassing'' sign and a
``welcome mat.'' Id. at 245 (Stevens, J., dissenting). See id. (``[a]n
attempt by the majority to exclude members of a minority race from a
regulated market is fundamentally different from a [race-based] subsidy
that enables a relatively small group of [minorities] to enter that
market''); see also id. at 270 (Souter, J., dissenting); id. at 275-76
(Ginsburg, J., dissenting). For the dissenters, Justice O'Connor's
declaration that strict scrutiny of affirmative action programs is not
``fatal in fact'' signified a ``common understanding'' among a majority
of the Court that those differences do exist, and that affirmative
action may be entirely proper in some cases. Id. at 271, 275 (Ginsburg,
J., dissenting). In Justice Ginsburg's words, the ``divisions'' among
the Justices in Adarand ``should not obscure the Court's recognition of
the persistence of racial inequality and a majority's acknowledgment of
Congress' authority to act affirmatively, not only to end
discrimination, but also to counteract discrimination's lingering
effects.'' Id. at 273. The dissenters also emphasized that there is a
``significant difference between a decision by the Congress of the
United States to adopt an affirmative-action program and such a
decision by a State or a municipality.'' Id. at 249 (Stevens, J.,
dissenting); id. at 264 (Souter, J., dissenting). They stressed that
unlike state and local governments, Congress enjoys express
constitutional power to remedy discrimination against minorities;
therefore, it has more latitude to engage in affirmative action than do
state and local governments. Id. at 255 (Stevens, J., dissenting).
Justice Souter noted that the majority opinion did not necessarily
imply a contrary view. Id. at 268-69 (Souter, J., dissenting).
---------------------------------------------------------------------------
\8\ Justice Stevens wrote a dissenting opinion that was joined by
Justice Ginsburg. Justice Souter wrote a dissenting opinion that was
joined by Justices Ginsburg and Breyer. And Justice Ginsburg wrote a
dissenting opinion that was joined by Justice Breyer.
---------------------------------------------------------------------------
Thus, there were at most two votes in Adarand (Justices Scalia and
Thomas) for anything that approaches a blanket prohibition on race-
conscious affirmative action. Seven justices confirmed that Federal
affirmative action programs that use race or ethnicity as a decisional
factor can be legally sustained under certain circumstances.
C. Scope of Adarand
Although Adarand involved government contracting, it is clear from
the Supreme Court's decision that the strict scrutiny standard of
review applies whenever the Federal Government voluntarily adopts a
racial or ethnic classification as a basis for decisionmaking.\9\ Thus,
the impact of the decision is not confined to contracting, but will
reach race-based affirmative action in health and education programs,
and in Federal employment.\10\ Furthermore, Adarand was not a ``quota''
case: its standards will apply to any classification that makes race or
ethnicity a basis for decisionmaking.\11\ Mere outreach and recruitment
efforts, however, typically should not be subject to the Adarand
standards. Indeed, post-Croson cases indicate that such efforts are
considered race-neutral means of increasing minority opportunity.\12\
In some sense, of course, the targeting of minorities through outreach
and recruitment campaigns involves race-conscious action. But the
objective there is to expand the pool of applicants or bidders to
include minorities, not to use race or ethnicity in the actual
decision. If the government does not use racial or ethnic
classifications in selecting persons from the expanded pool, Adarand
ordinarily would be inapplicable.\13\
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\9\ By voluntary affirmative action, we mean racial or ethnic
classifications that the Federal Government adopts on its own
initiative, through legislation, regulations, or internal agency
procedures. This should be contrasted with affirmative action that is
undertaken pursuant to a court-ordered remedial directive in a race
discrimination lawsuit against the government, or pursuant to a court-
approved consent decree settling such a suit. Prior to Croson, the
Supreme Court had not definitely resolved the standard of review for
court-ordered or court-approved affirmative action. See United States
v. Paradise, 480 U.S. 149 (1987) (court order); Local 93. Int'l Ass'n
of Firefighters v. City of Cleveland, 478 U.S. 501 (1986) (consent
decree) The Court has not revisited the issue since Croson was decided.
Lower courts have applied strict scrutiny to affirmative action
measures in consent decrees. See, e.g., Stuart v. Roache, 951 F.2d 446,
449 (1st Cir. 1991) (Breyer, J.) cert. denied, 504 U.S. 913 (1992).
\10\ Title VII of the 1964 Civil Rights Act is the principal
Federal employment discrimination statute. The Federal Government is
subject to its strictures. See 42 U.S.C. 2000e-17. The Supreme Court
has held that the Title VII restrictions on affirmative action in the
workplace are somewhat more lenient than the constitutional
limitations. See Johnson v. Transportation Agency, 480 U.S. 616, 627-28
n.6 (1987). But see id. at 649 (O'Connor, J., concurring in the
judgment) (expressing view that Title VII standards for affirmative
action should be ``no different'' from constitutional standards).
\11\ We do not believe that Adarand calls into question Federal
assistance to historically-Black colleges and universities.
\12\ See, e.g., Peightal v. Metropolitan Dade County, 26 F.3d 1545,
1557-58 (11th Cir. 1994); Billish v. City of Chicago, 962 F.2d 1269,
1290 (7th Cir. 1992), vacated on other grounds, 989 F.2d 890 (7th Cir.)
(en banc), cert. denied, 510 U.S. 908 (1993); Coral Constr. Co. v. King
County, 941 F.2d 910, 923 (9th Cir. 1991), cert. denied, 502 U.S. 1033
(1992).
\13\ Outreach and recruitment efforts conceivably could be viewed
as race-based decisionmaking of the type subject to Adarand if such
efforts work to create a ``minorities-only'' pool of applicants or
bidders, or if they are so focused on minorities that nonminorities are
placed at a significant competitive disadvantage with respect to access
to contracts, grants, or jobs.
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Adarand does not require strict scrutiny review for programs
benefitting Native Americans as members of federally recognized Indian
Tribes. In Morton v. Mancari, 417 U.S. 535 (1974), the Supreme Court
applied rational basis review to a hiring preference in the Bureau of
Indian Affairs for members of federally recognized Indian Tribes. The
Court reasoned that a Tribal classification is ``political rather than
racial in nature,'' because it is ``granted to Indians not as a
discrete racial group, but, rather, as members of quasi-sovereign
Tribal entities.'' Id. at 554. See id. at 553 n. 24.
Adarand did not address the appropriate constitutional standard of
review for affirmative action programs that use gender classifications
as a basis for decisionmaking. Indeed, the Supreme Court has never
resolved the matter.\14\ However, both before and after Croson, nearly
all circuit court decisions have applied intermediate scrutiny to
affirmative action measures that benefit women.\15\ The Sixth Circuit
is the only court that has equated racial and gender classifications:
purporting to rely on Croson, it held that gender-based affirmative
action measures are subject to strict scrutiny.\16\ That holding has
been criticized by other courts of appeals, which have correctly
pointed out that Croson does not speak to the appropriate standard of
review for such measures.\17\
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\14\ The lone gender-based affirmative action case that the Supreme
Court has decided is Johnson v. Transportation Agency, 480 U.S. 616
(1987). But Johnson only involved a Title VII challenge to the use of
gender classifications--no constitutional claim was brought. Id. at 620
n. 2. And as indicated above (see supra note 10), the Court in Johnson
held that the Title VII parameters of affirmative action are not
coextensive with those of the Constitution.
\15\ See, e.g., Ensley Branch, NAACP v. Seibels, 31 F.3d 1548,
1579-80 (11th Cir. 1994); Contractors Ass'n v. City of Philadelphia, 6
F.3d 990, 1009-10 (3d Cir. 1993); Lamprecht v. FCC, 958 F.2d 382, 391
(D.C. Cir. 1992) (Thomas, J.); Coral Constr. Co, v. King County, 941
F.2d at 930-31; Associated Gen. Contractors v. City and County of San
Francisco, 813 F.2d 922, 939 (9th Cir. 1987).
\16\ See Conlin v. Blanchard, 890 F.2d 811, 816 (6th Cir. 1989);
see also Brunet v. City of Columbus, 1 F.3d 390, 404 (6th Cir. 1993),
cert. denied, 510 U.S. 1164 (1994).
\17\ See, e.g., Seibels, 31 F.3d at 1580.
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D. Open Questions on Remand
Adarand did not determine the constitutionality of any particular
Federal affirmative action program. In fact, the Supreme Court did not
determine the validity of the Federal legislation, regulations, or
program at issue in Adarand itself. Instead, the Court remanded the
case to the Tenth Circuit for a determination of whether the measures
satisfy strict scrutiny.
Adarand left open the possibility that, even under strict scrutiny,
programs statutorily prescribed by Congress may be entitled to greater
deference than programs adopted by state and local governments. This is
a theme that some of the Justices had explored in prior cases. For
example, in a portion of her Croson opinion joined by Chief Justice
Rehnquist and Justice White, Justice O'Connor wrote that Congress may
have more latitude than state and local governments in utilizing
affirmative action. And in his concurrence in Fullilove, Justice
Powell, applying strict scrutiny, upheld a congressionally mandated
program, and in so doing, said that he was mindful that Congress
possesses broad powers to remedy discrimination nationwide. In any
event, in Adarand, the Court said that it did not have to resolve
whether and to what extent courts should pay special deference to
Congress in evaluating Federal affirmative action programs under strict
scrutiny.
Aside from articulating the components of the strict scrutiny
standard, the Court's decision in Adarand provides little explanation
of how the standard should be applied. For more guidance, one needs to
look to Croson and lower court decisions applying it. That exercise is
important because Adarand basically extends the Croson rules of
affirmative action to the Federal level--with the caveat that
application of those rules might be somewhat less stringent where
affirmative action is undertaken pursuant to congressional mandate.
II. The Croson Standards
In Croson, the Supreme Court considered a constitutional challenge
to a Richmond, Virginia ordinance that required prime contractors who
received city contracts to subcontract at least thirty percent of the
dollar amount of those contracts to businesses owned and controlled by
members of specified racial and ethnic minority groups--commonly known
as minority business enterprises (``MBEs''). The asserted purpose of
Richmond's ordinance was to remedy discrimination against minorities in
the local construction industry.
Croson marked the first time that a majority of the Supreme Court
held that race-based affirmative action measures are subject to strict
scrutiny.\18\ Justice O'Connor's opinion in Croson \19\ said that ``the
purpose of strict scrutiny is to `smoke out' illegitimate uses of race
by assuring that the legislative body is pursuing a goal important
enough to warrant use of a highly suspect tool. The test also ensures
that the means chosen `fit' this compelling goal so closely that there
is little or no possibility that the motive for the classification was
illegitimate racial prejudice or stereotype.'' 488 U.S. at 493
(plurality opinion). See also id. at 520 (Scalia, J., concurring in the
judgment) (``[S]trict scrutiny must be applied to all governmental
classifications by race, whether or not its asserted purpose is
`remedial' or `benign.' ''). In short, the compelling interest inquiry
centers on ``ends'' and asks why the government is classifying
individuals on the basis of race or ethnicity; the narrow tailoring
inquiry focuses on ``means'' and asks how the government is seeking to
meet the objective of the racial or ethnic classification.
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\18\ Croson was decided by a 6-3 vote. Five of the Justices in the
majority (Chief Justice Rehnquist, and Justices White, O'Connor,
Scalia, and Kennedy) concluded that strict scrutiny was the applicable
standard of review. Justice Stevens concurred in part and concurred in
the judgment, but consistent with his long-standing views, declined to
``engag[e] in a debate over the proper standard of review to apply in
affirmative-action litigation.'' 488 U.S. at 514 (Stevens, concurring
in part and concurring in the judgment).
\19\ Justice O'Connor's opinion was for a majority of the Court in
some parts, and for a plurality in others.
---------------------------------------------------------------------------
Applying strict scrutiny, the Court held that (a) the Richmond MBE
program did not serve a ``compelling interest'' because it was
predicated on insufficient evidence of discrimination in the local
construction industry, and (b) it was not ``narrowly tailored'' to the
achievement of the city's remedial objective.
A. Compelling Governmental Interest
1. Remedial Objectives
Justice O'Connor's opinion in Croson stated that remedying the
identified effects of past discrimination may constitute a compelling
interest that can support the use by a governmental institution of a
racial or ethnic classification. This discrimination could fall into
two categories. First, the government can seek to remedy the effects of
its own discrimination. Second, the government can seek to remedy the
effects of discrimination committed by private actors within its
jurisdiction, where the government becomes a ``passive participant'' in
that conduct, and thus helps to perpetuate a system of exclusion. 488
U.S. at 492 (plurality opinion); id. at 519 (Kennedy, J., concurring in
part and concurring in the judgment). In either category, the remedy
may be aimed at ongoing patterns and practices of exclusion, or at the
lingering effects of prior discriminatory conduct that has ceased. See
Adarand, 515 U.S. at 269 (Souter, J., dissenting) (``The Court has long
accepted the view that constitutional authority to remedy past
discrimination is not limited to the power to forbid its continuation,
but extends to eliminating those effects that would otherwise persist
and skew the operation of public systems even in the absence of current
intent to practice any discrimination.'').
Croson requires the government to identify with precision the
discrimination to be remedied. The fact and legacy of general,
historical societal discrimination is an insufficient predicate for
affirmative action: ``While there is no doubt that the sorry history of
both private and public discrimination in this country has contributed
to a lack of opportunities for Black entrepreneurs, this observation,
standing alone, cannot justify a rigid racial quota in the awarding of
public contracts in Richmond, Virginia.'' 488 U.S. at 499. See id. at
505 (``To accept Richmond's claim that past societal discrimination
alone can serve as the basis for rigid racial preferences would be to
open the door to competing claims for `remedial relief' for every
disadvantaged group.''). Similarly, ``amorphous'' claims of
discrimination in certain sectors and industries are inadequate. Id. at
499 (``[A]n amorphous claim that there has been past discrimination in
a particular industry cannot justify the use of an unyielding racial
quota.''). Such claims ``provide[] no guidance for [the government] to
determine the precise scope of the injury it seeks to remedy,'' and
would have ``no logical stopping point.'' Id. at 498 (internal
quotations omitted). The Court indicated that its requirement that the
government identify with specificity the effects of past discrimination
anchors remedial affirmative action measures in the present. It
declared that ``[i]n the absence of particularized findings'' of
discrimination, racial and ethnic classifications could be ``ageless in
their reach into the past, and timeless in their ability to affect the
future.'' Id. (internal quotations omitted).
The Court in Croson did not require a judicial determination of
discrimination in order for a state or local government to adopt
remedial racial or ethnic classifications. Rather, relying on Justice
Powell's plurality opinion in Wygant v. Jackson Bd. of Educ., 476 U.S.
267 (1986), the Court said that the government must have a `` `strong
basis in evidence for its conclusion that remedial action was
necessary.' '' Croson, 488 U.S. at 500 (quoting Wygant, 476 U.S. at
277). The Court then suggested that this evidence should approach ``a
prima facie case of a constitutional or statutory violation'' of the
rights of minorities. 488 U.S. at 500.\20\ Notably, the Court said that
significant statistical disparities between the level of minority
participation in a particular field and the percentage of qualified
minorities in the applicable pool could permit an inference of
discrimination that would support the use of racial and ethnic
classifications intended to correct those disparities. Id. at 507. See
id. at 501 (``There is no doubt that where gross statistical
disparities can be shown, they alone in a proper case may constitute
prima facie proof of a pattern or practice of discrimination.'')
(internal quotations omitted). But the Court said that a mere
underrepresentation of minorities in a particular sector or industry
when compared to general population statistics is an insufficient
predicate for affirmative action. Id. (``When special qualifications
are required to fill particular jobs, comparisons to the general
population (rather than to the smaller group of individuals who may
possess the necessary qualifications) may have little probative
value.'') (internal quotations omitted).
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\20\ Lower courts have consistently said that Croson requires
remedial affirmative action measures to be supported by a ``strong
basis in evidence'' that such action is warranted. See, e.g., Peightal,
26 F.3d at 1553; Concrete Works v. City and County of Denver, 36 F.3d
1513, 1521 (10th Cir. 1994), cert. denied, 514 U.S. 1004 (1995);
Donaghy v. City of Omaha, 933 F.2d 1448, 1458 (8th Cir.), cert. denied,
502 U.S. 1059 (1991). Some courts have said that this evidence should
rise to the level of prima facie case of discrimination against
minorities. See, e.g., O'Donnell Constr. Co. v. District of Columbia,
963 F.2d 420, 424 (D.C. Cir. 1992); Stuart, 951 F.2d at 450; Cone Corp.
v. Hillsborough County, 908 F.2d 908, 915 (11th Cir.), cert. denied,
498 U.S. 983 (1990).
---------------------------------------------------------------------------
Applying its ``strong basis in evidence'' test, the Court held that
the statistics on which Richmond based its MBE program were not
probative of discrimination in contracting by the city or local
contractors, but at best reflected evidence of general societal
discrimination. Richmond had relied on limited testimonial evidence of
discrimination, supplemented by statistical evidence regarding: (i) the
disparity between the number of prime contracts awarded by the city to
minorities during the years 1978-1983 (less than one percent) and the
city's minority population (fifty percent), and (ii) the extremely low
number of MBEs that were members of local contractors' trade
associations. The Court found that this evidence was insufficient. It
said that more probative evidence would have compared, on the one hand,
the number of qualified MBEs in the local labor market with, on the
other hand, the number of city contracts awarded to MBEs and the number
of MBEs in the local contractors' associations.
In Adarand, Justice O'Connor's opinion noted that ``racial
discrimination against minority groups in this country is an
unfortunate reality,'' and as an example, it pointed to the
``pervasive, systematic, and obstinate discriminatory conduct'' that
underpinned the court-ordered affirmative action measures that were
upheld in United States v. Paradise, 480 U.S. 149 (1987). Adarand, 515
U.S. at 237 (internal quotations omitted).\21\ Her opinion did not say,
however, that only overwhelming evidence of the sort at issue in
Paradise can justify affirmative action. Again, Croson indicates that
what is required is a ``strong basis in evidence'' to support the
government's conclusion that race-based remedial action is warranted,
and that such evidence need only approach a prima facie showing of
discrimination against minorities. 488 U.S. at 500. The factual
predicate in Paradise plainly exceeded a prima facie showing. Post-
Croson lower court decisions support the conclusion that the requisite
factual predicate for race-based remedial action does not have to rise
to the level of discrimination in Paradise.
---------------------------------------------------------------------------
\21\ The measures at issue in Paradise were intended to remedy
discrimination by the Alabama Department of Public Safety, which had
not hired a Black trooper at any rank for four decades, 480 U.S. at 168
(plurality opinion), and then when Blacks finally entered the
department, had consistently refused to promote Blacks to the upper
ranks. Id. at 169-71.
---------------------------------------------------------------------------
The Court in Croson left open the question whether a government may
introduce statistical evidence showing that the pool of qualified
minorities would have been larger ``but for'' the discrimination that
is to be remedied. Post-Croson lower court decisions have indicated
that such evidence can be probative of discrimination.\22\
---------------------------------------------------------------------------
\22\ See, e.g.. Contractors Ass'n, 6 F.3d at 1008; O'Donnell
Constr. Co. v. District of Columbia, 963 F.2d 420, 427 (D.C. Cir.
1992); cf. Associated Gen. Contractors v. Coalition for Econ. Equity,
950 F.2d 1401, 1415 (9th Cir. 1991) (government had evidence that an
``old boy network'' in the local construction industry had precluded
minority businesses from breaking into the mainstream of ``qualified''
public contractors), cert. denied, 503 U.S. 985 (1992).
---------------------------------------------------------------------------
Croson also did not discuss the weight to be given to anecdotal
evidence of discrimination that a government gathers through complaints
filed with it by minorities or through testimony in public hearings.
Richmond had relied on such evidence as additional support for its MBE
plan, but the Court discounted it. Post-Croson lower court cases,
however, have said that anecdotal evidence can buttress statistical
proof of discrimination.\23\
---------------------------------------------------------------------------
\23\ See, e.g., Contractors Ass'n, 6 F.3d at 1002-03 (while
anecdotal evidence of discrimination alone rarely will satisfy the
Croson requirements, it can place important gloss on statistical
evidence of discrimination); Coral Constr. Co., 941 F.2d at 919
(``[t]he combination of convincing anecdotal and statistical evidence
is potent;'' anecdotal evidence can bring ``cold numbers to life'');
Cone Corp. 908 F.2d at 916 (testimonial evidence adduced by county in
developing MBE program, combined with gross statistical disparities in
minority participation in public contracting, provided ``more than
enough evidence on the question of prior discrimination and need for
racial classification'').
---------------------------------------------------------------------------
In addition, Croson did not discuss which party has the ultimate
burden of persuasion as to the constitutionality of an affirmative
action program when it is challenged in court. Prior to Croson, the
Supreme Court had spelled out the following evidentiary rule: while the
entity defending a remedial affirmative action measure bears the
initial burden of production to show that the measures are supported by
``a strong basis in evidence,'' the ``ultimate burden'' of proof rests
upon those challenging the measure to demonstrate that it is
unconstitutional. Wygant, 476 U.S. at 277-78 (plurality opinion).\24\
Lower courts consistently have said that nothing in Croson disturbs
this evidentiary rule.\25\
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\24\ See also Wygant, 476 U.S. at 293 (O'Connor, J., concurring in
part and concurring in the judgment) (when the government ``introduces
its statistical proof as evidence of its remedial purpose, thereby
supplying the court with the means for determining that the
[government] had a firm basis for concluding that remedial action was
appropriate, it is incumbent upon the [challengers] to prove their
case; they continue to bear the ultimate burden of persuading the court
that the [government's] evidence did not support an inference of prior
discrimination and thus a remedial purpose, or that the plan instituted
on the basis of this evidence was not sufficiently `narrowly tailored'
'').
\25\ See, e.g., Concrete Works, 36 F.3d at 1521-22; Contractors
Ass'n, 6 F.3d at 1005; Cone Corp., 908 F.2d at 916.
---------------------------------------------------------------------------
Finally, and perhaps most significantly, Croson did not resolve
whether a government must have sufficient evidence of discrimination at
hand before it adopts a racial classification, or whether ``post-hoc''
evidence of discrimination may be used to justify the classification at
a later date--for example, when it is challenged in litigation. The
Court did say that governments must ``identify [past] discrimination
with some specificity before they may use race-conscious relief.'' 488
U.S. at 504. However, every court of appeals to consider the question
has allowed governments to use ``post-enactment'' evidence to justify
affirmative action--that is, evidence that the government did not
consider when adopting a race-based remedial measure, but that
nevertheless reflects evidence of discrimination providing support for
the determination that remedial action was warranted at the time of
adoption.\26\ Those courts have interpreted Croson as requiring that a
government have some evidence of discrimination prior to embarking on
remedial race-conscious action, but not that it marshal all such
evidence at that time.\27\
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\26\ See Concrete Works, 36 F.3d at 1521; Contractors Ass'n, 6 F.3d
at 1004), Coral Constr. Co., 941 F.2d at 920. As the Second Circuit put
it when permitting a state government to rely on post-enactment
evidence to defend a race-based contracting measure, ``[t]he law is
plain that the constitutional sufficiency of . . . proffered reasons
necessitating an affirmative action plan should be assessed on whatever
evidence is presented, whether prior to or subsequent to the program's
enactment.'' Harrison & Burrowes Bridge Constr. Inc. v. Cuomo, 981 F.2d
50, 60 (2d Cir. 1992).
\27\ See Concrete Works, 36 F.3d at 1521 (``Absent any preenactment
evidence of discrimination, a municipality would be unable to satisfy
Croson. However, we do not read Croson's evidentiary requirement as
foreclosing the consideration of post-enactment evidence.''); Coral
Constr. Co., 941 F.2d al 920 (requirement that municipality have ``some
evidence'' of discrimination before engaging in race-conscious action
``does not mean that a program will be automatically struck down if the
evidence before the municipality at the time of enactment does not
completely fulfill both prongs of the strict scrutiny test. Rather, the
factual predicate for the program should be evaluated based upon all
evidence presented to the district court, whether such evidence was
adduced before or after enactment of the [program].''). One court has
observed that the ``risk of insincerity associated with post-enactment
evidence . . . is minimized'' where the evidence ``consists essentially
of an evaluation and re-ordering of [the] pre-enactment evidence'' on
which a government expressly relied in formulating its program.
Contractors Ass'n, 6 F.3d at 1004. Application of the post-enactment
evidence rule in that case essentially gave the government a period of
transition in which to build an evidentiary foundation for an
affirmative action program that was adopted before Croson, and thus
without reference to the Croson requirements. In Coral Construction,
the Ninth Circuit permitted the government to introduce post-enactment
evidence to provide further factual support for a program that had been
adopted after Croson, with the Croson standards in mind. See Coral
Constr. Co., 941 F.2d at 914-15, 919-20.
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2. Nonremedial Objectives
Because Richmond defended its MBE program on remedial grounds, the
Court in Croson did not explicitly address if and when affirmative
action may be adopted for ``nonremedial'' objectives, such as promoting
racial diversity and inclusion. The same is true of the majority
opinion in Adarand, since the program at issue in that case also is
said to be remedial. In his Adarand dissent, Justice Stevens said that
the majority's silence on the question does not foreclose the use of
affirmative action to serve nonremedial ends. 515 U.S. at 258 (Stevens,
J., dissenting). Thus, in the wake of Croson and Adarand, there are
substantial questions as to whether and in what settings nonremedial
objectives can constitute a compelling interest.\28\
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\28\ Given the nation's history of discrimination, virtually all
affirmative action can be considered remedial in a broad sense. But as
Croson makes plain, that history, on its own, cannot properly form the
basis of a remedial affirmative action measure under strict scrutiny.
---------------------------------------------------------------------------
To date, there has never been a majority opinion for the Supreme
Court that addresses the question. The closest the Court has come in
that regard is Justice Powell's separate opinion in Regents of the
Univ. of Calif, v. Bakke, 438 U.S. 265 (1978), which said that a
university has a compelling interest in taking the race of applicants
into account in its admissions process in order to foster greater
diversity among the student body.\29\ According to Justice Powell, this
would bring a wider range of perspectives to the campus, and in turn,
would contribute to a more robust exchange of ideas--which Justice
Powell said was the central mission of higher education and in keeping
with the time-honored First Amendment value in academic freedom. See
id. at 311-14.\30\ Since Bakke, Justice Stevens has been the most
forceful advocate on the Court for nonremedial affirmative action
measures. He has consistently argued that affirmative action makes just
as much sense when it promotes an interest in creating a more inclusive
and diverse society for today and the future, as when it serves an
interest in remedying past wrongs. See Adarand, 515 U.S. at 257
(Stevens, J., dissenting); Croson, 488 U.S. at 511-12 & n. 1 (Stevens,
J., concurring); Johnson, 480 U.S. at 646-47 (Stevens, J., concurring);
Wygant, 476 U.S. at 313-15 (Stevens, J., dissenting). As a circuit
judge in a case involving an ostensibly remedial affirmative action
measure, Justice Ginsburg announced her agreement with Justice Stevens'
position ``that remedy for past wrong is not the exclusive basis upon
which racial classifications may be justified.'' O'Donnell Constr. Co.,
963 F.2d at 429 (Ginsburg, J., concurring) (citing Justice Stevens'
concurrence in Croson, 488 U.S. at 511).
---------------------------------------------------------------------------
\29\ Although Justice Powell wrote for himself in Bakke, his
opinion was the controlling one in the case.
\30\ Although it apparently has not been tested to any significant
degree in the courts. Justice Powell's thesis may carry over to the
selection of university faculty: the greater the racial and ethnic
diversity of the professors, the greater the array of perspectives to
which the students would be exposed.
---------------------------------------------------------------------------
In Metro Broadcasting, the majority relied on Bakke and Justice
Stevens' vision of affirmative action to uphold FCC affirmative action
programs in the licensing of broadcasters on nonremedial grounds; the
Court said that diversification of ownership of broadcast licenses was
a permissible objective of affirmative action because it serves the
larger goal of exposing the nation to a greater diversity of
perspectives over the nation's radio and television airwaves. 497 U.S.
at 567-68. The Court reached that conclusion under intermediate
scrutiny, however, and thus did not hold that the governmental interest
in seeking diversity in broadcasting is ``compelling.'' Adarand did not
overrule the result in Metro Broadcasting--a point not lost on Justice
Stevens. See Adarand, 515 U.S. at 258 (Stevens, J., dissenting) (``The
majority today overrules Metro Broad., only insofar as it'' is
inconsistent with the holding that Federal affirmative action measures
are subject to strict scrutiny. ``The proposition that fostering
diversity may provide a sufficient interest to justify [a racial or
ethnic classification] is not inconsistent with the Court's holding
today--indeed, the question is not remotely presented in this case . .
. .'').
On the other hand, portions of Justice O'Connor's opinion in Croson
and her dissenting opinion in Metro Broadcasting appear to cast doubt
on the validity of nonremedial affirmative action programs. In one
passage in her opinion in Croson, Justice O'Connor stated that
affirmative action must be ``strictly reserved for the remedial
setting.'' 488 U.S. at 493 (plurality opinion). Echoing that theme in
her dissenting opinion (joined by Chief Justice Rehnquist and Justices
Kennedy and Scalia) in Metro Broadcasting, Justice O'Connor urged the
adoption of strict scrutiny for Federal affirmative action measures,
and asserted that under that standard, only one interest has been
``recognized'' as compelling enough to justify racial classifications:
``remedying the effects of racial discrimination.'' 497 U.S. at 612.
Justice Kennedy's separate dissent in Metro Broadcasting was also quite
dismissive of non-remedial justifications for affirmative action; he
criticized the majority opinion for ``allow[ing] the use of racial
classifications by Congress untied to any goal of addressing the
effects of past race discrimination''). Id. at 632 (Kennedy, J.,
dissenting).
Nowhere in her Croson and Metro Broadcasting opinions did Justice
O'Connor expressly disavow Justice Powell's opinion in Bakke.
Accordingly, lower courts have assumed that Justice O'Connor did not
intend to discard Bakke.\31\ That proposition is supported by Justice
O'Connor's own concurring opinion in Wygant, in which she expressed
approval of Justice Powell's view that fostering racial and ethnic
diversity in higher education is a compelling interest. 476 U.S. at
286. Furthermore, in Wygant, Justice O'Connor said that there might be
governmental interests other than remedying discrimination and
promoting diversity in higher education that might be sufficiently
compelling to support affirmative action. Id. For example, Justice
O'Connor left open the possibility that promoting racial diversity
among the faculty at primary and secondary schools could count as a
compelling interest. Id. at 288 n*. In his Wygant dissent, Justice
Stevens argued that this is a permissible basis for affirmative action.
Id. at 313-15 (Stevens, J., dissenting).
---------------------------------------------------------------------------
\31\ See Winter Park Communications, Inc. v. FCC, 873 F.2d 347,
353-54 (D.C. Cir. 1989), aff'd sub. nom. Metro Broad., Inc. v. FCC, 497
U.S. 547 (1990); Winter Park, 873 F.2d at 357 (Williams, J., concurring
in part and dissenting in part); Shurberg Broad., Inc. v. FCC, 876 F.2d
902, 942 (D.C. Cir. 1989) (Wald, C.J., dissenting), aff'd sub. nom.
Metro Broad., Inc. v. FCC, 497 U.S. 547 (1990). In Davis v. Halpern,
768 F. Supp. 968 (S.D.N.Y. 1991), the court reviewed the law of
affirmative action in the wake of Croson and Metro Broadcasting, and,
citing Justice Powell's opinion in Bakke, said that a university has a
compelling interest in seeking to increase the diversity of its student
body. Id. at 981. See also United States v. Board of Educ. Township of
Piscataway, 832 F. Supp. 836, 847-48 (D.N.J. 1993) (under
constitutional standards for affirmative action, diversity in higher
education is a compelling governmental interest) (citing Bakke and
Croson).
---------------------------------------------------------------------------
On the assumption that Bakke remains the law, it is clear that to
the extent affirmative action is used to foster racial and ethnic
diversity, the government must seek some further objective, beyond the
mere achievement of diversity itself.\32\ As Bakke teaches, in higher
education, that asserted goal is the enrichment of the academic
experience. And according to the majority in Metro Broadcasting, the
asserted independent goal that justifies diversifying the owners of
broadcast licenses is adding variety to the perspectives that are
communicated in radio and television. That same kind of analysis must
be applied to efforts to promote racial and ethnic diversity in other
settings.
---------------------------------------------------------------------------
\32\ The Court has consistently rejected ``racial balancing'' as a
goal of affirmative action. See Croson, 488 U.S. at 507; Johnson, 480
U.S. at 639; Local 28 Sheet Metal Workers' Int'l Ass'n v. EEOC, 478
U.S. 421, 475 (1986) (plurality opinion); Bakke, 438 U.S. at 307
(opinion of Powell, J.).
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For instance, diversification of the ranks in a law enforcement
agency arguably serves vital public safety and operational needs, and
thus enhances the agency's ability to carry out its functions
effectively. See Wygant, 476 U.S. at 314 (Stevens, J., dissenting)
(``[I]n law enforcement . . . in a city with a recent history of racial
unrest, the superintendent of police might reasonably conclude that an
integrated police force could develop a better relationship with the
community and thereby do a more effective job of maintaining law and
order than a force composed only of whites.''); Paradise, 480 U.S. at
167 n. 18 (plurality opinion) (noting argument that race-conscious
hiring can ``restore[] community trust in the fairness of law
enforcement and facilitate[] effective police service by encouraging
citizen cooperation'').\33\ It is more difficult to identify any
independent goal that may be attained by diversifying the racial mix of
public contractors. Justice Stevens concurred in the judgment in Croson
on precisely that ground. Citing his own Wygant dissent, Justice
Stevens contrasted the ``educational benefits to the entire student
body'' that he said could be achieved through faculty diversity with
the minimal societal benefits (other than remedying past
discrimination, a predicate that he said was not supported by the
evidence in Croson) that would flow from a diversification of the
contractors with whom a municipality does business. See Croson, 488
U.S. at 512-13 (Stevens, J., concurring in part and concurring in the
judgment). Furthermore, the Court has stated that the desire to develop
a growing class of successful minority entrepreneurs to serve as ``role
models'' in the minority community is not, on its own, a valid basis
for a racial or ethnic classification. See Croson, 488 U.S. at 497
(citing Wygant, 476 U.S. at 276 (plurality opinion)); see also Wygant,
476 U.S. at 288 n* (O'Connor, J., concurring).
---------------------------------------------------------------------------
\33\ See also Detroit Police Officers' Ass'n v. Young, 608 F.2d
671, 696 (6th Cir. 1979), cert. denied, 452 U.S. 938 (1981) (``The
argument that police need more minority officers is not simply that
Blacks communicate better with Blacks or that a police department
should cater to the public's desires. Rather, it is that effective
crime prevention and solution depend heavily on the public support and
cooperation which result only from public respect and confidence in the
police.'').
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Diversification of the health services profession was one of the
stated predicates of the racial and ethnic classifications in the
medical school admissions program at issue in Bakke. The asserted
independent goal was ``improving the delivery of health-care services
to communities currently underserved.'' Bakke, 438 U.S. at 310. Justice
Powell said that ``[i]t may be assumed that in some situations a
State's interest in facilitating the health care of its citizens is
sufficiently compelling to support the use of a suspect
classification.'' Id. The problem in Bakke, however, was that there was
``virtually no evidence'' that the preference for minority applicants
was ``either needed or geared to promote that goal.'' Id.\34\
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\34\ Aside from (he proffered justification in Bakke, the
government may have other reasons for seeking to increase the number of
minority health professionals.
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Assuming that some nonremedial objectives remain a legitimate basis
for affirmative action after Adarand, there is a question of the nature
of the showing that may be necessary to support racial and ethnic
classifications that are premised on such objectives. In higher
education, the link between the diversity of the student body and the
diversity of viewpoints on the campus does not readily lend itself to
empirical proof. Justice Powell did not require any such evidence in
Bakke. He said that the strong First Amendment protection of academic
freedom that allows ``a university to make its own judgments as to
education includes the selection of its student body.'' Bakke, 438 U.S.
at 312. A university is thus due some discretion to conclude that a
student ``with a particular background--whether it be ethnic,
geographic, culturally advantaged or disadvantaged--may bring to a
professional school of medicine experiences, outlooks, and ideas that
enrich the training of its student body and better equip its graduates
to render with understanding their vital service to humanity.'' Id. at
314.
It could be said that this thesis is rooted in a racial stereotype,
one that presumes that members of racial and ethnic minority groups
have a ``minority perspective'' to convey. As Justice O'Connor stated
in Croson, a driving force behind strict scrutiny is to ensure that
racial and ethnic classifications are not motivated by ``stereotype.''
Croson, 488 U.S. at 493 (plurality opinion). There are sound arguments
to support the contention that seeking diversity in higher education
rests on valid assumptions. The thesis does not presume that all
individuals of a particular race or ethnic background think and act
alike. Rather, it is premised on what seems to be a common sense
proposition that in the aggregate, increasing the diversity of the
student body is bound to make a difference in the array of perspectives
communicated at a university. See Metro Broad., 497 U.S. at 579 (``The
predictive judgment about the overall result of minority entry into
broadcasting is not a rigid assumption about how minority owners will
behave in every case but rather is akin to Justice Powell's conclusion
in Bakke that greater admission of minorities would contribute, on
average, to the robust exchange of ideas.'') (internal quotations
omitted). Nonetheless, after Croson and Adarand, a court might demand
some proof of a nexus between the diversification of the student body
and the diversity of viewpoints expressed on the campus.\35\ Likewise,
a court may demand a factual predicate to support the proposition that
greater diversity in a law enforcement agency will serve the
operational needs of the agency and improve its performance,\36\ or
that minority health care professionals are more likely to work in
medically underserved communities.\37\
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\35\ Justice Powell cited literature on this subject in support of
his opinion in Bakke. See 438 U.S. at 312-13 n. 48, 315 n.50.
\36\ See Hayes v. North State Law Enforcement Officers Ass'n, 10
F.3d 207, 215 (4th Cir. 1993) (although the use of racial
classifications to foster diversity of police department could be a
constitutionally permissible objective, city failed to show a link
between effective law enforcement and greater diversity in the
department's ranks).
\37\ See Bakke, 438 U.S. at 311 (opinion of Powell, J.) (noting
lack of empirical data to support medical school's claim that minority
doctors will be more likely to practice in a disadvantaged community).
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B. Narrow Tailoring Test
In addition to advancing a compelling goal, any governmental use of
race must also be ``narrowly tailored.'' There appear to be two
underlying purposes of the narrow tailoring test: first, to ensure that
race-based affirmative action is the product of careful deliberation,
not hasty decisionmaking; and, second, to ensure that such action is
truly necessary, and that less intrusive, efficacious means to the end
are unavailable. As it has been applied by the courts, the factors that
typically make up the ``narrow tailoring'' test are as follows: (i)
whether the government considered race-neutral alternatives before
resorting to race-conscious action; (ii) the scope of the affirmative
action program, and whether there is a waiver mechanism that
facilitates the narrowing of the program's scope; (iii) the manner in
which is used, that is, whether race is a factor in determining
eligibility for a program or whether race is just one factor in the
decisionmaking process; (iv) the comparison of any numerical target to
the number of qualified minorities in the relevant sector or industry;
(v) the duration of the program and whether it is subject to periodic
review; and (vi) the degree and type of burden caused by the program.
In Adarand, the Supreme Court referred to its previous affirmative
action decisions for guidance on what the narrow tailoring test
entails. It specifically mentioned that when the Tenth Circuit reviewed
the DOT program at issue in Adarand under intermediate scrutiny, it had
not addressed race-neutral alternatives or the duration of the program.
Before describing each of the components, three general points
about the narrow tailoring test deserve mention. First, it is probably
not the case that an affirmative action measure has to satisfy every
factor. A strong showing with respect to most of the factors may
compensate for a weaker showing with respect to others.
Second, all of the factors are not relevant in every case. For
example, the objective of the program may determine the applicability
or weight to be given a factor. The factors may play out differently
where a program is nonremedial.
Third, the narrow tailoring test should not necessarily be viewed
in isolation from the compelling interest test. To be sure, the
inquiries are distinct: as indicated above, the compelling interest
inquiry focuses on the ends of an affirmative action measure, whereas
the narrow tailoring inquiry focuses on the means. However, as a
practical matter, there may be an interplay between the two. There is
some hint of this in Croson. In several places, the Court said that the
weak predicate of discrimination on which Richmond acted could not
justify the adoption of a rigid racial quota--which suggests that if
Richmond had opted for some more flexible measure the Court might have
been less demanding when reviewing the evidence of discrimination. By
the same token, the more compelling the interest, perhaps less narrow
tailoring is required. For example, in Sheet Metal Workers, and
Paradise, the Supreme Court upheld what on their face appear to be
rather rigid classifications to remedy egregious and persistent
discrimination.
However, it bears emphasizing that the Supreme Court has never
explicitly recognized any trade-off between the compelling interest and
narrow tailoring tests. It is also far from clear that the Court in
Croson would have found that a more flexible MBE program, supported by
the generalized evidence of discrimination on which Richmond relied,
could withstand strict scrutiny. In addition, the membership of the
Court has changed dramatically in the years since Sheet Metal Workers
and Paradise. Both cases were decided by 5-4 margins, and only one
member of the majority (Justice Stevens) remains. And while Justice
O'Connor agreed with the majority in Sheet Metal Workers and Paradise
that ample evidence of deeply entrenched discrimination gave rise to a
very weighty interest in race-based action, she dissented on the ground
that the particular remedies selected were too rigid.
1. Race-Neutral Alternatives
In Croson, the Supreme Court said that the Richmond MBE program was
not ``narrowly tailored,'' in part because the city apparently had not
considered race-neutral means to increase minority participation in
contracting before adopting its race-based measure. The Court reasoned
that because minority businesses tend to be smaller and less-
established, providing race-neutral financial and technical assistance
to small and/or new firms and relaxing bonding requirements might
achieve the desired remedial results in public contracting--increasing
opportunities for minority businesses. 488 U.S. at 507, 510. Justice
Scalia suggested an even more aggressive idea: ``adopt a preference for
small businesses, or even for new businesses--which would make it
easier for those previously excluded by discrimination to enter the
field. Such programs may well have a racially disproportionate impact,
but they are not based on race.'' Id. at 526 (Scalia, J., concurring).
As such, they would not be subjected to strict scrutiny.
The Court in Croson did not specify the extent to which governments
must consider race-neutral measures before resorting to race-conscious
action. It would seem that the government need not first exhaust race-
neutral alternatives, but only give them serious attention.\38\ This
principle would comport with the purposes of ensuring that race-based
remedies are used only when, after careful consideration, a government
has concluded that less intrusive means would not work. It also
comports with Justice Powell's view that in the remedial setting, the
government need not use the ``least restrictive means'' where they
would not accomplish the desired ends as well. See Fullilove, 448 U.S.
at 508 (Powell, J., concurring); see also Wygant, 476 U.S. at 280 n. 6
(plurality opinion of Justice Powell) (narrow tailoring requirement
ensures that ``less restrictive means'' are used when they would
promote the objectives of a racial classification ``about as well'')
(internal quotations omitted).\39\
---------------------------------------------------------------------------
\38\ See Coral Constr. Co., 941 F.2d at 923 (``[W]hile strict
scrutiny requires serious, good faith consideration of race-neutral
alternatives, strict scrutiny does not require exhaustion of every such
possible alternative.'').
\39\ Cf. Billish, 989 F.2d at 894 (7th Cir.) (en banc) (Posner, J.)
(in reviewing affirmative action measures, courts must be ``sensitiv[e]
to the importance of avoiding racial criteria . . . whenever it is
possible to do so, [as] Croson requires''), cert. denied, 510 U.S. 908
(1993).
---------------------------------------------------------------------------
This approach gives the government a measure of discretion in
determining whether its objectives could be accomplished through some
other avenue. In addition, under this approach, the government may not
be obliged to consider race-neutral alternatives every time that it
adopts a race-conscious measure in a particular field. In some
situations, the government may be permitted to draw upon a previous
consideration of race-neutral alternatives that it undertook prior to
adopting some earlier race-based measure.\40\ In the absence of prior
experience, however, a government should consider race-neutral
alternatives at the time it adopts a racial or ethnic classification.
More fundamentally, even where race-neutral alternatives were
considered, a court might second-guess the government if the court
believes that an effective race-neutral alternative is readily
available and hence should have been tried. See Metro Broadcasting, 497
U.S. at 625 (O'Connor, J., dissenting) (FCC affirmative action programs
are not narrowly tailored, in part, because ``the FCC has never
determined that it has any need to resort to racial classifications to
achieve its asserted interest, and it has employed race-conscious means
before adopting readily available race-neutral, alternative means'');
Paradise, 480 U.S. at 199-200 (O'Connor, J., dissenting) (district
court's race-based remedial order was not narrowly tailored because the
court ``had available several alternatives'' that would have achieved
the objectives in a less intrusive manner).\41\
---------------------------------------------------------------------------
\40\ See Contractors Ass'n, 6 F.3d at 1009 n. 18.
\41\ See also Seibels, 31 F.3d at 1571 (city should have
implemented race-neutral alternative of establishing nondiscriminatory
selection procedures in police and fire departments instead of adopting
race-based procedures; ``continued use of discriminatory tests . . .
compounded the very evil that [race-based measures] were designed to
eliminate''); Aiken v. City of Memphis, 37 F.3d 1155, 1164 (6th Cir.
1994) (remanding to lower court, in part, because evidence suggested
that the city should have used obvious set of race-neutral alternatives
before resorting to race-conscious measures).
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2. Scope of Program/Administrative Waivers
Justice O'Connor's opinion for the Court in Croson criticized the
scope of Richmond's thirty percent minority subcontracting requirement,
calling it a ``rigid numerical quota'' that did not permit
consideration, through some form of administrative waiver mechanism, of
whether particular individuals benefiting from the ordinance had
suffered from the effects of the discrimination that the city was
seeking to remedy. 488 U.S. at 508. At first blush, this criticism of
the Richmond plan may appear to conflict with previous Court decisions,
joined by Justice O'Connor, that held that race-based remedial measures
need not be limited to persons who were the victims of discrimination.
(See supra pp. 174-75.) Upon closer reading, however, Croson should not
be interpreted as introducing a ``victims-only'' requirement through
the narrow tailoring test.\42\ The Court's rejection in Adarand of
Justice Scalia's position that compensation is due only to individuals
who have been discriminated against personally provides further
confirmation that Croson did not impose any such requirement.
---------------------------------------------------------------------------
\42\ Most lower courts have not construed Croson in that fashion.
See, e.g., Billish, 962 F.2d at 1292-94, rev'd on other grounds, 989
F.2d 890 (7th Cir.) (en banc), cert. denied, 510 U.S. 908 (1993); Coral
Constr. Co., 941 F.2d at 925-26 n. 15; Cunico v. Pueblo Sch. Dist. No.
60, 917 F.2d 431, 437 (10th Cir. 1990). But see Winter Park
Communications. Inc., 873 F.2d at 367-68 (Williams, J., concurring in
part and dissenting in part) (interpreting Croson as requiring that
racial classifications be limited ``to victims of prior
discrimination''); Main Line Paving Co. v. Board of Educ., 725 F. Supp.
1349, 1362 (E.D. Pa. 1989) (MBE program not narrowly tailored, in part,
because it ``containe[d] no provision to identify those who were
victims of past discrimination and to limit the program's benefits to
them'').
---------------------------------------------------------------------------
The Court's focus in Croson on individualized consideration of
persons seeking the benefit of a racial classification appears to have
been animated by three separate concerns about the scope of the
Richmond plan. First, the Court indicated that in order for a remedial
affirmative action program to be narrowly tailored, its beneficiaries
must be members of groups that were the victims of discrimination. The
Court faulted the Richmond plan because it was intended to remedy
discrimination against African-American contractors, but included among
its beneficiaries Hispanics, Asian-Americans, Native-Americans,
Eskimos, and Aleuts--groups for which Richmond had proffered
``absolutely no evidence of past discrimination.'' Id. at 506.
Therefore, the Court said, even if the Richmond MBE program was ``
`narrowly tailored' to compensate African-American contractors for past
discrimination, one may legitimately ask why they are forced to share
this `remedial relief' with an Aleut citizen who moves to Richmond
tomorrow?'' Id.\43\ Second, the Court said that the Richmond plan was
not even narrowly tailored to remedy discrimination against Black
contractors because ``a successful Black entrepreneur . . . from
anywhere in the country'' could reap its benefits. Id. at 508. That is,
the geographic scope of the plan was not sufficiently tailored.\44\
Third, the Court contrasted the ``rigidity'' of the Richmond plan with
the flexible waiver mechanism in the ten percent minority participation
requirement that was upheld in Fullilove. As the Court in Croson
described it, the requirement in Fullilove could be waived where a
minority business charged a ``higher price [that] was not attributable
to the effects of past discrimination.'' Id. See Fullilove, 448 U.S. at
488 (plurality opinion). The theory is that where a business is
struggling to overcome discrimination, it may not have the capacity to
submit a competitive bid. That an effective waiver provision allows for
``individualized consideration'' of a particular minority contractor's
bid does not mean that the contractor has to be a ``victim'' of a
specific instance of discrimination. It does mean that if the
contractor is wealthy and has entered the mainstream of contractors in
the community, a high bid might not be traceable to the discrimination
that a racial or ethnic classification is seeking to redress. Instead,
such a bid might reflect an effort to exploit the classification.\45\
---------------------------------------------------------------------------
\43\ See O'Donnell Constr. Co., 963 F.2d at 427 (MBE program was
not narrowly tailored because of ``random inclusion of racial groups
for which there was no evidence of past discrimination'').
\44\ Compare Coalition for Econ. Equity, 950 F.2d at 1418 (MBE
program intended to remedy discrimination against minorities in county
construction industry was narrowly tailored, in part, because scope of
beneficiaries was limited to minorities within the county) with
Podberesky v. Kirwan, 38 F.3d 147, 159 (4th Cir.) (scholarship program
intended to remedy discrimination against African-Americans in Maryland
was not narrowly tailored, in part, because African-Americans from
outside Maryland were eligible for the program), cert. denied, 514 U.S.
1128 (1995).
\45\ See Milwaukee County Pavers Ass'n v. Fiedler, 922 F.2d 419,
425 (7th Cir.) (noting that administrative waiver mechanism enabled
state to exclude from scope of beneficiaries of affirmative action plan
in public contracting ``two wealthy Black football players'' who
apparently could compete effectively outside the plan), cert. denied,
500 U.S. 954 (1991); Concrete Gen. Inc. v. Washington Suburban Sanitary
Comm'n, 779 F. Supp. 370, 381 (D. Md. 1991) (MBE program not narrowly
tailored, in part, because it had ``no provision to `graduate' from the
program those contracting firms which have demonstrated the ability to
effectively compete with non-MBE's in a competitive bidding process'');
see also Shurberg Broad., Inc. v. FCC, 876 F.2d at 916 (opinion of
Silberman, J.) (``There must be some opportunity to exclude those
individuals for whom affirmative action is just another business
opportunity.'').
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3. Manner in Which Race is Used
The Court's attack on the ``rigidity'' of the Richmond ordinance
also implicates another common refrain in affirmative action
jurisprudence: the manner in which race is used is an integral part of
the narrow tailoring requirement. The clearest statement of the Court's
somewhat mixed messages in this area is that programs that make race or
ethnicity a requirement of eligibility for particular positions or
benefits are less likely to survive constitutional challenge than
programs that merely use race or ethnicity as one factor to be
considered under a program open to all races and ethnic groups.\46\
---------------------------------------------------------------------------
\46\ The factor that we labeled above as ``scope of beneficiaries/
administrative waivers'' is sometimes considered by courts under the
heading of ``flexibility,'' along with a consideration of the manner in
which race is used. For the sake of clarity we have divided them into
two separate components of the narrow tailoring test.
---------------------------------------------------------------------------
Two types of racial classifications are subject to criticism as
being too rigid. First and most obvious is an affirmative action
program in which a specific number of positions are set aside for
minorities. The prime example is the medical school admissions program
that the Court invalidated in Bakke. Justice Powell's pivotal opinion
in the case turned squarely on the fact that the program reserved
sixteen percent of the slots at the medical school for members of
racial and ethnic minority groups. Another example of this type of
classification is the program upheld in Fullilove. It provides that,
except where the Secretary of Commerce determines otherwise, at least
ten percent of the amount of Federal grants for certain public works
projects must be expended by grantees to purchase goods or services
from minority-owned businesses. 42 U.S.C. 6705(f)(2).
The second type of classification that is vulnerable to attack on
flexibility grounds is a program in which race or ethnicity is the sole
or primary factor in determining eligibility. One example is the FCC's
``distress sale'' program, which allows a broadcaster whose
qualifications have been called into question to transfer his or her
license prior to an FCC revocation hearing, provided the transferee is
a minority-owned business.\47\ Another example of affirmative action
programs in which race or ethnicity is a requirement of eligibility are
college scholarships that are reserved for minorities.\48\
---------------------------------------------------------------------------
\47\ The distress sale program was upheld under intermediate
scrutiny in Metro Broadcasting.
\48\ There is a plausible distinction between college scholarships
that are reserved for minorities and admissions quotas that reserve
places at a college for minorities. In Podberesky v. Kirwan, 38 F.3d
147 (4th Cir 1994). cert. denied, 514 U.S. 1128 (1995), the Fourth
Circuit held that a college scholarship program for African Americans
was unconstitutional under Croson. The Fourth Circuit's decision,
however, did not equate the scholarship program with the admissions
quota struck down in Bakke, and it did not turn on the fact that race
was a requirement of eligibility for the program.
---------------------------------------------------------------------------
Under both types of classifications, persons not within the
designated categories are rendered ineligible for certain benefits or
positions.\49\ Justice Powell's opinion in Bakke rested on the fact
that the admissions program at issue was a quota that saved places for
minorities solely on the basis of their race.\50\ As Justice Powell put
it, such a program
---------------------------------------------------------------------------
\49\ The statutes and regulations under which DOT has established
the contracting program at issue in Adarand are different. Racial and
ethnic classifications are used in the form of a presumption that
members of minority groups are ``socially disadvantaged.'' However,
that presumption is rebuttable, and members of nonminority groups are
eligible for the program ``on the basis of clear and convincing
evidence'' that they are socially disadvantaged. Adarand, 515 U.S. at
207. See id. at 259-61 (Stevens, J., dissenting) (arguing that the
relevant statutes and regulations in Adarand are better tailored than
the Fullilove legislation, because they ``do[] not make race the sole
criterion of eligibility for participation in the program.'' Members of
racial and ethnic are presumed to be disadvantaged, but the presumption
is rebuttable, and even if it does not get the presumption, ``a small
business may qualify [for the program] by showing that it is both
socially and economically disadvantaged'').
\50\ Bakke is the only Supreme Court affirmative action case that
ultimately turned on the ``quota'' issue. In Croson, the Court referred
disparagingly to the thirty percent minority subcontracting requirement
at issue in the case as a ``quota,'' but that was not in itself the
basis for the Court's decision.
tells applicants who are not Negro, Asian, or Chicano that
they are totally excluded from a specific percentage of the
seats in an entering class. No matter how strong their
qualifications, quantitative and extracurricular, including
their own potential for contribution to educational diversity,
they are never afforded the chance to compete with applicants
---------------------------------------------------------------------------
from the preferred groups for the special admissions seats.
438 U.S. at 319. Justice Powell contrasted admissions programs that
require decisions based ``solely'' on race and ethnicity, id. at 315,
with programs in which race or ethnic background is simply one factor
among many in the admissions decision. Justice Powell said that in the
latter type of program, ``race or ethnic background may be deemed a
`plus' in a particular applicant's file, yet it does not insulate the
individual from comparison with all other candidates for the available
seats.'' Id. at 317. In Justice Powell's view, such programs are
sufficiently flexible to meet the narrow tailoring requirement.
This line of reasoning also resonates in Johnson v. Transportation
Agency, 480 U.S. 616 (1987). There, the Supreme Court upheld an
affirmative action plan under which a state government agency
considered the gender of applicants \51\ as one factor in making
certain promotion decisions. The Court noted that the plan ``set[]
aside no positions for women,'' but simply established goals for female
representation that were not ``construed'' by the agency as ``quotas.''
Id. at 638. The Court further observed that the plan ``merely
authorize[d] that consideration be given to affirmative action concerns
when evaluating qualified applicants.'' Id. The Court stressed that in
the promotion decision in question, ``sex . . . was but one of numerous
factors [that were taken] into account.'' Id. The agency's plan ``thus
resemble[d]'' the type of admissions program ``approvingly noted by
Justice Powell'' in Bakke: it ``requires women to compete with all
other qualified applicants. No persons are automatically excluded from
consideration; all are able to have their qualifications weighed
against those of other applicants.'' Id. See also id. at 656-57
(O'Connor, J., concurring in judgment) (agency's promotion decision was
not made ``solely on the basis of sex;'' rather, ``sex was simply used
as a `plus factor' '').
---------------------------------------------------------------------------
\51\ Although Johnson was a Title VII gender classification case,
its reasoning as to the distinction between quotas and goals is
instructive with respect to the constitutional analysis of racial and
ethnic classifications.
---------------------------------------------------------------------------
Finally, Croson itself touches on the point. The Court said that in
the absence of a waiver mechanism that permitted individualized
consideration of persons seeking a share of city contracts pursuant to
the requirement that thirty percent of the dollar value of prime
contracts go to minority subcontractors, the Richmond plan was
``problematic from an equal protection standpoint because [it made] the
color of an applicant's skin the sole relevant consideration.'' 488
U.S. at 508.
4. Comparison of Numerical Target to Relevant Market
Where an affirmative action program is justified on remedial
grounds, the Court has looked at the size of any numerical goal and its
comparison to the relevant labor market or industry. This factor
involves choosing the appropriate measure of comparison. In Croson,
Richmond defended its thirty percent minority subcontracting
requirement on the premise that it was halfway between .067 percent--
the percentage of city contracts awarded to African-Americans during
the years 1978-1983--and fifty percent--the African-American population
of Richmond. The Court in Croson demanded a more meaningful statistical
comparison and much greater mathematical precision. It held that
numerical figures used in a racial preference must bear a relationship
to the pool of qualified minorities. Thus, in the Court's view, the
thirty percent minority subcontracting requirement was not narrowly
tailored, because it was tied to the African-American population of
Richmond, and as such, rested on the assumption that minorities will
choose a particular trade ``in lockstep proportion to their
representation in the local population.'' 488 U.S. at 507.\52\
---------------------------------------------------------------------------
\52\ Compare Aiken, 37 F.3d at 1165 (remanding to lower court, in
part, because race-based promotion goals in consent decree were tied to
``undifferentiated'' labor force statistics; instructing district court
on remand to determine whether racial composition of city labor force
``differs materially from that of the qualified labor pool for the
positions'' in question) with Edwards v. City of Houston, 37 F.3d 1097,
1114 (5th Cir. 1994) (race-based promotion goals in city police
department were narrowly tailored, in part, because the goals were tied
to the number of minorities with the skills for the positions in
question), reh'g granted, 49 F.3d 1048 (5th Cir. 1995).
---------------------------------------------------------------------------
5. Duration and Periodic Review
Under Croson, affirmative action represents a ``temporary''
deviation from ``the norm of equal treatment of all racial and ethnic
groups.'' Croson, 488 U.S. at 510. A particular measure therefore
should last only as long as it is needed. See Fullilove, 448 U.S. at
513 (Powell, J., concurring). Given this imperative, a racial or ethnic
classification is more likely to pass the narrow tailoring test if it
has a definite end-date,\53\ or is subject to meaningful periodic
review that enables the government to ascertain the continued need for
the measure. The Supreme Court has said that a set end-date is less
important where a program does not establish specific numerical targets
for minority participation. Johnson, 480 U.S. at 640. However, it
remains important for such a program to undergo periodic review. See
id. at 639-40.
---------------------------------------------------------------------------
\53\ See Paradise, 480 U.S. at 178 (plurality opinion) (race-based
promotion requirement was narrowly tailored, in part, because it was
``ephemeral,'' and would ``endured only until'' non-discriminatory
promotion procedures were implemented); Sheet Metal Workers, 478 U.S.
at 487 (Powell, J., concurring) (race-based hiring goal was narrowly
tailored, in part, because it ``was not imposed as a permanent
requirement, but [was] of limited duration''); Fullilove, 448 U.S. at
513 (Powell, J., concurring) (race-based classification in public works
legislation was narrowly tailored, in part, because it was ``not a
permanent part of Federal contracting requirements''); O'Donnell
Constr. Co., 963 F.2d at 428 (ordinance setting aside a percentage of
city contracts for minority businesses was not narrowly tailored, in
part, because it contained no ``sunset provision'' and no ``end [was]
in sight'').
---------------------------------------------------------------------------
Simply put, a racial or ethnic classification that was justified at
the point of its adoption may no longer be required at some future
point. If the classification is subject to reexamination from time to
time, the government can react to changed circumstances by fine-tuning
the classification, or discontinuing it if warranted. See Fullilove,
448 U.S. at 489 (plurality opinion); see also Metro Broadcasting, 497
U.S. at 594; Sheet Metal Workers, 478 U.S. at 478 (plurality opinion);
id. at 487-88 (Powell, J., concurring).
6. Burden
Affirmative action necessarily imposes a degree of burden on
persons who do not belong to the groups that are favored by a racial or
ethnic classification. The Supreme Court has said, however, that some
burdens are acceptable, even when visited upon individuals who are not
personally responsible for the particular problem that the
classification seeks to address. See Wygant, 476 U.S. at 280-81
(plurality opinion) (``As part of this Nation's dedication to
eradicating racial discrimination, innocent persons may be called upon
to bear some of the burden of the remedy.''). This was implicitly
reaffirmed in Croson and Adarand: in both cases, the Court
``recognize[d] that any individual suffers an injury when he or she is
disadvantaged by the government because of his or her race, whatever
that race may be,'' \54\ but declined to hold that the imposition of
that burden pursuant to an affirmative action measure is automatically
unconstitutional.
---------------------------------------------------------------------------
\54\ Adarand, 515 U.S. at 230 (citing Croson).
---------------------------------------------------------------------------
In some situations, however, the burden imposed by an affirmative
action program may be too high. As a general principle, a racial or
ethnic classification crosses that threshold when it ``unsettle[s] . .
. legitimate, firmly rooted expectation[s],'' \55\ or imposes the
``entire burden . . . on particular individuals.'' \56\ Applying that
principle in an employment case where seniority differences between
minority and nonminority employees were involved, a plurality of the
Court in Wygant stated that race-based layoffs may impose a more
substantial burden than race-based hiring and promotion goals, because
``denial of a future employment opportunity is not as intrusive as loss
of an existing job.'' Wygant, 476 U.S. at 282-83; see also id. at 294
(White, J., concurring). In a subsequent case, however, Justice Powell
warned that ``it is too simplistic to conclude that hiring [or other
employment] goals withstand constitutional muster whereas layoffs do
not . . . . The proper constitutional inquiry focuses on the effect, if
any, and the diffuseness of the burden imposed on innocent
nonminorities, not on the label applied to the particular employment
plan at issue.'' Sheet Metal Workers, 478 U.S. at 488 n. 3 (Powell, J.,
concurring).
---------------------------------------------------------------------------
\55\ Johnson, 480 U.S. at 638.
\56\ Sheet Metal Workers, 478 U.S. at 488 (Powell, J., concurring).
---------------------------------------------------------------------------
In the contracting area, a racial or ethnic classification would
upset settled expectations if it impaired an existing contract that had
been awarded to a person who is not included in the classification.
This apparently occurs rarely, if at all, in the Federal Government. A
more salient inquiry therefore focuses on the scale of the exclusionary
effect of a contracting program. For example, in Fullilove, Justice
Powell thought it salient that the contracting requirement at issue in
the case reserved for minorities a very small amount of total funds for
construction work in the nation (less than one percent), leaving
nonminorities able to compete for the vast remainder. For Justice
Powell, this rendered the effect of the program ``limited and so widely
dispersed that its use is consistent with fundamental fairness.''
Fullilove, 448 U.S. at 515. In some instances, conversely, the
exclusionary effect of racial classifications in contracting may be
considered too large. For example, the lower court in Croson held that
Richmond's thirty percent minority subcontracting requirement imposed
an impermissible burden because it placed nonminorities at a great
``competitive disadvantage.'' J.A. Croson Co. v. City of Richmond, 822
F.2d 1355, 1361 (4th Cir. 1987). Similarly, an affirmative action
program that effectively shut nonminority firms out of certain markets
or particular industries might establish an impermissible burden. For
example, the dissenters in Metro Broadcasting felt that the FCC's
distress sale unduly burdened nonminorities because it ``created a
specialized market reserved exclusively for minority controlled
applicants. There is no more rigid quota than a 100% setaside . . . .
For the would-be purchaser or person who seeks to compete for the
station, that opportunity depends entirely upon race or ethnicity.''
497 U.S. at 630 (O'Connor, J., dissenting). The dissenters also
dismissed the majority's contention that the impact of distress sales
on nonminorities was minuscule, given the small number of stations
transferred through those means. The dissenters said that ``[i]t is no
response to a person denied admission at one school, or discharged from
one job, solely on the basis of race, that other schools or employers
do not discriminate.'' Id.
C. The Post-Croson Landscape at the State and Local Level
Croson has not resulted in the end of affirmative action at the
state and local level. There is no doubt, however, that Croson, in
tightening the constitutional parameters, has diminished the incidence
of such programs, at least in contracting and procurement. The post-
Croson experience of governments that continue to operate affirmative
action programs in that area is instructive.\57\ Many governments
reevaluated their MBE programs in light of Croson, and modified them to
comport with the applicable standards. Typically, the centerpiece of a
government's efforts has been a ``disparity study,'' conducted by
outside experts, to analyze patterns and practices in the local
construction industry. The purpose of a disparity study is to determine
whether there is evidence of discrimination against minorities in the
local construction industry that would justify the use of remedial
racial and ethnic classifications in contracting and procurement. Some
studies also address the efficacy of race-neutral alternatives. In
addition to obtaining a disparity study, some governments have held
public hearings in which they have received evidence about the workings
of the local construction industry.
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\57\ A comprehensive review of voluntary affirmative action in
public employment at the state and local level after Croson is beyond
the scope of this memorandum. We note that a number of the programs
have involved remedial racial and ethnic classifications in connection
with hiring and promotion decisions in police and fire departments.
Some of the programs have been upheld, and others struck down. Compare
Peightal, (upholding race-based hiring goal in county fire department
under Croson) with Long v. City of Saginaw, 911 F.2d 1192 (6th Cir.
1990) (striking down race-based hiring goal in city police department
under Croson and Wygant).
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Post-Croson affirmative action programs in contracting and
procurement tend to employ flexible numerical goals and/or bidding
preferences in which race or ethnicity is a ``plus'' factor in the
allocation decision, rather than a hard setaside of the sort at issue
in Croson. It appears that many of the post-Croson contracting and
procurement programs that rest on disparity studies have not been
challenged in court.\58\ At least one of the programs was sustained in
litigation.\59\ Another was struck down as inconsistent with the Croson
standards.\60\ Challenges to other programs were not resolved on
summary judgment, and were remanded for further fact finding.\61\
Contracting and procurement programs that were not changed after Croson
have met with a mixed reception in the courts.\62\
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\58\ That has been true in Richmond. It is our understanding that
the city conducted a post-Croson disparity study and enacted a new MBE
program that establishes a bidding preference of ``20 points'' for
prime contractors who pledge to meet a goal of subcontracting sixteen
percent of the dollar value of a city contract to MBEs. The program
works at the ``prequalification'' stage, when the city is determining
its pool of eligible bidders on a project. Once the pool is selected,
the low bidder is awarded the contract.
\59\ See Associated Gen. Contractors v. Coalition for Econ. Equity,
950 F.2d 1401 (9th Cir. 1991), cert. denied, 503 U.S. 985 (1992).
\60\ Associated Gen. Contractors v. City of New Haven, 791 F. Supp.
941 (D. Conn. 1992), vacated on mootness grounds, 41 F.3d 62 (2d Cir.
1994).
\61\ Coral Constr. Co. v. King County, 941 F.2d 910 (9th Cir.
1991), cert. denied, 502 U.S. 1033 (1992); Concrete Works v. City and
County of Denver, 36 F.3d 1513 (10th Cir. 1994), cert. denied, 514 U.S.
1004 (1995). The courts in these two cases commented favorably on
aspects of the programs at issue and the disparity studies by which
they are justified.
\62\ We are aware of at least one such program that survived a
motion for summary judgment and apparently is still in effect today.
See Cone Corp. v. Hillsborough County, 908 F.2d 908 (11th Cir.), cert.
denied, 498 U.S. 983 (1990). Others have been invalidated. See, e.g.,
O'Donnell Constr. Co. v. District of Columbia, 963 F.2d 420 (D.C. Cir.
1992); Contractors' Assoc. v. City of Philadelphia, 893 F. Supp. 419
(E.D. Pa. 1995); Arrow Office Supply Co. v. City of Detroit, 826 F.
Supp. 1072 (E.D. Mich. 1993); F. Buddie Constr. Co. v. City of Elyria,
773 F. Supp. 1018 (N.D. Ohio 1991); Main Line Paving Co. v. Board of
Educ., 725 F. Supp. 1349 (E.D. Pa. 1989).
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III. Application of the Croson Standards at the Federal Level
In essence, Adarand federalizes Croson, with one important caveat:
Congress may be entitled to some deference when it acts on the basis of
race or ethnicity to remedy the effects of discrimination. The Court in
Adarand hinted that at least where a Federal affirmative action program
is congressionally mandated, the Croson standards might apply somewhat
more loosely. The Court concluded that it need not resolve whether and
to what extent the judiciary should pay special deference to Congress
in this area. The Court did, however, cite the opinions of various
Justices in Fullilove, Croson, and Metro Broadcasting concerning the
significance of Congress' express constitutional power to enforce the
anti-discrimination guarantees of the Thirteenth and Fourteenth
Amendments--under Section 2 of the former and Section 5 of the latter--
and the extent to which courts should defer to exercises of that
authority that entail the use of racial and ethnic classifications to
remedy discrimination. See 515 U.S. at 230-31. Some of those opinions
indicate that even under strict scrutiny, Congress does not have to
make findings of discrimination with the same degree of precision as a
state or local government, and that Congress may be entitled to some
latitude with respect to its selection of the means to the end of
remedying discrimination.\63\
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\63\ Section 1 of the Fourteenth Amendment prohibits states and
municipalities from denying persons the equal protection of the laws.
Section 5 gives Congress the power to enforce that prohibition. Because
Section 1 of the Fourteenth Amendment only applies to states and
municipalities, see United States v. Guest, 383 U.S. 745, 755 (1966),
it is uncertain whether Congress may act under Section 5 of that
amendment to remedy discrimination by purely private actors. See
Adarand, 515 U.S. at 254 n. 10 (Stevens, J., dissenting) (``Because
Congress has acted with respect to the States in enacting STURAA, we
need not revisit today the difficult question of 5's applicability to
pure regulation of private individuals.''); Metro Broad., 497 U.S. at
605 (O'Connor, J., dissenting) (``Section 5 empowers Congress to act
respecting the States, and of course this case concerns only the
administration of Federal programs by Federal officials.'').
Nevertheless, remedial legislation adopted under Section 5 of the
Fourteenth Amendment does not necessarily have to act on the states
directly. Indeed, when Congress seeks to remedy discrimination by
private parties, it may be indirectly remedying discrimination of the
states; for in some cases, private discrimination was tolerated or
expressly sanctioned by the states. Private discrimination, moreover,
often can be remedied under the enforcement provisions of the
Thirteenth Amendment. Section 1 of that amendment prohibits slavery and
involuntary servitude. Section 2 gives Congress the power to enforce
that prohibition by passing remedial legislation designed to eliminate
``the badges and incidents of slavery in the United States.'' Jones v.
Alfred Mayer Co., 392 U.S. 409, 439 (1968). The Supreme Court has held
that such legislation may be directed at remedying the discrimination
of private actors, as well as that of the states. Id. at 438. See also
Runyon v. McCrary, 427 U.S. 160, 179 (1976). In Fullilove, the
plurality opinion concluded that the Commerce Clause provided an
additional source of power under which Congress could adopt race-based
legislation intended to remedy the discriminatory conduct of private
actors. See Fullilove, 448 U.S. at 475 (plurality opinion).
---------------------------------------------------------------------------
In Fullilove, Justice Powell's concurring opinion said that, even
under strict scrutiny, ``[t]he degree of specificity required in the
findings of discrimination and the breadth of discretion in the choice
of remedies may vary with the nature and authority of a governmental
body.'' Fullilove, 448 U.S. at 515 n. 14 (Powell, J., concurring). It
was therefore of paramount importance to Justice Powell that the racial
and ethnic classification in Fullilove was prescribed by Congress,
which, Justice Powell admonished, ``properly may--and indeed must--
address directly the problems of discrimination in our society.'' Id.
at 499. Justice Powell emphasized that Congress has ``the unique
constitutional power'' to take such action under the enforcement
clauses of the Thirteenth and Fourteenth Amendments. Id. at 500. See
id. at 483 (plurality opinion) (``[I]n no organ of government, state or
Federal, does there repose a more comprehensive remedial power than in
the Congress, expressly charged by the Constitution with the competence
and authority to enforce equal protection guarantees.''). Justice
Powell observed that when Congress uses those powers, it can paint with
a broad brush, and can devise national remedies for the national
problem of racial and ethnic discrimination. Id. at 502-03 (Powell, J.,
concurring). Furthermore, Justice Powell said that through repeated
investigation of that problem, Congress has developed familiarity with
the nature and effects of discrimination: ``After Congress has
legislated repeatedly in an area of national concern, its Members gain
experience that may reduce the need for fresh hearings or prolonged
debate when Congress again considers action in that area.'' Id. at 503.
Because Congress need not redocument the fact and history of
discrimination each time it contemplates adopting a new remedial
measure, the findings that supported the Fullilove legislation were not
restricted to the actual findings that Congress made when it enacted
that measure. Rather, the record included ``the information and
expertise that Congress acquires in the consideration and enactment of
earlier legislation.'' Id. A court reviewing a race-based remedial act
of Congress therefore ``properly may examine the total contemporary
record of congressional action dealing with the problems of racial
discrimination against [minorities].'' Id. Finally, Justice Powell gave
similar deference to Congress when it came to applying the narrow
tailoring test. He said that in deciding how best to combat
discrimination in the country, the ``Enforcement Clauses of the
Thirteenth and Fourteenth Amendments give Congress a . . . measure of
discretion to choose a suitable remedy.'' Id. at 508.
Justice O'Connor's opinion in Croson is very much in the same vein.
She too commented that Congress possesses ``unique remedial powers . .
. under 5 of the Fourteenth Amendment.'' Croson, 488 U.S. at 488
(plurality opinion) (citing Fullilove, 448 U.S. at 483 (plurality
opinion)). By contrast, state and local governments have ``no specific
constitutional mandate to enforce the dictates of the Fourteenth
Amendment,'' but rather are subject to its ``explicit constraints.''
Id. at 490 (plurality opinion). Therefore, in Justice O'Connor's view,
state and local governments ``must identify discrimination, public or
private, with some specificity before they may use race-conscious
relief.'' Id. at 504. Congress, on the other hand, can make, and ``has
made national findings that there has been societal discrimination in a
host of fields.'' Id. It may therefore ``identify and redress the
effects of society-wide discrimination'' through the use of racial and
ethnic classifications that would be impermissible if adopted by a
state or local government. Id. at 490 (plurality opinion).\64\ Justice
O'Connor cited her Croson opinion and reiterated these general points
about the powers of Congress in her Metro Broadcasting dissent. See 497
U.S. at 605 (O'Connor, J., dissenting) (``Congress has considerable
latitude, presenting special concerns for judicial review, when it
exercises its unique remedial powers . . . under 5 of the Fourteenth
Amendment.'') (internal quotations omitted).
---------------------------------------------------------------------------
\64\ Justices Kennedy and Scalia declined to join that part of
Justice O'Connor's opinion in Croson that drew a distinction between
the respective powers of Congress and state or local governments in the
area of affirmative action.
---------------------------------------------------------------------------
It would be imprudent, however, to read too much into Justice
Powell's opinion in Fullilove and Justice O'Connor's opinion in Croson.
They do not, for example, support the proposition that Congress may
simply assert that because there has been general societal
discrimination in this country, legislative classifications based on
race or ethnicity are a necessary remedy. The more probable
construction of those opinions is that Congress must have some
particularized evidence about the existence and effects of
discrimination in the sectors and industries for which it prescribes
racial or ethnic classifications. For example, Congress established the
Fullilove racial and ethnic classification to remedy what the Court saw
as the well-documented effects of discrimination in one industry--
construction--that had hindered the ability of minorities to gain
access to public contracting opportunities. See Fullilove, 448 U.S. at
505-06 (Powell, J., concurring); see also id. at 473 (plurality
opinion).
Based on this reading of Croson and Fullilove, the endorsement in
Adarand of strict scrutiny of Federal affirmative action programs does
not mean that Congress must find discrimination in every jurisdiction
or industry affected by such a measure (although it is unclear whether,
as a matter of narrow tailoring, the scope of a classification should
be narrowed to exclude regions and trades that have not been affected
by the discrimination that is to be remedied). State and local
governments must identify discrimination with some precision within
their jurisdictions; Congress's jurisdiction is the nation as a whole.
But after Adarand, Congress is subject to the Croson ``strong basis in
evidence'' standard. Under that standard, the general history of racial
discrimination in the nation would not be a sufficient predicate for a
remedial racial or ethnic classification. In addition, evidence of
discrimination in one sector or industry is not always probative of
discrimination in other sectors and industries. For example, a history
of lending discrimination against minorities arguably cannot serve as a
catch-all justification for racial and ethnic classifications
benefitting minority-owned firms through the entire economy;
application of the narrow tailoring test would suggest that if lending
discrimination is the problem being addressed, then the government
should tackle it directly.\65\
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\65\ Patterns and practices of bank lending to minorities, may,
however, reflect a significant ``secondary effect'' of discrimination
in particular sectors and industries, i.e., because of that
discrimination, minorities cannot accumulate the necessary capital and
achieve the community standing necessary to qualify for loans.
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Furthermore, under the new standard, Congress probably does not
have to hold a hearing or draft a report each time it adopts a remedial
racial or ethnic classification. But where such a classification rests
on a previous law or series of laws, those earlier measures must be
supported by sufficient evidence of the effects of discrimination. And
if the findings in the older laws are stale, Congress or the pertinent
agency may have to demonstrate the continued relevance of those
findings; this would satisfy the element of the narrow tailoring test
that looks to the duration of classifications and whether they are
subject to reevaluation. Where the record is sparse, Congress or the
relevant agency may have to develop it. That endeavor may involve the
commissioning of disparity studies of the type that state and local
governments around the country undertook after Croson to demonstrate
that remedial racial and ethnic classifications in public contracting
are warranted. Together, the myriad state and local studies may provide
an important source of evidence supporting the use by the Federal
Government of national remedial measures in certain sectors of the
economy.
Whatever deference a court might accord to Federal remedial
legislation after Adarand, it is undecided whether the same degree of
deference would be accorded to nonremedial legislation. In Metro
Broadcasting, the majority gave substantial deference to congressional
judgments regarding the need for diversity in broadcasting and the
linkage between the race of a broadcaster and programming output. Metro
Broad., 497 U.S. at 566, 572-73, 591 n. 43. The dissenters did not do
so, precisely because the classifications were nonremedial and hence,
in their view, did not implicate Congress' powers under the Enforcement
Clauses of the Thirteenth and Fourteenth Amendments. Id. at 605, 628-29
(O'Connor, J., dissenting).
Finally, many existing Federal affirmative action programs are not
specifically mandated by Congress. Courts are unlikely to accord
Federal agencies acting without a congressional mandate the same degree
of deference accorded judgments made by Congress itself. Agencies do
not have the ``institutional competence'' and explicit ``constitutional
authority'' that Congress possesses. Adarand, 515 U.S. at 253 (Stevens,
J., dissenting).\66\ Although some existing agency programs were not
expressly mandated in the first instance in legislation, they may
nonetheless be viewed by a court as having been mandated by Congress
through subsequent congressional action. For example, in Metro
Broadcasting, the programs at issue were established by the FCC on its
own; Congress's role was limited to FCC oversight hearings and the
passage of an appropriations rider that precluded the FCC from using
any funds to reconsider or cancel its programs. 497 U.S. at 572-79. The
majority concluded that this record converted the FCC programs into
measures that had been ``specifically approved--indeed, mandated by
Congress.'' Id. at 563.
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\66\ See Milwaukee County Pavers Ass'n, 710 F. Supp. at 1540 n. 3
(noting that for purposes of judicial review of affirmative action
measures, there is a distinction between congressionally mandated
measures and those that are ``independently established'' by a Federal
agency), aff'd, 922 F.2d 419 (7th Cir.), cert. denied, 500 U.S. 954
(1991); cf. Bakke, 438 U.S. at 309 (opinion of Powell, J.) (public
universities, like many ``isolated segments of our vast governmental
structure are not competent to make [findings of national
discrimination], at least in the absence of legislative mandates and
legislatively determined criteria'').
---------------------------------------------------------------------------
Under strict scrutiny, it is uncertain what level of congressional
involvement is necessary before a court will review an agency's program
with deference. What may be required is evidence that Congress plainly
has brought its own judgment to bear on the matter. Cf. Adarand, 515
U.S. at 252 (Stevens, J., dissenting) (``An additional reason for
giving greater deference to the National Legislature than to a local
law-making body is that Federal affirmative-action programs represent
the will of our entire Nation's elected representatives . . . .'')
(emphasis added); id. at 255 (Stevens, J., dissenting) (``Congressional
deliberations about a matter as important as affirmative action should
be accorded far greater deference than those of a State or
municipality.'') (emphasis added).
IV. Conclusion
Adarand makes it necessary to evaluate Federal programs that use
race or ethnicity as a basis for decisionmaking to determine if they
comport with the strict scrutiny standard. No affirmative action
program should be suspended prior to such an evaluation. The
information gathered by many agencies in connection with the
President's recent review of Federal affirmative action programs should
prove helpful in this regard. In addition, appended to this memo is a
nonexhaustive checklist of questions that provides initial guidance as
to what should be considered in that review process. Because the
questions are just a guide, no single answer or combination of answers
is necessarily dispositive as to the validity of any given program.
Walter Dellinger,
Assistant Attorney General,
Office of Legal Counsel.
Appendix: Questions to Guide Review of Affirmative Action Programs
I. Authority
Is the use of racial or ethnic criteria as a basis for
decisionmaking mandated by legislation? If not mandated, is it
expressly authorized by legislation? If there is no express
authorization, has there been any indication of congressional approval
of an agency's action in the form of appropriations riders or oversight
hearings? These questions are important, because Congress may be
entitled to some measure of deference when it decides that racial and
ethnic classifications are necessary.
If there is no explicit legislative mandate, authorization, or
approval, is the program premised on an agency rule or regulation that
implements a statute that, on its face, is race-neutral? For example,
some statutes require agencies to give preferences to ``disadvantaged''
individuals, but do not establish a presumption that members of racial
groups are disadvantaged. Such a statute is race-neutral. Other
statutes, like those at issue in Adarand, require agencies to give
preferences to ``disadvantaged'' individuals, but establish a
rebuttable presumption that members of racial groups are disadvantaged.
Such a statute is race-conscious, because it authorizes agencies to use
racial criteria in decisionmaking.
II. Purpose
What is the objective of the program? Is it intended to remedy
discrimination, to foster racial diversity in a particular sector or
industry, or to achieve some other purpose? Is it possible to discern
the purpose from the face, the relevant statute or legislation? If not,
does the record underlying the relevant legislation or regulation shed
any light on the purpose of the program?
A. Factual Predicate: Remedial Programs
If the program is intended to serve remedial objectives, what is
the underlying factual predicate of discrimination? Is the program
justified solely by reference to general societal discrimination,
general assertions of discrimination in a particular sector or
industry, or a statistical underrepresentation of minorities in a
sector or industry? Without more, these are impermissible bases for
affirmative action. If the discrimination to be remedied is more
particularized, then the program may satisfy Adarand. In assessing the
nature of the factual predicate of discrimination, the following
factors should be taken into account:
1. Source. Where can the evidence be found? Is it contained in find
set forth in a relevant statute or legislative history
(committee reports and hearings)? Is evidence contained in
findings that an agency has made on its own in connection
with a rulemaking process or in the promulgation of
guidelines? Do the findings expressly or implicitly rest on
findings made in connection with a previous, related
program (or series of programs)?
2. Type. What is the nature of the evidence? Is it statistical or
documentary? Are the statistics based on minority
underrepresentation in a particular sector or industry
compared to the general minority population? Or are the
statistics more sophisticated and focused? For example, do
they attempt to identify the number of qualified minorities
in the sector or industry or seek to explain what that
number would look like ``but for'' the exclusionary effects
of discrimination? Does the evidence seek to explain the
secondary effects of discrimination--for example, how the
inability of minorities to break into certain industries
due to historic practices of exclusion has hindered their
ability to acquire the requisite capital and financing?
Similarly, where health and education programs are at
issue, is there evidence on how discrimination has hampered
minority opportunity in those fields, or is the evidence
simply based on generalized claims of societal
discrimination? In addition to any statistical and
documentary evidence, is there testimonial or anecdotal
evidence of discrimination in the record underlying the
program--for example, accounts of the experiences of
minorities and nonminorities in a particular field or
industry?
3. Scope. Are the findings purported to be national in character and
dimension? Or do they reflect evidence of discrimination in
certain regions or geographical areas?
4. ``Authorship''. If Congress or an agency relied on reports and
testimony of others in making findings, who is the
``author'' of that information? The Census Bureau? The
General Accounting Office? Business and trade associations?
Academic experts? Economists? (There is no necessary
hierarchy in assessing authorship, but the identity of the
author may affect the credibility of the findings.)
5. Timing. Since the adoption of the program, have additional
findings of discrimination been assembled by Congress or
the agency that could serve to justify the need for the
program when it was adopted? If not, can such evidence be
readily assembled now? These questions go to whether
``post-enactment'' evidence can be marshaled to support the
conclusion that remedial action was warranted when the
program was first adopted.
B. Factual Predicate: Nonremedial Programs
Adarand does not directly address whether and to what extent
nonremedial objectives for affirmative action may constitute a
compelling governmental interest. At a minimum, to the extent that an
agency administers a nonremedial program intended to promote diversity,
the factual predicate must show that greater diversity would foster
some larger societal goal beyond diversity for diversity's sake. The
level and precision of empirical evidence supporting that nexus may
vary, depending on the nature and purpose of a nonremedial program. For
a nonremedial program, the source, type, scope, authorship, and timing
of underlying findings should be assessed, just as for remedial
programs.
III. Narrow Tailoring
A. Race-Neutral Alternatives
Did Congress or the agency consider race-neutral means to achieve
the ends of the program at the time it was adopted? Race-neutral
alternatives might include preferences based on wealth, income,
education, family, geography. In the commercial setting, another such
alternative is a preference for new, emerging businesses. Were any of
these alternatives actually tried and exhausted? What was the nature
and extent of the deliberation over any race-neutral alternatives--for
example, congressional debate? agency rulemaking? Was there a judgment
that race-neutral alternatives would not be as efficacious as race-
conscious measures? Did Congress or the agency rely on previous
consideration and rejection of race-neutral alternatives in connection
with a prior, related race-conscious measure (orseries of measures)?
B. Continued Need
How long has the program been in existence? Even if there was a
compelling justification at the time of adoption, that may not be the
case today. Thus, an agency must determine whether there is a continued
need for the program. In that regard, does the program have an end
date? Has the end date been moved back? Is the program subject to
periodic oversight? What is the nature of that oversight--does Congress
play a role through hearings/reports, or does the agency conduct the
review or oversight on its own? Has the program ever been adjusted or
modified in light of a periodic review? What were the results of the
most recent review and oversight conducted by either Congress or the
agency? Is there evidence of what might result if the racial
classification were discontinued? For example, is there evidence of the
current level of minority participation in government contracting where
racial criteria are not used (which may speak to whether discrimination
can be remedied without a preference)?
C. Pool of Beneficiaries
Are the benefits of the program spread relatively equally among
minority individuals or businesses? Is there information on whether the
same individuals or businesses tend to reap most of the benefits, and
if so, whether those beneficiaries have overcome discrimination? If the
program is intended to remedy discrimination against minorities, does
it include among its beneficiaries subgroups that may not have been
discriminated against? Is there a procedure for tailoring the pool of
beneficiaries to exclude such subgroups? Is there a mechanism for
evaluating whether the program is needed for segments within a larger
industry that have been the locus of discrimination?
D. Manner in Which Race is Used
Does the program establish fixed numerical set-asides? Is race an
explicit requirement of eligibility for the program? If there is no
such facial requirement, does the program operate that way in practice?
Or is race just one of several factors--a ``plus''--used in
decisionmaking? Could the objectives of a program that uses race as a
requirement for eligibility be achieved through a more flexible use of
race?
E. Burden
What is the nature of the burden imposed on persons who are not
included in the racial or ethnic classification that the program
establishes? Does the program displace those persons from existing
positions/contracts? Does it upset any settled expectations that they
have? Even if that is not the case, the burden may be impermissible
where the exclusionary impact is too great. What is the exclusionary
impact in terms of size and dimension? What is the dollar value of the
contracts/grants/positions in question? Does the exclusionary impact of
the program fall upon a particular group or class of individuals or
sectors, or is it more diffuse? What is the extent of other
opportunities outside the program? Are persons who are not eligible for
the preference put at a significant competitive disadvantage as a
result of the program?
______
Submitted Book by Hon. Bobby L. Rush, a Representative in Congress from
Illinois *
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* Editor's note: the book, in its entirety, is retained in
Committee file. It can be accessed online at: https://
digitalcommons.law.uga.edu/books/138/.
* * * * *
Historian Manning Marable has lamented that ``the most striking
fact about American economic history and politics is the brutal and
systemic underdevelopment of Black people.'' \18\ When the Emancipation
Proclamation was signed in 1863, the Black community owned a total of
0.5 percent of the total wealth in the United States. This number is
not surprising; slaves were forbidden to own anything, and the few
freed Blacks living in the North had few opportunities to accumulate
wealth. What is staggering is that more than 150 years later, that
number has barely budged--Blacks still own only about one percent of
the wealth in the United States.\19\ When Martin Luther King stood on
the steps of the Lincoln Memorial in 1963, he said that ``America has
given the Negro people a bad check, a check which has come back marked
`insufficient funds.' '' \20\
---------------------------------------------------------------------------
\18\ Manning Marable, How Capitalism Underdeveloped Black America
(Chicago: Haymarket Books, 2015), 1.
\19\ Dalton Conley, Being Black, Living in the Red: Race, Wealth,
and Social Policy in America (Berkeley: University of California Press,
2010), 25.
\20\ Martin Luther King Jr., ``I Have a Dream,'' Speech, Lincoln
Memorial, Washington, D.C., August 28, 1963.
---------------------------------------------------------------------------
* * * * *
______
Submitted Case by Hon. Salud O. Carbajal, a Representative in Congress
from California
------------------------------------------------------------------------
In the United States District Court for the District of Columbia
------------------------------------------------------------------------
Guadalupe L. Garcia, Jr., for
himself and on behalf of G.A.
Garcia and Sons Farm,
9303 North Dona Ana Rd.
Las Cruces, New Mexico 88007
and
Tony and Patricia Jimenez,
3671 Old Toll Road,
Cathey's Valley, California 95306
and
Edward and Norma Flores, Civil Action No. 1:00CV02445
PO Box 963, Judge: James R. Robertson
Chimayo, New Mexico 87522 Third Amended Class Action
Complaint
and
Gloria Moralez,
153 North Effie,
Fresno, California 93721
and
Beatrice and Rodolfo Garza,
109 North Avenue C,
Crystal City, Texas 78839
and
Larry Chavarria and Robert
Chavarria for themselves and on
behalf of Chavarria Farming Co.,
PO Box 386,
Lemoore, California 93245
and
Mr. Rigoberto Banuelos,
6412 S. Walnut,
Fresno, CA 93706
and
Mr. Modesto Rodriquez, Mr. Ruperto
R. Rodriguez, Mr. Modesta Salazar,
Rodriguez Brothers, Inc.,
11618 Pompano Lane,
Houston, TX 77072
and
on behalf of themselves and all
others similarly situated,
including but not limited to the
following individual plaintiffs:
Mr. Esrael Mendoza,
PO Box 944,
Willcox, AZ 85644
and
Mr. Ysidoro F. Mendoza,
PO Box 494,
Willcox, AZ 85644
and
Mr. Ruben Alvarez,
7336 S. Alta Avenue,
Fresno, CA 93654
and
Mr. Salvador Amezquita,
24795 El Rosario St.,
Salinas, CA 93906
and
Mr. Gustovo Arevalo,
228 Tapadero St,
Salinas, CA 93906
and
Mr. Ricardo Arevalo,
228 Tapadero St.,
Salinas, CA 93906
and
Mr. Juan Atayde,
12919 Kennedy Circle,
Salinas, CA 93906
and
Mr. Efrain E. Bernal,
490 Pini Rd.,
Watsonville, CA 95076
and
Mr. Alejandro Camargo,
1478 E. El Dorado,
Reddley, CA 93654
and
Mr. Jose Camargo,
946 E. Carob Avenue,
Reedley, CA 93654
and
Mr. & Mrs. Jose Chaidez,
PO Box 3467,
Clovis, CA 93613
and
Mr. Valentin Cornejo,
153 Live Oak Rd.,
Watsonville, CA 95076
and
Mr. Antonio Espindola,
41650 Road 68,
Diniba, CA 93618
and
Mr. Joe Flores,
PO Box 2771,
Fresno, CA 93745
and
Mr. Jaime Fuentes,
13665 E. Gettysburg,
Sanger, CA 93657
and
Mr. Ramon L. Garcilazo,
583 Mariposa Street,
Salinas, CA 93906
and
Ms. Joanne Garza,
PO Box 36,
Parlier, CA 93648
and
Mr. Norbero Iriarte,
2035 S Whitney,
Fresno, CA 93702
and
Mr. Alberto Jauregui,
6 Newlyn Street,
Salinas, CA 93906
and
Mr. Javier Ledesma,
PO Box 941,
Hollister, CA 95024
and
Ms. Dora Linares,
4822 S. Temperance,
Fresno, CA 93625
and
Mr. Reyes Mancillas,
7299 S. East Avenue,
Fresno, CA 93725
and
Mr. Albert Mendina,
10845 S. Walnut,
Fresno, CA 93706
and
Mr. Angel Medina,
86 Hidden Valley Road,
Royal Oaks, CA 95076
and
Ms. Rita M. Moreno,
86 Hidden Valley Road,
Royal Oaks, CA 95076
and
Ms. Florencio R. Orozco,
2073 Santa Rita St. #15,
Salinas, CA 93906
and
Mr. Espirion Puentes,
6134 W. Belmont Avenue,
Fresno, CA 93722
and
Mr. Mateo Ruiz,
1023 W. Clayton,
Fresno, CA 93706
and
Ms. Stella Ruiz,
5782 S. Elm Street,
Fresno, CA 93706
and
Mr. Ignacio Ruiz, Jr.,
7135 S. Orange,
Fresno, CA 93725
and
Mr. Jose Tellez,
1151 M Street,
Reedley, CA 93654
and
Mr. Enrique Vasquez,
7671 S. Orange,
Fresno, CA 93725
and
Mr. Jess Vasquez,
1626 E. Floral Avenue,
Fresno, CA 93725
and
Mr. Tommy Vasquez,
4636 W. American,
Fresno, CA 93706
and
Mr. Frank Velarde,
1505 E. Main,
Trinidad, CO 81082
and
Mr. Alberto A. Acosta,
PO Box 333,
Animas, NM 88020
and
Mr. & Mrs. Jimmy & Elizabeth
Alvarez,
Star Route, Box 18,
Salem, NM 87941
and
Mr. Juan Cisneros,
PO Box 704,
Questa, NM 87556
and
David Flores,
173 Chickasaw Road,
Hagerman, NM 88232
and
Mr. Oracio Encinias,
3638 Quay Road 63.8,
Tucumcari, NM 88401
and
Mr. Patrick R. Flores,
PO Box 158,
Pecos, NM 87552
and
Mr. Gilbert L. Garcia,
9300 N. Highway 185,
Las Cruces, NM 88007
and
Mr. Homer Garza,
PO Box 34,
Mesquite, NM 88048
and
Mr. & Mrs. F. Richard & Mary Helen
Llanez,
1620 W. OHara Rd.,
Anthony, NM 88021
and
Mr. Edwardo R. Lopez,
10306 St. Hwy. 104,
Tucumcari, NM 88401
and
Ms. Sonja M. Myers,
1356 County Road S.,
Clovis, NM 88101
and
Mr. Roberto Ortega,
1802 W. Washington,
Anthony, NM 88021
and
Mr. Robert Ortega, Jr.,
855 Royce Road,
La Mesa, NM 88044
and
Mr. Edward W. Provencio,
PO Box 38,
Chamberino, NM 88027
and
Mr. George L. Provencio,
2208 W. Washington,
Anthony, NM 88021
and
Mr. Alfredo Alvarez,
9747 Southside Road,
El Paso, TX 79927
and
Mr. Manuel Cantu,
PO Box 973,
San Juan, TX 78589
and
Mr. Alex Contreras,
390 Duhon Drive,
Sour Lake, TX 77659
and
Mr. Joe Contreras,
PO Box 912,
Childress, TX 79201
and
Mr. Luis Contreras,
PO Box 912,
Childress, TX 79201
and
Mr. Tyn Davis,
PO Box 751,
Ft. Hancock, TX 79839
and
Mr. Hector T. Flores,
7535 Adobe Rd.,
El Paso, TX 79915
and
Mr. Juan J. Flores,
7535 Adobe Rd.,
El Paso, TX 79915
and
Mr. Salvador T. Flores,
PO Box 510,
Fabens, TX 79838
and
Mr. Jose Luis Galvan,
PO Box 130,
Ft. Hancock, TX 79839
and
Mr. Albert Garcia,
470 CR 44,
Muleshoe, TX 79347
and
Mr. Jose Gutierrez,
PO Box 21,
Maple, TX 79344
and
Mr. Alberto M. Ortega,
Rt. 3 Box 111,
Mercedes, TX 78570
and
Mr. Rene Ortega,
Rt. 3 Box 108-M,
Mercedes, TX 78570
and
Mr. Greg Ramon,
220 South East 6th Street,
Morton, TX 79346
and
Mr. Guadelupe Rejino,
Route 3 Box 285,
Muleshoe, TX 79347
and
Mr. Roberto Salinas,
PO Box 176,
Smyer, TX 79367
and
Mr. Romeo Salinas,
PO Box 176,
Smyer, TX 79367
and
Mr. Erasmo Valdez,
RR 3 Box 226-A,
Mercedes, TX 78570
and
Mr. Dionicio Valdez II,
1201 Lantana Lane,
Weslaco, TX 78596
and
Mr. Arturo Vasquez,
PO Box 485,
Fabens, TX 79838
and
Mr. & Mrs. Rodolfo (deceased) &
Delia Vasquez,
PO Box 595,
Fabens, TX 79838
and
Mr. David L. Hinojosa, Sr.,
1215 Boyer Ave.,
Walla Walla, WA 99362
Plaintiffs,
v.
Michael Johanns, Secretary,
The United States Department of
Agriculture,
14th and Independence Avenue, S.W.,
Washington, D.C. 20250
Defendant.
Third Amended Class Action Complaint (For Declaration Judgment, Review
of Agency Action, Violations of Equal Credit Opportunity Act,
and Other Relief)
I. Overview
The Congress has created, and heavily funded with taxpayer dollars,
loan programs specifically targeted to provide assistance to those
family farmers unable to secure needed capital elsewhere. The United
States Department of Agriculture (``USDA''), acting through the Farm
Service Agency (``FSA'') and formerly through the Farmers Home
Administration (``FmHA'') (until 1994), is required to administer this
loan program in a fair, equitable and nondiscriminatory manner. In
addition, USDA administers taxpayer funded benefit and disaster relief
programs which significantly impact family farmers and which USDA is
likewise legally obliged to administer free of discrimination.
This lawsuit arises because, unfortunately, for decades USDA has
systematically discriminated against Hispanic farmers and ranchers
(``Hispanic farmers''); indeed, against nonwhite male farmers
generally. Black farmers, Native American farmers and female farmers
have separately initiated litigation attacking the problem. At the core
of each lawsuit is the same problem. Despite repeated warnings of the
consequences of doing so, USDA has maintained, and continues to
maintain, a system of administering its farm credit and non-credit
benefit programs that gives virtually unfettered discretion to local
officials to enforce highly subjective eligibility criteria that, in
turn, give vent to hostility toward minority farmers which deprives
them of an equal, fair opportunity to participate in such programs.
The hostility toward Hispanic farmers and the resulting
discrimination are hallmarks of the decentralized system through which
USDA distributes and administers its loan and benefit programs. More
particularly, this discrimination manifests itself, among other ways,
by seeking to discourage those Hispanic farmers who would dare attempt
to avail themselves of USDA farm credit and non-credit benefit
programs. This discouragement took various forms: first, Hispanics were
consistently discouraged from even applying for loans or benefits;
second, those Hispanics who nevertheless persisted in filing an
application for loans or benefits experienced long delays in processing
their applications; third, they experienced a high denial rate based
upon highly subjective eligibility criteria; fourth, those Hispanics to
whom loans were granted either experienced prejudicial delays in
receiving the needed loans, received less than the requested loan
amount or were subject to burdensome supervised bank accounts
(``SBAs''), and fifth, when those farmers eventually needed loan
servicing assistance, they received delayed or no such assistance. The
difficulty confronting Hispanic farmers is compounded because the USDA
mechanism for handling their discrimination complaints--which USDA
encouraged aggrieved minority farmers to file--was useless. USDA failed
to investigate the complaints, willfully avoided processing or
resolving the complaints, stretched the review process out over many
years, conducted meaningless or ``ghost'' investigations, or simply
failed to do anything. And, USDA has to date failed to take meaningful
remedial action to address the situation.
This situation is all the more egregious both because there is no
real dispute about the facts and because it has persisted for so long.
Beginning in 1965, the United States Commission on Civil Rights
(``Civil Rights Commission'') has published a series of studies
documenting the nature and extent of USDA's discrimination against
minority farmers in the delivery of loan and benefit programs.
Congressional committees, the General Accounting Office (``GAO'') and
others outside USDA have recognized the pervasiveness of the problem
and urged USDA to reform. Indeed, USDA conducted its own internal
investigations of the problems, conceded that the critics were correct,
and yet has failed effectively to address, much less to remedy, the
problem. Consequently, notwithstanding all the publicity about this
discrimination that infects USDA's farm credit and non-credit benefit
programs and not withstanding all of USDA's lip service to reform,
little has changed for Hispanic farmers.
USDA partially addressed essentially identical complaints by Black
farmers in the Pigford, et. al. v. Glickman, Civil Action No. 97-1978
and 185 F.R.D. 82 (D.D.C. 1999) (approving Consent Decree)
(``Pigford''), but has steadfastly refused to accommodate the concerns
of Hispanic farmers. While the Pigford decree refers to certain
remedial relief that relief has proven to be largely illusory in
implementation and, for all practical purposes, the Black farmer class
received only monetary damages (some $850M to date). This left the USDA
farm and loan benefit system untouched and has become a source of
consternation and discontent to Black farmers who received liquidated
damages only to be confronted by the same discrimination the next time
they applied for USDA farm credit. In addition, USDA has proven unable
or unwilling to reform itself. Congress has likewise been unable or
unwilling to rectify the situation. Out of desperation Hispanic farmers
have chosen the only avenue open to them in their search for fair and
equal treatment. Given the growing numbers of Hispanics who wish to
farm in a effort to improve their economic lot, and given the existence
of USDA loan and benefit programs enacted by Congress for the express
purpose of assisting beginning farmers and ranchers and enabling
existing family farms to continue to operate, it is imperative that the
Court ensure that the necessary reforms are finally undertaken. In so
doing, the Court will not only fix the system for Hispanic farmers but
for all farmers--minority and majority farmers. Secondarily, the Court
should address the damages that are the natural consequence of the
discrimination described herein. In that connection, the use of
computer modeling to calculate any such damages will facilitate the
class-wide treatment of such claims. As the experience of the Pigford
class members makes abundantly clear, to award money damages without
taking the necessary remedial action to eradicate the systemic
discrimination that pervades USDA's credit and benefit programs is, in
the final analysis, a prescription for continued discrimination. This
case presents an opportunity to complete the unfinished business left
in the wake of the Pigford decree and to eradicate once and for all the
discrimination that infects the USDA's farm credit and benefit
programs.
II. Jurisdiction
1. Jurisdiction is founded upon 15 U.S.C. 1691e(a), 28 U.S.C.
1331, 28 U.S.C. 1343, 28 U.S.C. 2201, 42 U.S.C. 2000d, 5 U.S.C.
706 and 7 U.S.C. 2279.
III. Venue
2. Venue lies in this judicial district pursuant to 28 U.S.C.
1391(b) and (e).
IV. Parties
3. Plaintiff and proposed Class representative Guadalupe L. Garcia,
Jr., is an Hispanic American farmer and resident of Dona Ana County,
New Mexico. He and his father and brother, also Hispanic American
farmers, farmed together as G.A. Garcia and Sons Farm. They produced
cotton, peas, alfalfa, and hay on their farm. They owned two farms in
Dona Ana County, one with 550 acres of arable land and the other with
78 acres of arable land. They also leased land occasionally for their
farm operation.
4. In 1986, plaintiff Garcia worked with the assistance of the FmHA
personnel to develop a farm and home plan and an application for direct
loans, but FmHA rejected the application. In 1988, plaintiff applied
for primary loan servicing but was denied this servicing after a 2 year
delay. Again, in 1994, FSA refused to work with plaintiff on a farm
debt restructuring with guaranteed loans. Finally in 1998, when
plaintiff needed to sell part of the land to service delinquent debt
and had found a buyer, FSA refused to provide financing to allow the
sale to take place. In each instance, plaintiff timely filed for the
FSA financial assistance programs or loans and was qualified for the
assistance and loans, but, due to willful and continuous racial/ethnic
discrimination by the local and state FSA offices, was denied the
assistance and loans. In each instance, similarly situated white
farmers received more favorable treatment. As a result, plaintiff
suffered severe economic losses, including a farmer's ultimate
penalty--their farms were sold at a foreclosure sale in 1999.
5. Plaintiff filed several complaints with USDA about this
treatment. Guadalupe L. Garcia, Jr., registered a complaint regarding
the discrimination with the FSA official that assisted plaintiff
prepare the farm and home plan/loan application in 1986. Again, in the
early 1990s, he filed a complaint with the office of Senator Dominici
and USDA. In 1998 and 2000, he filed additional complaints with USDA's
Office of Civil Rights. USDA never acted on these complaints thereby
causing plaintiff further damages.
* * *
6. Plaintiffs and proposed Class representatives Tony and Patricia
Jimenez are Hispanic farmers and residents of Mariposa County,
California. They operate a 299 acre cattle ranch. Tony Jimenez has
lived on a cattle ranch since he was 9 years old, and has life-long
experience operating dairy and beef cattle ranches.
7. They received a $200,000 farm ownership loan from FmHA to
acquire the ranch in 1989 and had sought an operating loan at the same
time. The operating loan was absolutely essential to enable them to
operate the ranch at full and efficient capacity, which was necessary
so that they could service the large ownership debt. They were denied
the operating loan without explanation. They reapplied for the
operating credit in 1990 but were denied. In 1992, they applied for an
emergency loan, but were turned down. In 1992, they also requested a 60
day extension on their loan because cattle prices were at a 20 year low
and they needed to sell cattle to make their loan installment to FmHA.
This too was denied. In December 1995, the Jimenezes paid FSA (formerly
FmHA) more than $52,000 to bring the mortgage on the ranch up to date,
and at the same time they asked for a loan deferral and an adjustment
in the interest rate on the remainder due on the mortgage loan to
reflect substantial reduction in interest rates since 1990. FSA did not
provide them the application for this servicing for 4 months. Then,
after holding the application for 2 years, FSA denied it in October
1998.
8. This extended pattern of denial of loans and services--treatment
different than that received by similarly situated white farmers--was a
series of acts of willful and continuous racial/ethnic discrimination,
and as a result of the discrimination, the ranch operation has suffered
severe economic losses and the Jimenezes are on the verge of losing
their farm to foreclosure. They filed civil rights complaints with USDA
and Members of Congress in a timely fashion, but these complaints have
never been acted on, causing them further damages.
* * *
9. Plaintiffs and proposed Class representatives Mr. Edward and
Mrs. Norma Flores come from a long tradition of farming. They began
farming in 1972. For 16 years, Mr. and Mrs. Flores farmed over 300
acres. Their crops included chili peppers, cotton and cabbage.
10. Between 1985 and 1988, USDA discriminated against Mr. and Mrs.
Flores on at least four separate occasions. Their experience is typical
of other Hispanic farmers in their area.
11. In January 1985, Mr. and Mrs. Flores applied at their local
FmHA office for an operating loan of approximately $100,000. They
needed the loan to prepare for planting their crops by March, but
funding was delayed until late May, well after planting season.
12. A similar incident occurred a year later in 1986. They again
applied for an operating loan in January, which they did not receive
until late May. In addition, FmHA demanded excessive collateral for the
loan. Mr. and Mrs. Flores were required to put up their land (valued at
$413,000) and equipment (valued at $60,000) for a loan in the amount of
$80,000.
13. In 1987, Mr. and Mrs. Flores sought assistance from FmHA to
refinance their farm, because they were facing foreclosure by the
Federal Land Bank. Mr. and Mrs. Flores needed to take advantage of the
lower interest rate offered by FmHA, as opposed to the high 14%
interest they were paying. When they asked the local FmHA agent about
refinancing, he replied ``You're in a real mess,'' and refused them an
opportunity to apply.
14. Mr. and Mrs. Flores were discriminated against because they are
Hispanic farmers. Similarly situated white farmers did not receive such
treatment. In 1987, Mr. Flores complained regarding this discriminatory
treatment.
15. In 1988, Mr. Flores returned to the local FmHA office to
attempt again to refinance his farm. Contrary to FmHA regulations, the
local FmHA office agent refused to discuss refinancing with Mr. Flores
until Mr. Flores father had cleared a separate unrelated debt with
FmHA.
16. 1988 was the last year the Flores family farmed. As a result of
FmHA discrimination, they lost everything, including eight farm
leases--all of which were taken over by white farmers.
* * *
17. Plaintiff and proposed Class representative Gloria Palacios
Moralez is an Hispanic farmer and resident of Fresno County,
California. Her parents were sharecroppers for 25 years, including when
she was growing up; and she learned farming from them. She also took
college courses in agricultural economics, and was selected to be a
Kellogg fellow. She owned and operated an 80 acre farm from 1980 to
1998. Up until 1994, she grew various field crops and grapes. In 1998,
after repeatedly being denied loans and services from FSA, her land was
sold by court order and she lost it.
18. Ms. Moralez acquired her farm land in 1980 with a $200,000
limited resource farm ownership loan from FmHA. However, even in this
instance, FmHA engaged in discriminatory conduct against her by working
hard to discourage her from getting the loan; she got it only through
her own dogged persistence and hard work. Originally, FmHA would not
even let her apply for the loan although she clearly had the background
and training to qualify for FmHA farm financing. However, after she
refused to take no for an answer, she was allowed to apply--but then
only after she was forced to write a special essay and make special
presentations to the Fresno County FmHA staff and county committee.
These unusual requirements were never applied to white farmers who
sought to apply to FmHA for farm ownership loans. Further, the chairman
of the county committee told her to her face that farming was ``not a
proper business for a woman, much less a Mexican woman with two kids.''
Once she filed her loan application, it was improperly rejected two
times before it finally was accepted. One rejection was based on the
premise that the property she was trying to acquire did not have
sufficient water to farm it correctly. However, this same property was
being farmed at that time by two white farmers whose farming operations
were financed with FmHA operating loans. Another reason her application
was initially rejected was that the FmHA county office asserted that
she was proposing to pay too much for the land. However, at the same
time, the county office was making farm ownership loans to white
farmers to buy similar land in the area her farm was located at even
higher prices than she proposed to pay.
19. In 1981, Gloria Moralez applied to the Fresno County FmHA for
an equipment loan of $50,000. She was approved for only $26,300. As a
result, she could only acquire used equipment in poor condition that
caused her severe problems in growing her crops and reduced her
production. She also received an operating loan of $31,200 to plant
cotton. Her loan funds were put in a supervised bank account. To her
information and belief, no similarly situated white farmers in her area
were subject to this sort of treatment regarding reduced funding for
equipment loans and the supervised account. Further, the Fresno County
FmHA staff told her at that time that she should never apply for
another FmHA loan, because they would make sure she never got one. In
fact, she never did get another FmHA loan.
20. She continued throughout the years up to 1998 to seek FmHA and
FSA loans, services, and benefits, but was always unfairly discouraged
and ultimately denied. Her applications included ones for restructuring
her debt, so-called ``1951-S'' servicing, and disaster payments. The
1951-S servicing is an example of the unfair discouragement she
received. FmHA valued her farm low for 1951-S purposes so she could not
benefit from 1951-S restructuring; but just 6 months later when she was
in bankruptcy, FmHA insisted that the farm had a much greater value for
purposes of the bankruptcy action.
21. In 1993, she applied for disaster payments for losses to her
grape crop in 1993 caused by a grape disease known as phomophis. This
disease reduced her yield by 69 percent. The Fresno county office told
her that the[r]e was no such disease. However, this disease in fact has
become epidemic in California in recent years and a threat to the grape
industry statewide, with the state and Federal Governments spending
millions on its eradication. Also, the county office accused her of
fraudulently submitting two claims for payments on the loss. In fact,
what happened was that she had submitted her disaster application in
September 1993, then in December 1993 checked with the Fresno County
FmHA to see where it stood. At that time, she was told that they could
not locate the September application, and that she must fill out a
second application, which she did. Further, when she appealed the
denial of disaster benefits to the county committee, she attempted to
have a court reporter transcribe the meeting. However, the county
committee refused to allow the reporter to attend the meeting, stating
that she had to give notice 7 days in advance. The problem was that
they had scheduled the meeting 1 day in advance.
22. As a result of FmHA/FSA's unfair discouragement and denials,
Gloria Moralez could never obtain the financing or program payments she
needed to adequately farm her land, and thus her farming enterprise
foundered. When she became seriously ill and her mother died in January
of 1992, Gloria Moralez was forced to file Chapter 12 bankruptcy.
During the 5 years she was in bankruptcy, FmHA/FSA continued to harass
her. The agency made several attempts to foreclose on her land even
though the bankruptcy court had issued a stay on foreclosure
proceedings. The agency had gone so far as to order its Kansas City
financial office to cut a check for $220,000 so it could buy the land
back at foreclosure, even though there was a freeze against
foreclosure.
23. She filed discrimination complaints with USDA in 1984, 1985,
1986, 1987, 1988, 1989, 1990, 1992, 1993, and 1994 regarding the
denials and problems she was having with FmHA/FSA, but only on one
occasion received a response to her complaint--that regarding the
denial of disaster payments in 1993 described above. However, even that
action to respond to her complaints was tainted. First of all, she did
not get a response to her complaint until 1998. At that time, she
received a letter in response to her complaint purportedly signed by an
official working for defendant by the name of Wardell Townsend. The
letter stated that USDA found no discrimination. The problem with the
letter was that Townsend, who supposedly made this conclusion, had left
USDA about 1 year prior to the date he supposedly signed the letter.
24. The long and persistent pattern of denial of loans and services
by FmHA/FSA during the period from 1981 on--treatment different than
that the agency gave to similarly situated white farmers--was a series
of willful and continuous racial/ethic discrimination; and as a result
of the discrimination, Morelez's farm operation suffered severe
economic losses and she ultimately lost her 80 acre farm. The absolute
refusal by defendant to respond to her repeated complaints of
discrimination caused her further damage as the complaints were never
investigated and the wrongs committed against her thus have remained
un-remedied.
* * *
25. Plaintiff and proposed Class representatives Rodolfo and
Beatrice Garza are Hispanic Americans residents of Zapala County,
Texas, who farmed in the 1980s. Rodolfo Garza had been trained in
agriculture at the local junior college, and, in 1983, he and Beatrice
Garza acquired 39 acres of farm land in Zapala County from Beatrice's
parents for the purpose of starting a vegetable production operation.
This land is located in the Wintergarden area of Texas, which is renown
for its production of fruits and vegetables. Their hometown, Crystal
City, is known as the Spinach Capital of the World. Unable to get FSA
financing to operate their farm, they farmed to the extent they could
using their personal funds. They successfully put in several crops of
spinach, onions, and grain sorghum.
26. In 1984 and 1986, the local newspaper ran articles about the
availability, at the local FSA office, of loan funds for farming. In
1984, the Garzas sought a loan to irrigate and put in crops on all 39
acres. They submitted an application to the local FSA office, and
waited for a response. FSA never responded, so Beatrice Garza contacted
the office and was told that no money was available for loans. However,
when she reminded the office of the article in the local newspaper,
they simply told her that she and her husband did not qualify. Again in
1986, having read another article about the availability of funds, the
Garzas applied for an operating loan again. They were turned down
again. The Garzas knew that a number of white farmers who were friends
of theirs and similarly situated farmers were able to obtain operating
loans from FSA without any trouble. These included Charles Carr, Lake
Smith, and Dorothy Hodges. In fact, these farmers advised the Garzas to
apply to FSA for financing.
27. Concerned about these repeated denials, Beatrice Garza timely
complained by letter to the Secretary of Agriculture in 1986, but never
received even a response to the letter. Having been frustrated at
obtaining financing from FSA and unable to finance the farm through
local cooperative or commercial banks, the Garzas had to abandon their
farm operation and sell the land. As a result of the discriminatory
acts, the Garzas have suffered substantial economic losses and as a
result of the Secretary of Agriculture ignoring their complaint about
the loan denials, the Garzas suffered further damages.
* * *
28. Plaintiff and proposed Class representatives Larry and Robert
Chavarria are third-generation Hispanic American farmers in Kings
County, California. They have been farming for 17 years. They primarily
grow crops on the family farm owned by their mother. It is a 640 acre
tract with irrigation that is ideally suited for cotton and other row
crops, as well as fruits and vegetables. Their grandfather cleared the
land in 1944, and their family over the course of years has installed
irrigation equipment on the land. They farm together as a general
partnership, the Chavarria Farm Co. Neither Larry, Robert, nor the
partnership had any dealings with FSA prior to 1997.
29. In 1995, the partnership suffered severe losses to their cotton
crop, as did many other farmers in that area of California. The area
was declared a disaster area and the Chavarrias sought to obtain a
disaster loan from FSA to cover losses from the 1995 crop. Larry began
his inquiries in September 1996, and filed the application in January
1997. Although the application was complete and demonstrated that the
Chavarrias and the partnership fully qualified for assistance, the
Kings County FSA improperly rejected the application on grounds that
were later determined by the National Appeal Division (``NAD'') to be
without merit. In doing so, the FSA office gave excess credence to the
assertions of a white landowner from whom the Chavarrias were leasing
farm land and with whom the Chavarrias had a dispute regarding the
white landowner's efforts to revoke the lease.
30. Larry Chavarria appealed the county office decision to the NAD
and won the appeal. The hearing officer's decision substantially
discounted the credibility of the white land owner and questioned the
county office's giving weight to that person's assertions and the
county office's abortive efforts to set Mr. Chavarria in a ``sting''
regarding the crops grown on the disputed lease land.
31. Even though Larry Chavarria won the appeal, the Kings and
Tulane County FSA office continued to subject him and the partnership
to unfair treatment. That office has denied them Production Flexibility
Contract payments for the 1997 crops; it has been uncooperative and
unwilling to work with him on servicing the emergency loan following a
second disaster in the area in 1998.
32. FSA's initial loan denial and inadequate loan servicing were
treatment different than that the agency gave to similarly situated
white farmers, and amounted to willful and continuous racial/ethnic
discrimination. As a result of the discrimination, the Chavarria farm
operation suffered substantial economic losses.
33. Larry Chavarria filed a complaint with the Office of Civil
Rights (``OCR'') regarding this discrimination in 1999. Incredibly, the
OCR responded that FSA's denial of the loan and related unfair acts did
not raise an issue of discriminatory conduct by a USDA employee, so it
was refusing to investigate the complaint. Further, the response letter
was dated April 28, 2000, but was not postmarked until September 12,
2000. The refusal by defendant's agency to respond to the complaint of
discrimination caused Larry and Robert Chavarria and the partnership
further damage as the complaint was never investigated and the wrongs
committed against them thus have remained un-remedied.
* * *
34. Plaintiff and proposed Class representative Rigoberto Banuelos
has been farming in the Fresno, California vicinity since 1988. He
acquired a 10 acre parcel in January 1986 and another 20 acre parcel in
May 1988. Mr. Banuelos grows seedless grapes that are used to make
raisins.
35. In 1988, 1991, and 1992, he went to the Fresno, California FmHA
office to inquire into applying for loan assistance. On each visit Mr.
Banuelos was told that there was no money available and that no one in
the Fresno office spoke Spanish so they could not talk to him. Although
Mr. Banuelos informed the FmHA officials that his wife, who accompanied
him on each visit, spoke English well, he was ignored. He never
received an application and was told to try private banks because FmHA
could not help him.
36. Although Mr. Banuelos repeatedly complained that FmHA did not
treat him as fairly as they treated white farmers, he was not able to
secure a loan from FmHA. Consequently, he was unable to install a new
irrigation system on his farm that would have doubled his productivity.
* * *
37. Plaintiffs and proposed Class representatives Modesto
Rodriguez, Ruperto Rodriguez and Modesta Salazar are shareholders of
Rodriguez Brothers Inc (``RBI''). RBI is a family owned farm of 523
acres located outside of Pearsall, TX. The Rodriguez family has owned
the farm since 1952. From 1982 to 1997, Modesto Rodriguez was the
principal operator of the farm.
38. During the time period covered by the complaint, RBI borrowed
funds from the Frio County FmHA office. Many, if not most, of the loans
made to RBI were required to be placed in SBAs despite many years of
farming experience. In 1989, RBI submitted a written complaint alleging
that FmHA and its Frio County supervisor discriminating against RBI by,
among other things, imposing SBAs on RBI and USDA's failure to release
SBA funds to permit RBI to feed its livestock during a drought.
39. In that same year, RBI also sought primary loan servicing. Nine
months later its application was denied. RBI appealed the adverse
decision and the NAD hearing officer ruled that the county supervisor
had acted improperly in denying the loan application and that RBI was
entitled to a loan and loan servicing. The hearing officer also found
that the continued use of SBAs was not appropriate and reversed FmHA's
decision to impose a SBA. Despite the favorable ruling by the NAD
hearing officer on behalf of RBI, USDA, more than a decade later, has
yet to provide the required loan servicing to RBI to which it was
declared to be entitled.
* * *
40. Defendant, Michael Johanns, is Secretary of the United States
Department of Agriculture, and is the Federal official responsible for
the administration of the statutes, regulations and programs that are
the focus of this action.
V. General Background: The USDA Farm Loan and Benefit Programs and How
They Are Administered
A. Brief Description of the Programs and How USDA Implemented Them
41. The Federal agricultural programs at issue in this litigation
have their genesis in the New Deal agriculture reform legislation aimed
at controlling farm production, stabilizing farm income and generally
helping farmers remain operational to the extent possible. In enacting
this legislation, Congress recognized that the maintenance of a diverse
domestic base of producers of food and fiber--particularly family farms
and ranches--was a matter of national security.
42. Congress provided for the creation of the Agricultural
Stabilization and Conservation Service (``ASCS'') as the division of
USDA charged with the responsibility for administering these programs.
The basic approach to stabilizing farm income and commodity prices was
to allow farmers to borrow against their crops and, if prices remained
low, the crops would be forfeited to USDA with farmers receiving a high
enough support price to permit them to pay off their crop loans and to
keep enough money to remain economically viable. The ASCS was
responsible for managing the commodities forfeited to USDA, to purchase
other commodities as part of an effort to raise prices and to inspect
the warehouses in which the commodities were stored. The amount of
funds available to farmers in these programs and the manner in which
the programs are to be administered are periodically modified by
Congress with each new farm bill.
43. Because Congress wanted to maximize the input of local farmer
interests in order to ensure that the administration of the ASCS
programs truly reflected local needs, it established a decentralized
network of county committees (``COC'') each composed of three county
farmers elected by the farmers from each county. Each COC hired both
the county supervisor who actually ran the county office as well as the
local staff who administered the distribution of such payments in each
county. The legislation also provided for a state level committee and a
state executive director. Each COC determined which farmers were
eligible for support and benefit payments and worked with the state
committee and its director to calculate the amount each farmer was
entitled to. Although the Secretary of Agriculture, with presidential
approval, technically appoints the state executive director and the
state ASCS committee members, the tradition is that the senior member
of each state's congressional delegation who is of the same political
party as the President actually controls the selection process. The
county committee, the county supervisor and the county staff are state
or county employees whose salaries and benefits are paid from Federal
funds appropriated as part of the USDA budget. Despite this fact, the
Secretary of Agriculture and the Washington headquarters staff have
never effectively managed the state and county offices.
44. In addition to ASCS, the New Deal reforms enacted by Congress
created three additional farm agencies. The FmHA which loaned money to
farmers who could not obtain credit elsewhere for land purchases,
operating expenses and construction of homes on their farms, and also
provided technical assistance and (unlike traditional lenders) worked
closely with farmers in an effort to help them survive. These loans
include ``farm ownership,'' ``operating,'' and ``continuing
assistance'' loans, as well as loans that restructure existing loans
and ``emergency disaster'' loans. Congress specifically designed such
programs to provide assistance to those family farms, particularly
small, minority and otherwise disadvantaged farmers who typically
cannot secure loans from private lenders. FmHA thus became the lender
of last resort.
45. In creating FmHA, Congress established a separate, stand-alone
FmHA county committee system which in most important respects
paralleled the above-described ASCS county committee network. In each
state, there was a politically appointed FmHA director, and he (unlike
ASCS) appointed local county FmHA committees whose functions were to
initially determine eligibility for loans and then to review
recommendations by the county FmHA offices regarding which loan
applications should be approved. The county FmHA offices, unlike ASCS,
were staffed by Federal employees of USDA.
46. The Soil Conservation Service (``SCS'') was created to assist
farmers in improving and maintaining the productivity of their land.
Finally, Congress established the Federal Crop Insurance Corporation
(``FCIC'') to manage the federally subsidized crop insurance programs.
47. As a consequence of the way Congress structured the mechanisms
for administering these farm programs, USDA became a decentralized
institution that placed broad, largely unfettered discretion in local
officials to apply highly subjective eligibility criteria to farmers
seeking to participate in USDA credit and benefit programs.
Historically, USDA has permitted each of the core farm loan and benefit
agencies within USDA to function essentially as uncoordinated and
independent agencies, each with its own distinct policies, procedures
and record keeping requirements and its own separate network of county
committees. Given the vast sums of taxpayer dollars channeled into farm
loan and benefits programs via the USDA--until recently it ranked
second only to the Department of Defense in the total amount of Federal
dollars appropriated to it--the virtual lack of true transparency and
meaningful accountability which has long characterized USDA stewardship
of such monies is unprecedented.
48. Numerous congressional oversight efforts, GAO studies and other
reports--all uniformly critical of the manner in which USDA
administered the farm loan and benefit programs--prompted Congress in
1994 to fundamentally reorganize USDA. In the fall of 1994 ASCS and
FCIC were merged to form a new FSA, and the FmHA was split in two with
its farm loan division folded into FSA and its home and business loan
division absorbed by a newly created Rural Development Agency
(``RDA'').
49. The attempt to merge FmHA's farm loan division with the myriad
ASCS farm programs has proven to be extraordinarily difficult because
the policies, procedures and particularly the ``culture'' of each
agency were so distinct. The overriding problem is that FmHA employees
were direct employees of the Federal Government operating within
policies, procedures and record keeping systems promulgated by USDA
headquarters to a much greater extent than ASCS, whereas the members
and staff of the ASCS county committees were employees operating
outside the Federal employee structure in a decentralized manner
notwithstanding that Federal funding underwrote their salaries.
Additionally, the orientation of each agency and its distinct COC
network was markedly different, e.g., ASCS distributed subsidies and
disaster payments which generally do not have to be repaid, whereas
FmHA made loans which had to be repaid.
50. Because the parallel decentralized county committee networks
which traditionally played a substantial role in the administration of
both ASCS benefit programs and FmHA loan programs was obviously
unworkable in the revamped system, it was incumbent upon the Secretary
to blend the two networks. It wasn't until the late 1990s that the
Secretary decided to make the ASCS COC network preeminent, causing the
FmHA network to atrophy. Although progress has been made in merging
these disparate entities, in many areas the intramural tensions and
resulting dysfunction remain problematic because of resistance of FmHA
employees to accept county employees as coequal colleagues and because
the ASCS county employees feared federalization.
51. The current structure is that in each state the Secretary
appoints a state FSA director who is a political appointee anointed by
state political apparatus. Thus, in point of fact the state FSA
director is often more beholden to his political benefactors within the
state than to the Secretary. Furthermore, the surviving county
committee system, along with state director and state committee,
created by Congress, continues to exist and function notwithstanding
the absorption of ASCS by FSA, thereby perpetuating the conflicts and
confusion which plagues the administration of these farm programs.
B. An Overview of the Process By Which FSA Administers Farm Loan and
Benefit Programs
52. Generally speaking, the process begins when the Congress
annually appropriates specific amounts of taxpayer dollars to fund the
various farm loan programs. The Secretary of USDA then allocates a
specific portion of those funds to each local FSA office for
distribution to eligible farmers and ranchers. Should a particular
local office not commit all the funds allocated to it for a particular
program, those funds are transmitted back to the Secretary for
reallocation to those county offices which need them.
53. Virtually every farmer has to borrow the money needed to
finance the next season's crops--the cost of seed, fertilizer,
additional equipment or land. Crop and equipment loans are very time
sensitive--the application needs to be approved and the loan made in
advance of the upcoming planting season.
54. Many farmers are able to secure the necessary financing from
private lenders. For new farmers and those whose financial condition
fails to meet the standards set by private lenders, the lender of last
resort is USDA which offers both direct loans and guaranteed loans (the
loan is made via a commercial bank on the USDA approved list and USDA
guarantees it).
55. The first step in the process of securing a USDA farm loan is
for the farmer to visit the county FSA office to obtain a copy of the
loan application form.
56. The next step is for the farmer to fill out the loan
application and to prepare a Farm and Home Plan which essentially is a
financial (cash flow) plan for his farming operation. As noted, the
regulations created by USDA (7 CFR 1901 et seq.) to govern the loan
program are enormously detailed and complex. As a consequence, most
farmers need considerable assistance to fully and appropriately
complete the complex application paperwork, particularly the Farm and
Home Plan, which is central to the application. In recognition of this,
USDA regulations direct local FSA loan officers and their staff to
provide assistance--particularly to family farmers--in their efforts to
secure the financing necessary to remain operational. Increasingly,
those farmers who can afford to do so hire third party ``loan
packagers'' to guide them through the application process. In sum, in
order for the USDA loan program to accomplish its goal of helping those
farmers most in need, it is obviously imperative that a spirit of
cooperation and understanding exist between the farmer and the local
FSA personnel.
57. Once all the necessary paperwork is completed to the
satisfaction of the local county FSA loan officer, the application is
formally deemed submitted and the review approval process technically
begins to run. The FSA loan officer reviews the file and makes a
recommendation which he transmits to the COC for approval. Once
approved, the file is sent back to the FSA loan officer who executes
the formal loan documents and arranges for the transmittal of funds to
the farmer.
58. Prior to the 1994 reorganization the farm loan application/
approval process was all handled within the FmHA, with the county
committee making the threshold determination regarding eligibility and
then, if the applicant is deemed eligible, with the county director
deciding both whether the paperwork was properly completed and
ultimately whether to approve the application. Then the county
committee staff would administer the loan and provide any necessary
servicing.
59. Should an applicant be unhappy with the decision, he has the
right to appeal the decision to the state FmHA committee and, if still
unsatisfied, can seek administrative review via the National Appeals
Division (``NAD'') which is headquartered at USDA headquarters in
Washington and maintains a network of regional and state offices.
60. Additionally, the Equal Credit Opportunity Act (``ECOA'')
prohibits discrimination in credit based on sex, marital status, race,
color, age, national origin, or religion. 15 U.S.C. 1691(a). If an
FSA loan or loan service is denied on discriminatory grounds, the
farmer can file a discrimination complaint with the defendant and the
FSA Civil Rights Office (for FmHA, formerly the Equal Opportunity
(``EO'') office) or with the Office of Civil Rights (``OCR'') (formerly
known as the Office of Civil Rights Enforcement and Adjudication
(``OCREA'' or ``CREA'')).
61. As regards benefit payments, Congress must first appropriate
funds earmarked for disaster (freeze; flood; drought; hurricane[,]
etc.) relief. Then the funds are allocated to the affected states for
distribution to eligible farmers. Prior to the 1994 reorganization a
farmer had to visit the local ASCS county office to ascertain whether
such funds had been allocated to that county, how many funds remained
available and whether the farmer qualified for such payments. The
process is administered pursuant to ASCS regulations (7 CFR part 700,
et seq. and Commodity Credit Corporation (``CCC'') regulations (7 CFR
part 1400 et seq.). The ASCS county staff was the initial point of
contact and aided the county supervisor in making recommendations to
the ASCS county committee as regards eligibility and the amount of
benefits to be paid to each farmer. Approval by the county committee
was the key. Those not receiving a favorable response had the right to
appeal to the state committee. Post reorganization, farmers denied
benefits continue to have a right of appeal but such appeals are
rechanneled via FSA's NAD. Additionally, the Constitution and Title VI
of the Civil Rights Act of 1964 prohibit exclusion from participation
in Federal programs based on race, color or national origin. With
respect to ASCS-type applications, if a farm program application is
denied on discriminatory grounds, the farmer can file a complaint of
discrimination with the defendant or OCR.
62. Post reorganization the functions of the ASCS county office
have been consolidated with the local FSA office, although many of the
county staffers still work there. The allocation of disaster funds
available to the affected counties is made at the Federal and state
levels, but the determinations regarding eligibility (including
inspections of the damage) and the distribution of the funds is carried
out at the local FSA level after the county committee formally approves
recommendations by the local FSA office regarding eligibility and
distribution amounts.
VI. Systemic Discrimination Against Hispanic Farmers Has Pervaded the
Administration of Farm Loan and Benefit Programs By USDA from
1981 To Date
A. The Various Ways In Which Hispanic Farmers and Ranchers Experienced
Discrimination When They Sought Farm Loans and Benefits
63. At the outset it must be emphasized that historically those
areas of the United States where there was a substantial Hispanic
population, Hispanics experienced systemic de jure and de facto
discrimination not unlike that experienced by Blacks in other parts of
the country. And, USDA's decentralized administration of credit and
benefit programs gave full vent to those regional and local prejudices.
64. In addition, for those Hispanic farmers who are not conversant
with the finer points of written English the application forms and the
extensive directions explaining how to fill them out, which until
recently were available only in English, were daunting obstacles. These
obstacles were made all the more daunting to some Hispanic farmers
because most local FSA offices, and virtually all of the county
committees and county offices, lacked personnel sufficiently
[conversant] in Spanish to provide the desperately needed guidance.
Even more fundamentally, the putative class has encountered a wall of
hostility, manifested in variety of ways, from the staff of such
offices. Thus, the Congressional mandate that the local FSA and county
offices work closely and helpfully with all applicants has consistently
fallen on deaf ears in both those decentralized USDA outposts serving
areas with heavy Hispanic farm constituencies and USDA headquarters
which is primarily charged with carrying out that mandate.
65. Such local offices are dominated by white males who mirrored
the anti-Hispanic prejudices which permeated those areas of the country
and, to a large extent, continue to do so. There was and continues to
be hostility toward Hispanics in many of these county and state
offices. That hostility manifests itself in a variety of ways,
including attempting to discourage Hispanic farmers from availing
themselves of farm credit and non-credit benefit programs.
66. Hostility and discouragement pervade every stage of the credit
or benefit process. Starting with obtaining an application, the
Hispanic farmers are often discouraged from even obtaining an
application. Indeed, it is common for Hispanic farmers to be told that
they are too late because all the loan and/or benefit monies are gone,
hence it was pointless to provide an application to them. Consequently,
a number of Hispanic farmers simply gave up and went home without an
application when so informed. Those Hispanic farmers who nevertheless
pressed for a copy of an application form were often refused a form
because office personnel told the farmers that they either were too
late or the office did not have applications, only to discover that
white farmers not only still received applications but succeeded in
obtaining loan or benefits notwithstanding that the funds allegedly had
already been spent or the supply of applications already exhausted.
67. None of the county offices or FSA offices employed any type of
``receipt for service'' system which recorded the fact that Hispanic
(or any other) farmers visited the office to inquire about programs
availability. Thus, there is no transparency as regards conduct in this
crucial aspect of program administration.
68. Similarly, many Hispanic farmers were advised during their
initial visit that they did not qualify for either loans or benefits--
this without any application having even been filled out. Such tactics
repeatedly occurred notwithstanding that the regulations promulgated
pursuant to the ECOA and USDA's own regulations proscribe efforts to
discourage minority farmers from applying for loans. 7 CFR 1910.
69. Those Hispanics who succeeded in obtaining the application
forms were often denied the assistance needed to both comprehend and
properly complete the application. They would be told that the
applications was self-explanatory, and should be completed by the
farmer at home. Hispanic farmers who nevertheless requested help in
completing the application were often made to feel stupid for
requesting assistance and told that the office personnel did not have
time to assist them. In some instances, they were urged to retain the
services of expensive loan packagers, which few could afford to do.
70. Those Hispanic farmers who persisted and completed the
application then had to successfully navigate a two-step process.
First, the applicant had to demonstrate that he or she was eligible to
receive either a loan or whatever form of benefits (usually disaster
benefits) he or she sought. The second step is securing approval of the
application itself. For most of the period covered by this complaint,
the county committee made this critically important eligibility
determination--the FmHA county committee for loans and the ASCS county
committee for benefits and, post the 1994 reorganization, the FSA
county committee for both loans and benefits. This localized decision
making structure was, from the perspective of Hispanics, fatally flawed
in two crucial respects.
71. First, the county committees were dominated by local white male
farmers in what can best be described as a closed system. The Civil
Rights Action Team (``CRAT''), a group of senior USDA officials
appointed in 1996 by then Secretary Glickman to conduct a comprehensive
investigation of alleged systemic discriminatory conduct by USDA,
reported that:
In 1994, 94 percent of all county committees had no female or
minority representation. Minority producers were 4.7 percent of
eligible voters, but held only 2.9 percent of county committee
seats. . . . GAO found that in 1995, only 36 of the 101
counties with the largest concentration of minority farmers had
at least one minority county committee member. CRAT Report at
p. 3.
72. Thus, in those counties with the largest concentration of
Hispanic farmers, the county committees are populated virtually
exclusively by non-Hispanics who invariably reflect regional and local
anti-Hispanic prejudices. Compounding the problem is the obvious
conflict of interest which lies at the core of this localized
administrative process--e.g., the dominant group of farmers (white non-
Hispanic males) controls the distribution of monies for which they
themselves also compete. The playing field is clearly not level.
73. The second major defect in the USDA system is the unfettered
discretion vested in the county committees in applying the highly
subjective criteria governing the USDA credit and benefit programs.
This combination of anti-Hispanic bias and unfettered discretion
invites and facilitates discrimination.
74. For example, in administering USDA loan programs, the county
committee was, for most of the period covered by the complaint,
required to consider seven criteria: (1) United States citizenship; (2)
the legal capacity to incur loan obligations; (3) education and/or
farming experience in managing and operating a farm or ranch; (4)
character and industry to carry out the proposed operation; (5) a
commitment to carry out undertakings and obligations; (6) inability to
obtain sufficient credit elsewhere; and (7) farm size (the farm to be
no larger than a family farm). Once eligibility was determined, the
county executive director or loan officer had to approve the loan by
determining, inter alia, whether the farmer had a viable farm and home
plan. All the criteria except citizenship and age are highly subjective
and thus easily subverted by persons practicing discrimination.
75. Similarly, in administering the disaster benefit and other
benefit programs, the county committees are vested with broad
discretion in determining which farmers are eligible to receive
benefits. The criteria used are also highly subjective. For example,
the farmer applicant must establish that his disaster related loss
isn't related to ``the neglect or malfeasance of the producer `. . . or
. . .' the failure of the producer to follow good farming practices for
the commodity and practice.'' 7 CFR 1437.9(b)(1) and (3). Terms such
as ``neglect'' and ``good farming practices'' can easily be applied in
a subjective, discriminatory and arbitrary manner and given the
generalized language in which such decisions are phrased, adverse
decisions are difficult to reverse on appeal. The county committees
readily understand all this.
76. The regulations promulgated by USDA to govern the
administration of its farm loan and benefit programs have not only
failed to prevent the discrimination experienced by Hispanic farmers,
but have in fact contributed to and facilitated that discrimination by
vesting in local official unfettered discretion to apply highly
subjective eligibility criteria. Despite repeated warnings that the
combination of unfettered discretion and highly subjective eligibility
criteria invites and facilitates discrimination, USDA has done nothing
to curtail the delegated discretion or to reduce the subjectivity in
the eligibility criteria.
77. The record keeping procedures maintained by the county
committees and the local and state USDA offices are grossly inadequate
to reveal the true nature and extent of anti-Hispanic discrimination,
which has long pervaded the administration of its farm loan and benefit
programs. Despite the fact that this historic inadequacy has been well
documented throughout the entire period covered by this complaint and
indeed from at least the mid 1960s, USDA has done nothing to improve
its record keeping in a way that would bring transparency to its
lending practices. Thus the farm loan and benefit programs suffer from
a total lack of transparency regarding the actions at the county and
state levels where the discrimination has taken root. Without
transparency there obviously is no accountability, hence the
intractability of the discrimination which has long infected USDA.
78. As early as 1982 the Civil Rights Commission reported its
findings regarding USDA's discrimination against minorities, noting
that as the lender of last resort, the USDA applied primarily
subjective criteria. The report noted that: ``[the] regulations
intended to implement these goals leave room for a wide range of
subjective implementation. . . . The problem of subjectivity permeates
much of the FmHA loan decision process. . . . Lack of specific criteria
for loan determinations potentially enhances FmHA's flexibility and
ability to serve clients. It also creates loopholes which allow for
discriminatory treatment.'' United States Commission on Civil Rights,
The Decline of Black Farming In America, pp. 80-81 (1982).
79. The various consequences of the decades of discrimination
practiced by USDA against Hispanic farmers in the administration of its
farm loan and benefit programs are:
(a) many Hispanics abandoned their intention to apply for a loan
because USDA erroneously asserted that all the loan funds
had already been allocated or because the USDA officials
refused to provide loan application materials;
(b) information about availability of disaster payments or other
benefit programs was either not communicated effectively to
Hispanics at all or too late for them to apply;
(c) as regards both loan and benefit programs, Hispanics typically
experienced hostility, lack of civility, no cooperation or
an unwillingness to provide assistance or information at
all stages of the application process;
(d) USDA personnel exercised unfettered discretion discriminatorily
to declare Hispanics ineligible to obtain loans or to
receive benefits;
(e) USDA personnel exercised unfettered discretion discriminatorily
to deny approval of loans or payments of benefits to
Hispanics deemed eligible to apply for loans or benefit
payments;
(f) in those instances in which defendant approved loans or benefit
payments to Hispanics, approvals were often untimely (well
after the planting season began) and/or for amounts much
less than requested;
(g) defendant often demanded that Hispanics provide a greater amount
of collateral for loans than would otherwise be required
thereby exposing Hispanics to far greater risk;
(h) defendant often conditioned its approval of a loan to Hispanics
upon a willingness to accept a supervised loan account
which required Hispanics to periodically submit to a
monitoring of their farming operations by the local FSA
office as a condition to receiving each incremental release
of previously approved loan funds, which is both burdensome
and insulting;
(i) should Hispanics experience difficulty in making loan payments
(as all farmers and rancher periodically do given the
inherent vicissitudes of nature and commodity markets),
defendant failed to provide loan servicing and to otherwise
work closely and cooperatively as required by law and
regulation in an effort to avoid foreclosure; and
(j) defendant invariably accelerated the foreclosure process when
Hispanics experienced repayment difficulties.
80. Non-Hispanics, particularly white males, experienced the above
described problems to a much lesser extent, if at all, than did
Hispanics because they did not experience similarly discriminatory
policies, procedures and attitudes by defendant.
B. The Anti-Hispanic Discrimination Which Pervades USDA Makes It
Virtually Impossible for Plaintiffs To Secure Redress Through
the USDA Appeals Processes
81. Applicants denied loans or benefits can pursue administrative
appeals. Prior to the 1994 consolidation, FmHA and the ASCS each
operated parallel but separate administrative appeals processes.
Thereafter the NAD was created to handle all such appeals, but NAD had
no authority to consider discrimination complaints.
82. When a Hispanic farmer appealed an adverse decision to the NAD
and prevailed, often the loan supervisor and county committee would
simply refuse to implement the NAD decision and purport to undertake a
complete review of the application, often requiring the submission of
new information because the application was by then more than 90 days
old. Notwithstanding the favorable decision by the NAD with respect to
the appeal, the local officials frequently rejected the revised or
reviewed application, thereby forcing the farmer to either undertake
yet another appeal or give up.
83. Because there has long been a recognition that discrimination
pervades the administration of USDA farm loan and benefit programs,
USDA permits applicants to file a complaint of discrimination either
with FSA Civil Rights Office (formerly the FmHA Equal Opportunity
Office) or with Departmental Office of Civil Rights (``OCR'') (formerly
designated as the Office of Civil Rights Enforcement and Adjudication)
(``OCREA'').
84. In 1983, the enforcement capability of EO and OCREA was so
severely curtailed through lack of funding and lack of interest that
USDA essentially had no capability to investigate civil rights
complaints. This development was not publicized, so plaintiffs,
putative class members and other minorities continued in good faith to
file discrimination complaints not knowing that the investigative
staffs had been disbanded and that the complaints were ignored. This
constituted a willful failure by USDA to investigate discrimination in
violation of the 1964 Civil Rights Act and the ECOA that continued at
least until the mid-1990s.
85. USDA's refusal to eliminate discrimination from the
administration of its programs and its unwillingness to recognize and
endorse the civil rights of Hispanic and other minority farmers have
been widely known, discussed and condemned at least since the mid-
1960s. Detailed findings demonstrating the pervasiveness of the abuses
and the immediate need for meaningful reform are contained in internal
reports by USDA's CRAT and a series of subsequent progress reports by
USDA's Office of Inspector General to then Secretary Glickman and
issued in 1997, and reports by GAO, the Civil Rights Commission and
various congressional oversight committees.
86. USDA's blatant disregard of the requirements of ECOA and the
1964 Civil Rights Act--particularly the effective dismantling of the
OCR--prompted Congress to enact special legislation in 1998 ( 741 of
the Omnibus Consolidated Appropriation's Act for Fiscal Year 1999)
which waived, inter alia, the ECOA's statute of limitations applicable
to claims regarding farm credit arising between January 1, 1981 and
December 31, 1996.
87. USDA has codified regulations, 7 CFR Part 15--
``Nondiscrimination,'' which state USDA's ostensible policy of
nondiscrimination in federally assisted and conducted programs in
compliance with Title VI of the Civil Rights Act of 1964. The
regulations should have served as a basis for civil rights compliance
and enforcement with respect to participants in FSA programs; however,
USDA admitted that the regulations have long been outdated and never
accurately reflected the Department's agencies, programs and laws. See
OIG Report at 5.
88. The February 27, 1997 OIG Report addressed complaints of
discrimination within FSA as well as ten other USDA agencies. OIG
found, inter alia, that the FSA's discrimination complaint process
lacked integrity and accountability, had no effective tracking system,
had no process for reconciliation, was in disorder, failed to resolve
discrimination complaints, and had a massive backlog. OIG found that
the FSA staff responsible for processing the discrimination complaints
consisted of two untrained and unqualified people. Hundreds of
unresolved complaints were over a decade old. OIG found no management
oversight within FSA with respect to the handling of civil rights
complaints.
89. At the same time that OIG released its report, the USDA CRAT
Report was released, condemning USDA's lack of civil rights enforcement
and accountability as a cause of the drastic decline in the number of
minority farmers.
90. In the CRAT Report, the USDA described the pattern and practice
of disparate treatment experienced by minority and limited resource
farmers applying to USDA for loans:
The minority or limited-resource farmer tries to apply for a
farm-operating loan through the FSA county office well in
advance of planting season. The FSA county office might claim
to have no applications available and ask the farmer to return
later. Upon returning the farmer might receive an application
without any assistance in completing it, then be asked
repeatedly to correct mistakes or complete oversight in the
loan application. Often those requests for correcting the
application could be stretched for months, since they would
come only if the minority farmer contacted the office to check
``on the loan processing.'' By the time processing is
completed, even when the loan is approved, planting season has
already passed and the farmer either has not been able to plant
at all, or has obtained limited credit on the strength of an
expected FSA loan to plant a small crop, usually without the
fertilizer and other supplies necessary for the best yields.
The farmer's profit is then reduced. CRAT Report at 15
(emphasis added).
91. USDA admitted in the CRAT Report that (a) discrimination
complaints at USDA were often ignored, and
(a) that farmers reported that even when there was a finding of
discrimination, USDA refused to pay damages. CRAT Report at
22-23;
(b) its record keeping on discrimination complaints was ``non-
existent,'' that a backlog existed, and that the largest
number of complaints against a single USDA sub-agency was
against FSA. CRAT Report at 24-25; and
(c) a lack of diversity in FSA county offices combined with a lack
of outreach to small and limited-resource farmers to
directly and adversely affects that participation of
Hispanics and other minorities in USDA programs (CRAT
Report at 26-27), as well as program delivery to minorities
and women. CRAT Report at 45.
92. USDA admitted that cultural insensitivity interferes with
Hispanic participation:
Customers at the recent listening sessions reiterated the
special needs of different minority and socially disadvantaged
communities. All communities agreed that they are overlooked
when information is released about available USDA programs.
USDA agencies do not make use of minority community
organizational and media outlets to be sure all eligible
participants know about their programs. Cultural barriers
prevent the communication necessary for good service by USDA
programs.
Young men and women who want to follow in the family
footsteps, either by taking over the family farm or by buying
their own, oftentimes find it difficult to obtain financing for
their ventures. According to several speakers at the listening
sessions, FSA has denied loans to new or beginning farmers
despite years of working on their family farm or receiving
advanced degrees in agriculture. CRAT Report at 27.
93. In sum, USDA admitted that USDA does not support or enforce
civil rights:
USDA does not have the structure in place to support an
effective civil rights program. The Assistant Secretary for
Administration lacks authority and resources essential to
ensure accountability among senior management ranks. There has
been instability and lack of skilled leadership at the position
of USDA Director of Civil Rights. Dividing up the Department's
Civil Rights office between policy and complaints has further
exacerbated the problem. The division of responsibility for
civil rights among different USDA offices and agencies has left
confusion over enforcement responsibilities. Finally, OGC is
perceived as unsupportive of civil rights. CRAT Report at 56.
94. On September 29, 1997, USDA's Office of Inspector General
(``OIG'') issued Phase II of the OIG Report on Civil Rights Issues,
entitled ``Minority Participation In Farm Service Agency's Farm Loan
Programs--Phase II'' (``OIG Report II''), which found, inter alia, that
(a) USDA had resolved only 32 of the 241 outstanding discrimination
complaints reported in the OIG Report (back in February 1997) and (b)
the backlog of discrimination complaints had increased from 241 to 474
for FSA and from 530 to 984 for all of USDA.
95. On September 30, 1998, the USDA's Office of Inspector General
released its ``Report to the Secretary on Civil Rights Issues--Phase
V'' (``OIG Report V'') which found that significant problems within OCR
persisted. It found, inter alia:
a. The Department through [OCR], has not made significant progress
in reducing the complaints backlog. Whereas the backlog
stood at 1,088 complaints on November 1, 1997, it still
remains at 616 complaints as of September 11, 1998. OIG
Report V, cover letter to Secretary.
b. The backlog is not being resolved at a faster rate because [OCR]
itself has not attained the efficiency it needs to
systematically reduce the caseload. Few of the deficiencies
we noted in our previous reviews have been corrected. The
office is still in disarray, providing no decisive
leadership and making little attempt to correct the
mistakes of the past. We note with considerable concern
that after 20 months [OCR] has made virtually no progress
in implementing the corrective actions we thought essential
to the viability of its operations. OIG Report V at i
(emphasis added).
c. Most conspicuous among the uncorrected problems is the continuing
disorder within [OCR]. The database [OCR] uses to report
the status of cases is unreliable and full of errors, and
the files it keeps to store needed documentation are
slovenly and unmanaged. Forty complaint files could not be
found, and another 130 complaints that were listed in USDA
agency files were not recorded in [OCR]'s database.
Management controls were so poor that we could not render
an opinion on the quality of CR's investigations and
adjudications. OIG Report V at iii (emphasis added).
d. Of equal significance is the absence of written policy and
procedures. OIG Report V at iii.
e. The absence of formal procedures and accurate recording raises
questions about due care within the complaints resolution
process. We found critical quality control steps missing at
every stage of the process. Staff members with little
training and less experience were put to judging matters
that carry serious legal and moral implications. Many of
[OCR]'s adjudicators, who must determine whether
discrimination occurred, were student interns. Legal staff
members with the Office of General Council (``OGC''), who
review [OCR]'s decisions for legal sufficiency, have had to
return over half of them because they were based on
incomplete data or faulty analysis. We noted that a
disproportionately large percent of the 616 cases of
unresolved backlog had bottlenecked in the adjudication
unit. OIG Report V at iii (emphasis added).
96. Upon information and belief, this systemic pattern of
ineffectiveness has continued. As reported on March 10, 2000, OIG
Report VII stated:
a. This is our seventh attempt to provide CR with constructive ways
to overcome its inefficiencies. Based on the results of our
review and on the operating environment we observed at
[OCR], we cannot report encouraging news. OIG Report VII.
Viadero cover letter at 1 (emphasis is original).
b. Based on the findings of our current review on [OCR]'s poor
record of responding to our past recommendations, it is
difficult to recognize any significant level of progress.
Unless [OCR] implements a management plan that addresses
effective leadership, changing organizational culture,
customer focus, and process re-engineering, we question
whether future complaints of discrimination in the
distribution of program benefits will receive due care. OIG
Report VII, Viadero cover letter at 1-2.
c. Many other critical issues remain unresolved. Most notably, [OCR]
did not re-engineer its complaints resolution process.
Although, [OCR] officials had previously agreed that the
system they used to process complaints was neither
effective nor efficient and although we recommended a major
transformation of this system, no significant changes in
how complaints are processed have been made. As a result,
we cannot conclude that all complaints are processed with
due care. OIG Report VII at i (emphasis in original).
d. Since February 1997, we have issued six reports on civil rights
issues relating to the program complaints process
administered by CR. Those six reports contained 67
recommendations, 54 of which were directed at CR (the
remaining 13 were directed at the Farm Service Agency).
During the current review, we found that 41 recommendations
(all directed at [OCR]) have not been adequately addressed
by [OCR], based on the actions taken as of December 1,
1999. As a result, we still have concerns that [OCR] may
not be providing due care when processing complaints
alleging discrimination in USDA programs. OIG Report VII at
14.
97. Upon information and belief, the systematic pattern of
ineffectiveness is still affecting USDA today. Among other things, in
its February 2003 report, the EEOC found that:
a. sub-components to USDA's OCR `` `what they want to do' because
they have no accountability to [OCR]'', EEOC Report at 9;
b. OCR does not investigate complaints of discrimination within the
regulatory time period. Data supplied by USDA indicates
that it takes OCR on average 594 days to complete an EEO
investigation. The EEOC regulations require such an
investigation to be completed within 180 days, unless the
complainant agrees to an extension of time in writing, for
a maximum of 270 days. Id. at 16-17;
c. OCR does not have an effective EEO complaint tracking system and
process. Id. at 18;
d. data entered into the system is unverified and unreliable. Id. at
20; and
OCR's current interpretation of what is a complaint and when it
is officially received undercounts the actual number of
complaints being made to OCR and provides a distorted
picture of complaint activity. Id.
98. In sum, USDA's willful disregard of, and failure to properly
investigate, discrimination complaints from Hispanics farmers began
with the disbanding of civil rights enforcement functions in 1983.
Furthermore, even after February 1997, when the enforcement staff of
the OCR was formally reestablished, USDA has failed to afford
meaningful investigation and review of discrimination complaints.
Finally, USDA continues to turn a blind eye toward the discrimination
against Hispanic farmers in the administration of USDA farm loan and
benefit programs which still persists in many local areas which contain
large numbers of Hispanics.
VII. Statute of Limitations Is Waived
99. On October 21, 1998, President Clinton signed into law the
Omnibus Consolidated Appropriations Act for Fiscal Year 1999, P.L. 105-
277, Div. A, 101(a) [ 741], 112 Stat. 2681 (codified at 7 U.S.C.
2279, Note). Said legislation waives the statute of limitations for
plaintiffs in this case. In connection with claims arising from acts of
discrimination by USDA in its administration of the farm loan and
disaster assistance programs which occurred between January 1, 1981 and
December 31, 1996.
100. In addition, other ostensible applicable statutes of
limitations applicable to various putative class members are tolled
because the failure of such plaintiffs to file timely complaints was
caused by actions or inactions caused by USDA of which plaintiffs were
unaware owing to defendant's conduct.
101. Finally, as to acts of discrimination suffered by plaintiffs
from October 13, 1998 and beyond the date of the filing of this
complaint, there is no statute of limitations issue.
VIII. Class Action Allegations
102. Plaintiffs generally bring this class action on behalf of
Hispanics who farmed or ranched, or attempted to farm or ranch, during
the period January 1, 1981 to the present and who were discriminated
against by the USDA on the basis of national origin when they sought to
participate on equal terms in farm loan and disaster benefit programs
and who complained to USDA about such discrimination. The predominant
purpose in doing so is to achieve definitive and lasting reform of the
USDA policies, procedures and practices which permitted this
discrimination to occur and endure for so many years, to the end that
the transparency and resulting accountability essential to such reform
be achieved. A secondary, but important, purpose is to establish a fair
and equitable method of permitting recovery of monetary damages
suffered as a consequence of such discrimination to the maximum extent
feasible.
103. The discrimination practiced against plaintiffs occurred at
various stages in the process by which USDA administered its farm loan
and non-credit benefit programs. Consequently, there are several
distinct groups of plaintiffs differentiated by the particular stage of
the process where they experienced discrimination, to wit:
a. Subclass A--those Hispanics whom defendant sought to
discourage from availing themselves of USDA farm loan or non-
credit benefit programs by refusing to provide either an
application form or assistance in completing the application
and pursuing the application process[.]
b. Subclass B--those Hispanics whom defendant sought to
discourage from availing themselves of USDA farm loan or non-
credit benefit programs by protracted delays in the processing
of their applications and the funding of approval loans.
c. Subclass C--those Hispanics whom defendant sought to
discourage from availing themselves of the USDA farm loan and
non-credit benefit programs by the use of highly subjective
criteria to reject their applications.
d. Subclass D--those Hispanics whom defendant sought to
discourage from availing themselves of the USDA farm loan or
non-credit benefit programs by subjecting Hispanic farmers to
supervised bank accounts[.]
e. Subclass E--those Hispanic farmers whom defendant sought
to discourage from availing themselves of farm credit or non-
credit benefit programs by delaying or denying loan servicing.
104. This action is brought and may be properly maintained as a
class action pursuant to the provisions of Federal Rules of Civil
Procedure 23(a)(1)-(4) and, as appropriate, 23(b)(1), (b)(2) and, or
(b)(3). This action satisfies the numerosity, commonality, typicality,
adequacy and predominance and superiority requirements of those
provisions.
105. The class is so numerous that individual joinder of all the
members is impractical and that compelling each plaintiff to institute
and pursue a separate action to secure the remedial relief essential to
the eradication of systemic, pervasive discrimination practiced against
each, and/or to recover monetary damages as compensation for the
economic harm caused by discrimination, is both impractical and a
needless burden on the courts. The number of Hispanic farmers in the
United States in 2002, the date of the last published Agricultural
Census, is approximately 50,592, for all of whom securing remedial
relief is essential.
106. Common questions of law and fact exist as to all members of
the class, whether viewed as a Rule 23(b)(2) or (b)(3) class, and
predominate over any questions affecting only individual members of the
class. These common legal and factual questions spring from a central
undisputed and overriding reality that for decades the USDA knowingly
tolerated the existence of pervasive discrimination in the
administration of its farm loan and disaster benefit programs created
by a highly decentralized, localized system of county committees who
were free to act on a wholly subjective basis with no meaningful
supervision from senior management of USDA. This core factual reality
does not vary from class member to class member and may be established
without reference to individual circumstances of any particular class
member. Consequently, the general combination of wholly subjective
decision making by local officials reflecting the prevailing prejudices
of each locale, and the lack of oversight by USDA produced a pattern
and practice of discrimination in areas which Hispanic farmers were
concentrated, and this pattern and practice were perpetuated for years
in violation of law.
107. Additional common questions include:
(a) Did USDA attempt to deny Hispanics farm credit and loan
servicing in violation of the ECOA?
(b) Did USDA seek to deny Hispanic farmers access to noncredit farm
benefit programs?
(c) Did USDA attempt to discourage Hispanics from availing
themselves of farm credit and loan servicing in violation
of the ECOA, Regulation B promulgated pursuant thereto, and
USDA's own regulations with respect to farm credit?
(d) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by denying them
applications and assistance in completing applications?
(e) Did defendant's attempts to discourage Hispanic farmers from
availing themselves of farm credit by denying them
applications and assistance in completing applications
violate the ECOA, Regulation B promulgated pursuant thereto
and USDA's own regulations?
(f) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by delaying the
processing of their loan applications?
(g) Did defendant's attempts to discourage Hispanic farmers from
availing themselves of farm credit by delaying the
processing of their loan applications violate the ECOA,
Regulation B promulgated pursuant thereto and USDA's own
regulations?
(h) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by using highly
subjective criteria to reject their loan applications?
(i) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by using highly
subjective criteria to reject their loan applications
violate the ECOA, Regulation B promulgated pursuant thereto
and USDA's own regulations?
(j) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by subjecting them to
supervised bank accounts?
(k) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by subjecting them to
supervised bank accounts violate the ECOA, Regulation B
promulgated pursuant thereto and USDA's own regulations?
(l) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by delaying or denying
loan servicing?
(m) Did defendant attempt to discourage Hispanic farmers from
availing themselves of farm credit by delaying or denying
loan servicing violate the ECOA, Regulation B promulgated
pursuant thereto and USDA's own regulations?
(n) Did defendant fail to investigate or to process discrimination
complaints made by Hispanic farmers?
(o) Did defendant's failure to investigate or to process Hispanic
farmers' civil rights complaints violate the ECOA?
108. Plaintiffs' claims are typical of the claims of the members of
the class, all of whom, by virtue of USDA's arbitrary and unlawful
actions, have been denied equal access to loans or loan servicing, and
to non-credit benefit programs, and were denied due process in the
enforcement of their discrimination complaints, and have been subject
to USDA's institutional and systematic failure to enforce the civil
rights laws intended to benefit plaintiffs and members of the class.
109. Plaintiffs are adequate representatives of the class because
they are members of the class and their interests do not conflict with
the interests of the members of the class they seek to represent. The
named plaintiffs' claims are consistent with the claims of other class
members. Plaintiffs' counsel are experienced class action lawyers who
will adequately represent the class.
110. A class action is superior to other available methods for the
fair and efficient adjudication of this litigation since individual
litigation of class members' claims regarding USDA's institutional and
systematic deprivation of their civil rights as described in this
Complaint is impracticable. Even if any class members could afford to
litigate, it would be unduly burdensome to the courts to litigate each
individual case. Individual litigation further presents a potential for
inconsistent or contradictory judgments and increases the delay and
expenses to all parties and the court system in resolving the legal and
factual issues of the case. By contrast, the class action device
presents far fewer management difficulties and provides the benefits of
single adjudication of what essentially is one problem, economies of
scale, and comprehensive supervision by a single court. Notice of the
pendency of any resolution of this class action can be provided to
class members by publication and broadcast; in addition, each class
member's farm number, address, application date and payment results is
readily available to defendants.
Count I
(Declaratory Judgment)
111. Plaintiffs, on behalf of themselves and all others similarly
situated, re-allege all paragraphs above as if fully set forth herein.
112. An actual controversy exists between plaintiffs and class
members and defendant as to their rights with respect to defendant's
farm loan and non-credit benefit programs.
113. Plaintiffs and the class members pray that this Court declare
and determine, pursuant to 28 U.S.C. 2201, the rights of plaintiffs
and class members under defendant's farm programs including their right
to equal credit, and to equal participation in farm loans and disaster
benefit programs, and their right to full and timely enforcement of
national origin discrimination complaints.
Count II
(Violation of Equal Credit Opportunity Act)
114. Plaintiffs, on behalf of themselves and all others similarly
situated, re-allege all paragraphs above as if fully set forth herein.
115. USDA's acts of denying plaintiffs and class members
applications for loans and requests for loan servicing, delaying the
processing of their applications, rejecting applications on highly
subjective eligible criteria, subjecting them to SBAs, denying or
delaying loan servicing, and systematically failing to properly process
or to investigate their discrimination complaints was discrimination on
the basis of national origin and, was contrary to the requirement of
the Equal Credit Opportunity Act, 15 U.S.C. 1691(a).
Count III
(Violation of Administrative Procedure Act)
116. Plaintiffs, on behalf of themselves and all others similarly
situated, re-allege all paragraphs above as if fully set forth herein.
117. USDA's acts of denying plaintiffs and class members equal
access to non-credit benefit programs and of systematically failing to
properly investigate and/or process their discrimination complaints
were contrary to the requirements of the Administrative Procedure Act,
5 U.S.C. 701, et seq.
Prayer for Relief
Wherefore plaintiffs respectfully request this Court to:
1. declare that the practices, policies, patterns, and
procedures described in this Complaint exist at the USDA and
that they are unlawful;
2. issue a permanent injunction prohibiting the defendant,
the USDA, its officers, agents, employees and successors from
engaging in discrimination in the administration of USDA farm
loan and non-credit benefit programs as alleged herein,
including but not limited to:
(a) refusing to provide applications to, deterring,
or otherwise attempting to deter or discourage Hispanic
farmers from applying for farm loans and non-credit
benefits;
(b) applying more stringent underwriting standards or
otherwise discriminatorily denying loans to Hispanic
farmers who otherwise were qualified;
(c) providing inadequate or less assistance to
Hispanic farmers in completing farm loan applications
and/or farm and home plans and in applying for non-
credit benefits;
(d) granting loans to Hispanic farmers and ranchers
on differential and less advantageous terms than
similarly situated white male farmers; and
(e) discriminatorily denying Hispanic farmers and
ranchers servicing on their loans, or providing less
advantageous servicing to Hispanic farmers than that
offered to similarly situated white male farmers.
3. issue a permanent injunction requiring that the USDA adopt
lending practices in conformity with the requirements of the
Equal Credit Opportunity Act and the AdministrativeProcedure
Act;
4. issue an order mandating that USDA remedy its
discriminatory patterns and practices by:
(a) taking affirmative action to advertise in
appropriate media outlets designed to reach Hispanic
farmers that USDA encourages and welcomes Hispanic
farmers to avail themselves of all of the services
offered by USDA and that any action taken by any USDA
employee or representative that in any way makes
Hispanic farmers feel unwelcome or seeks to deter them
from availing themselves of all services provided by
USDA shall be reported to the Secretary via a toll free
800 number and fully investigated;
(b) adopting a system of providing a receipt for
service to all farmers and ranchers who visit local FSA
offices to inquire about, or to apply for, USDA farm
loans or noncredit benefits;
(c) requiring FSA personnel to provide full and equal
assistance to all farmers who request it without regard
to sex, race, national origin, marital status or any
other discriminatory basis proscribed by the ECOA;
(d) providing applications and explanations regarding
both the farm loan and disaster benefit programs in
Spanish;
(e) providing that those local FSA offices serving
areas with large numbers of Hispanic farmers and
ranchers employ persons both fluent in Spanish and
familiar with Hispanic culture to assist Hispanic
farmers and ranchers in applying for farm loan and non-
credit benefit programs and in securing appropriate
levels of servicing and other forms of assistance as
necessary;
(f) providing, for a period sufficient to ensure that
long standing discriminatory practices finally end, a
system by which Hispanic farmers and ranchers who are
or have been aggrieved by conduct at local FSA offices
have an opportunity for an expedited review via
independent mediators; and
(g) providing that those state and local FSA offices
servicing Hispanic farmers and ranchers provide semi-
annual reports to the Secretary detailing the
particulars of each application for farm loans and
disaster benefits by Hispanics and the disposition
thereof;
5. to require that USDA, under supervision of the Court,
promptly redesign its computerized data collection system as
regards its administration of farm loans and non-credit benefit
programs in order to ensure that full transparency is achieved
and to permanently enjoin defendant and her successors from
modifying the data collection system in any manner that has the
effect of reducing or in any way hindering the transparency of
the data collection system;
6. once the modernization of the data collection system as
described in 5 supra is accomplished, to require the Secretary
to issue public annual reports detailing the extent of Hispanic
participation in such programs;
7. to devise a method, consistent with avoiding undue burden
upon the Court and defendant and mindful of the public interest
in ensuring that fraud be avoided to the maximum extent
practicable, by which to award compensatory damages to
deserving plaintiffs;
8. award reasonable attorneys' fees and costs, including
expert fees, and interest; and
9. order such other and further relief, including but not
limited to such specific remedies, as the Court deems just and
proper.
Respectfully submitted,
Of Counsel: Alan M. Wiseman #187971
Kenneth C. Anderson #243962 Stephen S. Hill #927137
Robert L. Green, Jr. #935775 HOWREYLLP
HOWREYLLP 1299 Pennsylvania Ave., N.W.
1299 Pennsylvania Ave., N.W. Washington, D.C. 20004
Washington, D.C. 20004 (202) 783-0800
(202) 783-0800 (202) 383-6610--Fax
(202) 383-6610 Alexander J. Pires, Jr. #185009
Conlon, Frantz, Phelan & Pires, LLP
1818 N Street, N.W.
Suite 700
Washington, D.C. 20036
(202) 331-7050
(202) 331-9306--Fax
Philip Fraas #211219
3050 K Street, N.W.
Suite 400
Washington, D.C. 20007
(202) 342-8864
(202) 342-8451--Fax
Attorneys for Plaintiffs
Guadalupe L. Garcia, Jr., et al.
Date: June 28, 2006
______
Submitted Report by Hon. Ann Kirkpatrick, a Representative in Congress
from Arizona
Indian Issues: Agricultural Credit Needs and Barriers to Lending on
Tribal Lands
May 2019
GAO-19-464
GAO Highlights
Highlights of GAO-19-464, a report to congressional
committees.
Why GAO Did This Study
About 46 million of the 56 million acres of the land that the
Federal Government holds in trust for the benefit of Indian Tribes and
their members has an agricultural purpose. However, Tribal agriculture
and economic development experts have noted that Indian Tribes and
their members may need improved access to agricultural credit.
Congress included a provision in statute for GAO to review the
ability of FCS to meet the agricultural credit needs of Indian Tribes
and their members on Tribal lands. This report describes (1) what is
known about the agricultural credit needs of Indian Tribes and their
members, (2) barriers stakeholders identified to agricultural credit on
Tribal lands, (3) FCS authority and actions to meet those agricultural
credit needs, and (4) stakeholder suggestions for improving Indians'
access to agricultural credit on Tribal lands.
GAO explored potential data sources on Indians' agricultural credit
needs, conducted a literature review, and reviewed statutes and
regulations governing Tribal lands and FCS. GAO also reviewed the
marketing plans and written responses of a nongeneralizable sample of
11 FCS associations whose territories included Tribal lands with high
levels of agricultural activity. GAO interviewed stakeholders from a
sample of seven Tribes (generally selected based on Tribal region and
agricultural activity), experts in Tribal agriculture and economic
development (selected based on relevant publications, Congressional
testimonies, and others' recommendations), and representatives from FCS
and its regulator, the Farm Credit Administration, and other relevant
government agencies.
View GAO-19-464.* For more information, contact Alicia Puente
Cackley at (202) 512-8678 or [email protected].
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* https://www.gao.gov/products/GAO-19-464.
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What GAO Found
Limited data are available on the needs of Indian Tribes and their
members for agricultural credit, such as operating or equipment loans,
to develop and expand agricultural businesses on Tribal lands. Federal
regulations have generally prohibited lenders from inquiring about the
personal characteristics, such as race, of applicants on nonresidential
loans. Some Tribal stakeholders and experts said that Tribal members
may not have applied for agricultural credit because they heard of
other Tribal members being denied loans. They said that Tribal members
likely obtain agricultural credit from Department of Agriculture
programs or Tribal lenders. Another potential source of agricultural
credit is the Farm Credit System (FCS), a government-sponsored
enterprise that includes 69 associations that lend to farmers and
ranchers.
Tribal stakeholders and experts reported a general lack of
commercial credit on Tribal lands due to the following factors:
Land use restrictions. Most Tribal lands only can be used as
loan collateral in certain circumstances or with Federal
permission.
Administrative process delays. Tribal members reported often
encountering delays obtaining necessary Federal loan documents.
Legal challenges. Lenders reported concerns about their
ability to recover loan collateral due to the unique legal
status of Tribes.
Loan readiness. Tribal members may have no or poor credit
histories and be unfamiliar with the paperwork required for an
agricultural loan, such as a business plan.
FCS is authorized to provide a range of credit services to eligible
agricultural producers, which may include Indian Tribes, Tribal
businesses, and Tribal members. FCS associations must obtain land as
collateral for long-term real estate loans, but are not required to do
so for shorter-term loans, such as for operating costs or equipment
purchases. Some FCS associations GAO contacted reported making loans to
Indian Tribes or their members. In a sample of 11 FCS associations with
Tribal lands in their territory, eight said they have loaned to Tribes
or their members in the past 2 years. GAO's review of these 11
associations' marketing plans and written responses to GAO follow-up
questions found that seven noted outreach--such as support for
agricultural education activities--targeted to Tribes and their
members. The other four reported broad and general outreach efforts
that also included minority groups.
To improve access to agricultural credit on Tribal lands,
stakeholders discussed several options. For example, some stakeholders
discussed the potential for partnerships between commercial or
government lenders and Tribal lenders (such as Native Community
Development Financial Institutions) and increased use of loan
guarantees. Some stakeholders also discussed actions Tribes could take
to ease barriers to lending, such as adopting their own leasing
procedures to reduce administrative processing time with Federal
agencies for certain loans.
Contents
Letter
Background
Limited Data Are Available on Agricultural Credit Needs of Indian
Tribes and Their Members
Stakeholders Reported That Tribes and Their Members Face Multiple
Barriers to Obtaining Agricultural Credit on Tribal Lands
FCS Laws Allow for Lending on Tribal Lands, and Some FCS
Associations Reported Lending to Tribes or Tribal Members
Stakeholders Discussed Lender Partnerships, Loan Guarantees, and
Other Options to Improve Agricultural Credit Access on Tribal Lands
Agency Comments 30
Appendix I Objectives, Scope, and Methodology
Appendix II GAO Contact and Staff Acknowledgments
Tables
Table 1: Tribal Land Types and Definitions
Table 2: Agricultural Activity on 76 Selected Indian Reservations,
by Primary Farm or Ranch Operator (2012)
Abbreviations
BIA Bureau of Indian Affairs
FCA Farm Credit Administration
FCS Farm Credit System
HEARTH Act Helping Expedite and Advance
Responsible Tribal Home Ownership
Act of 2012
Interior Department of the Interior
Native CDFI Native Community Development
Financial Institution
USDA Department of Agriculture
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if you wish to reproduce this material separately.
May 9, 2019
Hon. Pat Roberts,
Chairman;
Hon. Debbie Stabenow,
Ranking Minority Member,
Committee on Agriculture, Nutrition, and Forestry,
United States Senate;
Hon. Collin C. Peterson,
Chairman;
Hon. K. Michael Conaway,
Ranking Minority Member,
Committee on Agriculture,
House of Representatives;
Hon. Raul M. Grijalva,
Chairman;
Hon. Rob Bishop,
Ranking Minority Member,
Committee on Natural Resources,
House of Representatives.
Approximately 46 million acres of the 56 million acres the Federal
Government holds in trust for the benefit of Indian Tribes and their
members has an agricultural purpose, according to the Department of the
Interior's (Interior) Bureau of Indian Affairs (BIA).\1\ Agricultural
activity on Tribal lands can include farming, ranching, aquaculture,
and other agribusinesses.\2\ Tribal agriculture and economic
development experts have noted that Indian Tribes and their members may
need improved access to agricultural credit, such as operating or
equipment loans, to develop and expand agricultural businesses on
Tribal lands. One source of agricultural credit is the Farm Credit
System (FCS), a national network of customer-owned lending
institutions.
---------------------------------------------------------------------------
\1\ See Bureau of Indian Affairs, ``Branch of Agriculture and
Rangeland Development,'' accessed on April 18, 2019. https://
www.bia.gov/bia/ots/division-natural-resources/branch-agriculture-and-
rangeland-development. BIA officials told us that tracts with
agricultural utilization also may have coinciding land uses that do not
prohibit or interfere with agriculture purposes. Individuals and Tribes
decide how to use their respective lands and report those decisions to
BIA.
\2\ For purposes of this report, ``Tribal lands'' refers to
reservations (including all land within the reservations' boundaries),
trust land, allotments, and restricted fee land. We discuss the types
of Tribal lands in more detail later in the Background. Also see
appendix I.
---------------------------------------------------------------------------
The Agricultural Improvement Act of 2018 included a provision for
us to study the agricultural credit needs of Indian Tribes and their
members on Tribal lands, and FCS institutions' authority and resources
to meet those needs. This report describes (1) what is known about the
agricultural credit needs of Indian Tribes and their members on Tribal
lands, (2) the barriers stakeholders and experts identified that Indian
Tribes and their members on Tribal lands face in obtaining agricultural
credit to meet their needs, (3) FCS's lending authority and lending and
outreach activities on Tribal land, and (4) suggestions stakeholders
have discussed to improve access to agricultural credit on Tribal
lands.
To address all the objectives, we reviewed relevant Federal
statutes, regulations, and other legal documentation. We interviewed
officials from the Farm Credit Administration (FCA), BIA, the
Department of Agriculture (USDA), and FCS's trade association, the Farm
Credit Council. We interviewed experts on Tribal agriculture and
economic development from advocacy groups and academia, selected based
on relevant publications, testimonies before Congress, or
recommendations from other experts in these fields. Throughout this
report, we refer to them as experts.
We also interviewed stakeholders associated with seven selected
Tribes.\3\ We first selected six Tribes from locations in different
regions (Great Plains, Rocky Mountain, Northwest, Southwest) and one
state (Oklahoma). Within these regions, the selected Tribes were those
with generally large Tribal land areas with high levels of agricultural
activity, as indicated by the USDA 2012 Census of Agriculture data.\4\
Four of the six Tribes we contacted to request interviews provided us
with various contacts. As a result, for four Tribes, we interviewed
Tribal agriculture department employees, Tribal farm employees, or
representatives of the Native Community Development Financial
Institution (Native CDFI) serving the Tribe.\5\ We then selected three
additional Tribes based on USDA data or recommendations from experts we
interviewed.\6\ For these three Tribes, we interviewed employees of
Tribal farms or representatives of Native CDFIs or community
development corporations. Throughout this report, we refer to Tribal
government employees, Tribal farm employees, or representatives of
Native CDFIs or community development corporations serving a Tribe as
Tribal stakeholders. Although the information we obtained from the
Tribal agriculture department employees allowed us to provide anecdotal
Tribal perspectives, it is not generalizable to the 573 federally
recognized Indian Tribes. The views of Tribal farm employees and Native
CDFI and community development corporation representatives also cannot
be generalized to Tribes but illustrate views on needs, barriers, and
other issues from the perspectives of the organizations.
---------------------------------------------------------------------------
\3\ Our report generally addresses the agricultural credit needs of
Tribes and their members in the lower 48 states. See appendix I.
\4\ Department of Agriculture, 2012 Census of Agriculture: American
Indian Reservations, Subject Series, Part 5, AC-12-S-5 (Washington,
D.C.: August 2014). This was the most recent available version of the
reservation data as of April 2019.
\5\ CDFIs expand economic opportunity in low-income communities by
providing access to financial products and services for local residents
and businesses. The Department of the Treasury's CDFI Fund has a Native
American CDFI Assistance Program that makes financial and technical
assistance awards to Native CDFIs (certified or certifiable CDFIs where
at least 50 percent of the activities serve Native Americans, Alaska
Natives, and/or Native Hawaiians). There were 68 certified Native CDFIs
as of February 2019, according to the CDFI Fund.
\6\ We contacted the additional three Tribes to supplement our
original sample. For more information, see appendix I.
---------------------------------------------------------------------------
To address the first objective on agricultural credit needs, we
also reviewed Federal data sources and Federal regulations related to
collecting data on loan applicants' personal characteristics for
nonresidential loans.
To supplement the limited data and provide additional information
for the second objective on barriers to obtaining agricultural credit,
we conducted a review of literature from government and academic
reports and identified additional materials through citations in
literature we reviewed.
To collect information for the third objective, we reviewed the
marketing plans of a nongeneralizable sample of 11 FCS associations
whose territories included large Tribal land areas with high levels of
agricultural activity. We also obtained written responses from the 11
associations to a series of questions we posed about their lending and
outreach to Tribes and their members and any challenges in making loans
involving Tribal lands. For more information on our scope and
methodology, see appendix I.
We conducted this performance audit from December 2018 to May 2019
in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
Background
Indian Tribes and Tribal Land Types
As of May 2019, the Federal Government recognized 573 Indian Tribes
as distinct, independent political communities with certain powers of
sovereignty and self-government, including power over their territory
and members. The Tribes can vary greatly in terms of their culture,
language, population size, land base, location, and economic status. As
of the 2010 U.S. Census, about 21 percent, or 1.1 million, of all
American Indians lived on Tribal lands.
Tribal lands include many land types (see table 1). According to
BIA, the Federal Government holds about 46 million acres in trust for
Tribes (Tribal trust land) and more than 10 million acres in trust for
individual Indians (individual trust land).\7\
---------------------------------------------------------------------------
\7\ The terms Native American and Indian generally refer to
American Indians. In this report, we use the term ``Indian'' unless
citing the work of others that uses ``Native American.''
Table 1: Tribal Land Types and Definitions
------------------------------------------------------------------------
Land type Description
------------------------------------------------------------------------
Trust The Federal Government holds legal title
but the beneficial interest remains with
the Indian Tribe or individual Indian.
Restricted fee An Indian Tribe or individual Indian holds
title to the land, but with legal
restrictions against alienation or
encumbrance (for example, the land cannot
be sold or conveyed without the approval
of the Secretary of the Interior).
Allotment Land owned by one or more individual
Indians as a result of Federal laws that
divided reservation lands and allotted
them to individual Tribal members.
Allotments can be individual trust land or
individual restricted fee land.
Reservation Land set aside by treaty, Federal law, or
Executive Order for the residence or use
of an Indian Tribe. The land within the
reservation may include a mixture of
Tribal trust land, individual trust land,
restricted fee land, allotments, and fee-
simple land. (Fee-simple land is owned
without restriction and can be alienated
or encumbered on the owner's initiative
unless it is owned by an Indian Tribe. It
is the most common type of private land
ownership in the United States.)
------------------------------------------------------------------------
Source: GAO analysis of Federal laws and regulations. D GAO-19-464.
Some Tribes also have reservations. According to BIA, there are
approximately 326 Indian land areas in the United States administered
as Federal Indian reservations (including reservations, pueblos,
rancherias, missions, villages, and communities). The land within the
reservation may include a mixture of Tribal trust land, individual
trust land, restricted fee land, allotments, and land without trust or
restricted status (that is, fee-simple land), which may be owned by
Tribes, individual Indians, or non-Indians.\8\
---------------------------------------------------------------------------
\8\ Beginning in the late 1880s, Federal laws were enacted that
divided some reservation lands among individual Tribal members. These
allotments were often only held in trust or subject to restrictions on
alienation for a limited period of time. Once the trust period and
restrictions ended, it was easier for land to be sold or pass out of
Indian ownership. In addition, surplus lands within the reservation
were sold to non-Indians. As a result, Indian land holdings in the
lower 48 states decreased from 138 million acres to 48 million acres
and non-Indians may own fee-simple land within a reservation's
boundaries. In 1934, the Indian Reorganization Act ended the practice
of allotting Indian reservations.
---------------------------------------------------------------------------
Agricultural Activity on Tribal Lands
Agricultural producers (farmers, ranchers, or producers or
harvesters of aquatic products) on Tribal lands can be individual
Tribal members, the Tribe itself, or non-Indians who lease the land
from the Tribe or Indian owner. According to USDA's 2012 Census of
Agriculture, about 75 percent of farms and ranches on 76 selected
Indian reservations were operated by agricultural producers that
identified as American Indian or Alaska Native (see table 2).\9\ On
these reservations, Indian producers held 61 percent of total farm and
ranch acreage. However, the total market value of agricultural products
sold from Indian-operated farms and ranches was just over \1/10\ of
that of non-Indian operated farms and ranches on the 76 selected
reservations.\10\
---------------------------------------------------------------------------
\9\ The Navajo Nation, which has the largest reservation in the
United States at 16 million acres, operates a large share of the total
Indian-operated farms and ranches. According to the 2012 Census of
Agriculture, there were 14,362 Indian-operated farms on the Navajo
reservation--approximately 80 percent of all Indian-operated farms and
ranches on the 76 reservations detailed in the Census.
\10\ All U.S. Census and USDA Census of Agriculture estimates in
this report are likely underestimates, as Indian populations
historically have been undercounted in census activities. In addition,
the reservation data from the Census of Agriculture only reflect 76 of
326 total reservations. According to USDA, it based its decisions about
which reservation data to publish on factors including approval of
Tribal officials, amount of agricultural activity, success of list
building, and respondent confidentiality.
Table 2: Agricultural Activity on 76 Selected Indian Reservations, by Primary Farm or Ranch Operator (2012)
----------------------------------------------------------------------------------------------------------------
Total share of
Total acreage Total share Total market market value
Total number Total share of farms and of acreage of value of of
of farms and of farms and ranches (in farms and agricultural agricultural
ranches ranches (%) acres) ranches (%) products sold products sold
(in $1,000s) a (%)
----------------------------------------------------------------------------------------------------------------
Indian-operated 17,948 75 28,560,057 61 361,145 10
Non-Indian operated 5,980 25 18,449,341 39 3,079,386 90
-------------------------------------------------------------------------------------------
Total............. 23,800 100 47,009,398 100 3,440,531 100
----------------------------------------------------------------------------------------------------------------
Source: GAO analysis of 2012 Department of Agriculture Census of Agriculture data. D GAO-19-464.
Notes: For the Census of Agriculture, the Department of Agriculture (USDA) primarily collected data through the
mail. However, to maximize coverage of American Indian and Alaska Native agricultural producers, USDA staff
obtained supplemental information from knowledgeable reservation officials. USDA adjustments for nonresponse,
misclassification, or other factors may result in a level of error related to its estimates.
a According to USDA officials, sales reported are for the entire farm, both on and off of the reservation.
Therefore, if a farm had a small piece of land on the reservation, the entire sales would be reported in these
values, even if little of the value was produced on reservation land.
In 2011, USDA, which operates several agricultural programs
targeted to traditionally underserved populations, settled a class
action lawsuit brought by Native American farmers and ranchers for $760
million (Keepseagle v. Vilsack).\11\ The lawsuit alleged that USDA
discriminated against Native Americans in its farm loan and farm loan
servicing programs. In 2018, $266 million of the remaining settlement
proceeds were used to establish the Native American Agriculture Fund.
The Fund will begin awarding grants in 2019 to fund the provision of
business assistance, agricultural education, technical support, and
advocacy services to Native American farmers and ranchers.
---------------------------------------------------------------------------
\11\ Civil Action No. 1:99CV03119 (D.D.C.).
---------------------------------------------------------------------------
Agricultural Credit and the Farm Credit System
Like other businesses, agricultural producers generally require
financing to acquire, maintain, or expand their farms, ranches, or
agribusinesses. Types of agricultural loans as categorized by their
purpose or maturity may vary by lender but generally include the
following: \12\
---------------------------------------------------------------------------
\12\ Paul N. Ellinger and Peter J. Barry, A Farmer's Guide to
Agricultural Credit (Urbana-Champaign, Ill.: The Center for Farm and
Rural Business Finance, University of Illinois), accessed April 5,
2019, http://www.farmdoc.illinois.edu/finance/FarmersGuidetoCredit
Body.htm.
Short-term loans. These loans are used for operating
expenses and match the length and anticipated production value
of the operating or production cycle. They are typically
---------------------------------------------------------------------------
secured by the product (crops or livestock).
Intermediate-term loans. These loans are typically used to
finance depreciable assets such as equipment, which serves as
the loan collateral. The loan terms usually range from 18
months to 10 years.
Long-term loans. These loans are used to acquire, construct,
and develop land and buildings with terms longer than 10 years.
They are secured by real estate and may be called real estate
loans.
Several types of lenders provide credit to U.S. agricultural
producers. According to USDA's Economic Research Service, in 2017, FCS
and commercial banks provided most agricultural credit in the United
States, with respective market shares of 40 and 41 percent. USDA's Farm
Service Agency--a lender that focuses on assistance to beginning and
underserved farmers and ranchers and also guarantees the repayment of
loans made by other lenders--provided three percent, and the remainder
was provided by individuals, life insurance companies, and other
lenders.\13\
---------------------------------------------------------------------------
\13\ Department of Agriculture, Economic Research Service, U.S. and
State-Level Farm Income and Wealth Statistics, accessed April 18, 2019,
https://www.ers.usda.gov/data-products/farm-income-and-wealth-
statistics/.
---------------------------------------------------------------------------
FCS is a government-sponsored enterprise, established in 1916 to
provide sound, adequate, and constructive credit to American farmers
and ranchers. FCS is regulated by FCA, an independent Federal agency.
FCS's statutory mission includes being responsive to the needs of
all types of creditworthy agricultural producers, and in particular,
young, beginning, and small farmers and ranchers.\14\ According to FCA,
FCS is not statutorily mandated to focus on providing financial
opportunities to any other group.
---------------------------------------------------------------------------
\14\ FCS associations are required to establish programs for
furnishing sound and constructive credit and related services to young,
beginning, and small farmers and ranchers. These programs must assure
that such credit and services are available in coordination with other
units of FCS serving the territory and with other governmental and
private sources of credit. 12 U.S.C. 2207(a).
---------------------------------------------------------------------------
FCS lends money to eligible agricultural producers primarily
through its 69 lending associations (FCS associations), which are
funded by its four banks (FCS banks).\15\ All are cooperatives, meaning
that FCS borrowers have ownership and control over the organizations.
As of 2017, FCS had approximately $259 billion in loans outstanding, of
which 46 percent were long-term real estate-based loans; 20 percent
were short- and intermediate-term loans (such as for farm equipment or
advance purchases of production inputs); and 16 percent were for
agribusiness activities, such as agricultural processing and
marketing.\16\
---------------------------------------------------------------------------
\15\ The scope of this report is limited to the FCS banks and FCS
associations (collectively, FCS institutions). In addition to the FCS
institutions, FCS includes the Federal Farm Credit Banks Funding
Corporation, a special-purpose entity that issues and markets debt
securities on behalf of FCS banks to raise loan funds. FCS also
includes the Federal Agricultural Mortgage Corporation (Farmer Mac),
which provides a secondary market for agricultural real estate loans,
government-guaranteed portions of certain loans, rural housing mortgage
loans, and eligible rural utility cooperative loans. Farmer Mac has no
liability for the debt of any other FCS institution, and the other FCS
institutions have no liability for Farmer Mac debt.
\16\ The rest of the loans were generally for other agriculture-
related purposes, such as rural housing or utilities, which are not
included in our scope. See Farm Credit Administration, 2017 Annual
Report on the Farm Credit System (McLean, Va.: October 2018).
---------------------------------------------------------------------------
FCS associations are not evaluated under the Community Reinvestment
Act, which requires certain Federal banking regulators to assess
whether financial institutions they supervise are meeting the credit
needs of the local communities. FCS receives certain tax exemptions at
the Federal, state, and local level.\17\
---------------------------------------------------------------------------
\17\ See, for example, 12 U.S.C. 2023, 2077, 2098, 2134.
---------------------------------------------------------------------------
Limited Data Are Available on Agricultural Credit Needs of Indian
Tribes and Their Members
Data on Agricultural Credit Needs for Tribes and Their Members Are
Limited
Little data exists on the credit needs of Tribes and their members.
One measure of unmet credit needs is the difference between the amount
applied for and the amount received. However, we could not determine
the amount of agricultural credit that Indian Tribes and their members
applied for or received. These data were limited in part because
Federal regulations historically have prohibited lenders from asking
about the race of applicants for nonresidential loans, including
agricultural loans.\18\
---------------------------------------------------------------------------
\18\ With limited exceptions, creditors may not inquire about the
race, color, religion, national origin, or sex of an applicant for a
credit transaction that is subject to the Equal Credit Opportunity Act.
12 CFR 1002.5(b). In 2010, the law was amended to require financial
institutions to collect information concerning credit applications made
by women-owned, minority-owned, and small businesses. The purpose of
the data collection is to facilitate enforcement of fair lending laws
and identify the business and community development needs of women-
owned, minority-owned, and small businesses. 15 U.S.C. 1691c-2.
However, in 2011, the Consumer Financial Protection Bureau advised
financial institutions that their obligations under the new provision
would not go into effect until implementing regulations were issued. As
of April 2019, the bureau has not issued implementing regulations. On a
separate note, in cases that did not involve lending, the U.S. Supreme
Court has ruled that membership in a federally recognized Indian Tribe
is a political, not a racial, classification.
---------------------------------------------------------------------------
Additionally, even if data were available, the unmet need could be
greater than that indicated by information on those who may have
applied for and did not receive credit. Four Tribal stakeholders and
experts told us that Tribal members may choose not to apply for
agricultural credit because they were directly discouraged by loan
officers, had problems completing paperwork, or had heard of other
Tribal members being denied loans.
Two Tribal agricultural experts told us that on some level, the
agricultural credit needs of Indian Tribes and their members are the
same as other agricultural producers' credit needs. In particular,
Tribal stakeholders and experts told us that the Tribal members need
short-term loans for operating expenses and intermediate-term loans for
equipment. One difference between the agricultural credit needs of
Tribal members and other producers is that Tribal members may have a
greater unmet need for long-term loans, which are typically secured by
real estate, because of difficulties in using Tribal lands as
collateral, as discussed later in this report.
Credit needs vary based on the type of operation or borrower.
Type of operation. Some Tribal stakeholders we interviewed
told us that members of their Tribes were more likely to
participate in ranching than farming, partly because farming
has higher start-up costs. For example, one Tribal agricultural
expert told us a rancher can start with a few head of cattle
and grow the herd over time, but a beginning farmer may need to
purchase equipment. Additionally, several Tribal stakeholders
told us that land on their reservations was more suitable for
ranching than farming.
Type of borrower. Some Tribes have agricultural businesses,
which have credit needs different from those of individual
Tribal members, according to experts and BIA officials we
interviewed. For example, they may be greater or more complex.
According to an expert and a Tribal stakeholder, established
agricultural businesses likely would be able to receive credit
from commercial lenders because they have more resources to
pledge as collateral or stronger credit histories.
Additionally, if a Tribe has other profitable businesses, it
likely will have less difficulty obtaining credit or financing
agriculture with those other resources than those without such
resources.
According to Tribal stakeholders, experts, and BIA officials we
interviewed, Tribal members who obtain agricultural credit likely
receive it from USDA's Farm Service Agency, other USDA programs, or
Native CDFIs. Some Tribal members receive agricultural credit from
local private lenders, but they are typically larger, more established
borrowers. One expert told us that Tribal members who are smaller or
beginning agricultural producers and cannot access commercial banks
instead may borrow money from family members. A 2017 report found that
Native business owners were less likely than other business owners to
obtain start-up capital from banks.\19\
---------------------------------------------------------------------------
\19\ Miriam Jorgensen and Randall K.Q. Akee, Access to Capital and
Credit in Native Communities: A Data Review (Tucson, Ariz.: Native
Nations Institute, 2017).
---------------------------------------------------------------------------
Some experts we interviewed cited Native CDFIs as growing providers
of agricultural credit to Tribal members. A 2014 survey of 41 Native
CDFIs--credit unions, community banks, and loan funds--found more than
40 percent provided credit and training to farmers and ranchers.\20\ In
total, these CDFIs made almost $6 million in agricultural loans
annually. However, Native CDFIs are limited in how much agricultural
credit they can provide. In the 2014 survey, 56 percent of the Native
CDFIs that made agricultural loans reported not having enough capital
for such loans, with a total unmet need of at least $3 million in the
previous year. One Native CDFI we interviewed said its agricultural
loans averaged about $100,000 per borrower, and another said its
operating loans were about $50,000-$75,000 and its intermediate-term
loans about $100,000.
---------------------------------------------------------------------------
\20\ First Nations Oweesta Corporation, Food Financing Efforts
2014: Native CDFI Support of Native Farmers & Ranchers (Longmont,
Colo.: 2014). The survey queried all 67 Native CDFIs that were
established at the time of the survey and 41 responded for a response
rate of 61 percent.
---------------------------------------------------------------------------
Stakeholders See Potential for Growth of Agricultural Activity on
Tribal Lands That Could Require Access to Credit
Selected literature we reviewed and interviews with some Tribal
stakeholders found that Tribes have a growing interest in agriculture,
motivated by concerns over Tribal members' access to food, health, and
employment opportunities.
Food access. A 2014 USDA study found that about 26 percent
of individuals in Tribal areas lived within 1 mile of a
supermarket, compared to about 59 percent of all Americans.\21\
---------------------------------------------------------------------------
\21\ Phillip Kaufman, et al., Measuring Access to Healthful,
Affordable Food in American Indian and Alaska Native Tribal Areas, EIB-
131 (Washington, D.C.: December 2014).
Health. According to the Centers for Disease Control and
Prevention, American Indians and Alaska Natives have higher
rates of obesity and diabetes than white Americans.\22\
---------------------------------------------------------------------------
\22\ Centers for Disease Control and Prevention, Summary Health
Statistics: National Health Interview Survey: 2017. Tables A4a and A-15
(Atlanta, Ga.: 2017). Data were only available for American Indians and
Alaska Natives as a combined group.
Employment. A 2014 Interior report found that, on average,
only about 50 percent of Native American adults in Tribal
statistical areas were employed either full or part-time.\23\
---------------------------------------------------------------------------
\23\ Department of the Interior, Office of the Assistant
Secretary--Indian Affairs, 2013 American Indian Population and Labor
Force Report (Washington, D.C.: Jan. 16, 2014). The report defined
``Tribal statistical areas'' as geographic areas identified by the
Census that define the boundaries of reservations or comparable Tribal
areas for the purposes of statistical data collection.
Two commissioned reports on Tribal agriculture say that Indian
Tribes' vast land base represents an untapped opportunity for Tribes to
increase agricultural production, including growing their own healthful
foods and economic development.\24\ But, as previously discussed, for
reservations featured in USDA's 2012 Census of Agriculture, non-Indian
producers received a large share of the agricultural revenue.
Additionally, the agricultural products grown on Tribal lands typically
do not feed Tribal members and instead are sold into the general
agriculture commodity system.
---------------------------------------------------------------------------
\24\ Echo Hawk Consulting, Feeding Ourselves: Food Access, Health
Disparities, and the Pathways to Healthy Native American Communities
(Longmont, Colo.: 2015) and First Nations Development Institute, Time
for the Harvest: Native Food Systems in Perspective (Longmont, Colo.:
February 2004).
---------------------------------------------------------------------------
Furthermore, these reports and experts we interviewed noted that
the growth of agriculture on Tribal lands could require access to
credit. For example, one Tribal agriculture expert told us some Tribes
are interested in transitioning to ``value-added'' agriculture, which
aims to help the community that produces raw agricultural materials
capture the value of the products as they progress through the food
supply chain (for example, by processing crops they grow or
transitioning to more profitable products, such as organic). Value-
added agriculture initiatives might require building facilities or
acquiring more expensive inputs, and Tribes likely would need financing
to support these initiatives. According to some experts and a study we
reviewed, if Tribes and their members cannot access affordable credit,
it could limit the growth of these initiatives.\25\
---------------------------------------------------------------------------
\25\ Echo Hawk Consulting.
---------------------------------------------------------------------------
Stakeholders Reported That Tribes and Their Members Face Multiple
Barriers to Obtaining Agricultural Credit on Tribal Lands
Tribes and their members face several barriers to obtaining
agricultural credit, including land tenure issues, administrative
challenges, lenders' legal concerns, and loan readiness issues. As a
result, there is limited commercial lending on Tribal lands.
Land Tenure Issues May Present Hurdles to Obtaining Agricultural Credit
Ten Tribal stakeholders and experts we interviewed cited
difficulties in using Tribal lands as collateral as a barrier to
obtaining credit because of Federal laws or other constraints.
Tribal trust and restricted fee lands. Federal law generally
prohibits lenders from obtaining an ownership interest in
Tribal trust and restricted fee lands. As a result, Tribes are
not able to use their 46 million acres of Tribal trust or
restricted fee lands as collateral for a loan. However, Tribes
can lease such lands to other parties, including a Tribal
business or Tribal member who wishes to use the land for
agricultural purposes (lessees). These lessees can then pledge
their ``leasehold interest'' in the lands as collateral for a
loan, but may face challenges in doing so.\26\ For example, in
general, leases of Tribal trust and restricted fee lands must
be approved by BIA and comply with its leasing regulations,
which stipulate that agricultural leases generally have a
maximum term of 10 years.\27\ While BIA generally allows leased
Tribal trust and restricted fee lands to be subject to a
leasehold mortgage, three Tribal stakeholders and experts we
interviewed said that BIA's maximum term for agricultural
leases often was insufficient for obtaining an agricultural
loan.\28\
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\26\ The lessee must obtain approval of the Secretary of the
Interior to pledge a leasehold interest as collateral. When a borrower
uses a leasehold interest as collateral, upon default, the lender has
the right to exercise control over the land for the remaining term of
the underlying lease.
\27\ An agricultural lease may have a term of up to 25 years if
substantial investment in the improvement of the land is required.
However, some Tribes may have statutory authority to enter into
agricultural leases for longer than 10 or 25 years. In addition, the
Helping Expedite and Advance Responsible Tribal Home Ownership Act of
2012 (HEARTH Act) authorizes Tribes to develop their own agricultural
leasing regulations and, once those regulations are approved by the
Secretary of the Interior, to issue agricultural leases of their trust
and restricted fee lands without BIA approval. Under the HEARTH Act,
Tribes may issue agricultural leases of Tribal trust and restricted fee
lands for a term of 25 years with up to two renewal terms of 25 years
each. The HEARTH Act does not authorize Tribes to assume responsibility
for leasing individual trust and restricted fee lands. Pub. L. No. 112-
151, 2,126 Stat. 1150, 1151 (2012) (codified at 25 U.S.C. 415(h)).
Tribes also may be able to lease their trust and restricted fee land
without Interior approval pursuant to other statutory authority.
\28\ In general, lenders require that the term of the lease be
longer than the term of the loan. Therefore, a 10 year lease would not
be sufficient collateral for most long-term real estate loans, which
have terms longer than 10 years.
Individual trust and restricted fee lands. Unlike Tribal
trust and restricted fee lands, the owners of individual trust
and restricted fee lands can use these lands as collateral for
a loan with permission of the Secretary of the Interior.\29\
However, many tracts of individual trust and restricted fee
lands are allotments with fractionated ownership. According to
nine Tribal stakeholders and experts we interviewed,
fractionated land is a barrier to agricultural activity and
obtaining credit. Fractionated land occurs when an allottee
dies without a will and ownership is divided among all the
heirs, but the land is not physically divided. Thus, multiple
owners (in some cases thousands) can have an ownership interest
in the land and may have different ideas about how the land
should be used. Interior estimated that out of the 92,000
fractionated tracts (representing more than 10 million acres),
more than half generated no income in 2006-2011.\30\ For
agricultural leases and leasehold mortgages on fractionated
lands, BIA regulations require consent from owners of a
majority interest in such lands.\31\ However, according to
Interior, some allotments have thousands of co-owners, some of
whose whereabouts are unknown, which could make it difficult to
obtain their permission for an agricultural lease or a
leasehold mortgage.\32\
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\29\ Individual trust and restricted fee land also can be subject
to a leasehold mortgage with the approval of the Secretary of the
Interior, like Tribal trust and restricted fee land. In such cases,
lessees may encounter the same difficulties as described previously for
leasehold mortgages.
\30\ Department of the Interior, Land Buy-Back Program for Tribal
Nations: Initial Implementation Plan (Washington, D.C.: Dec. 18, 2012).
\31\ 25 CFR 162.207(c), 162.230(a). BIA also may grant an
agricultural lease on behalf of all of the individual Indian owners of
a fractionated tract if (1) they cannot agree on a lease within a
specified time period after BIA's written notification to them of its
intention to grant an agricultural lease on their behalf and (2) the
land is not being used by an Indian landowner. 25 CFR 162.209(b).
\32\ Department of the Interior, Land Buy-Back Program for Tribal
Nations.
Additionally, as a result of allotment, many Indian reservations
contain different land ownership types, creating a ``checkerboard''
pattern of lands that can make the establishment and financing of
large-scale agricultural projects difficult. For example, in addition
to Tribal and individual trust and restricted fee lands, reservations
also may include lands that passed out of trust during the allotment
period and were bought by non-Indians. Thus, multiple tracts within a
large-scale agricultural project may need to be leased and financed
separately because they have different owners and may be subject to
different laws. This can also make legal jurisdiction unclear, which is
a concern for private lenders financing projects on such lands, as
discussed below.
Experts and Tribal stakeholders we interviewed reported that the
barriers to collateralizing various types of Tribal lands make it
difficult for Tribes and Tribal members to access different types of
agricultural loans. Most long-term loans--typically used for larger
projects--generally need to be secured by real estate, which make these
inaccessible to Tribes and Tribal members who do not have land that can
be encumbered. For example, an Indian agricultural producer who
operates on trust land and wants to build an agricultural facility for
a value-added operation may not be able to obtain a long-term loan
unless he or she has other unrestricted land to pledge as collateral.
In addition, according to the former Executive Director of the
Intertribal Agriculture Council, when most agricultural producers face
economic distress, they can pledge land as security and receive an
extended period of time (20-40 years) to pay off the debt.\33\ Tribal
members may not have that option, making it difficult to obtain credit
in an emergency (such as adverse weather). In addition, according to a
Tribal agriculture expert and three Tribal stakeholders, Tribal trust
land is not counted as an asset on balance sheets, which may affect an
agricultural lender's assessment of a borrower's creditworthiness for
various types of loans.
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\33\ Breaking New Ground in Agribusiness Opportunities in Indian
Country, Senate Committee on Indian Affairs, 115th Cong. (Jan. 17,
2018); statement of Ross Racine, Executive Director, Intertribal
Agriculture Council.
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Administrative Process Delays May Deter Lenders and Borrowers
Processes at Interior--particularly at BIA--can increase the amount
of time it takes to obtain a loan, which can discourage both lenders
and borrowers, according to Tribal stakeholders and experts. Most of
the Tribal stakeholders and experts we interviewed told us that Tribal
members often encounter delays when seeking necessary documentation
from BIA. For example, for loans involving trust or restricted fee
lands, BIA needs to provide a title status report to the lender that
identifies the type of land ownership and current owners. Two Tribal
stakeholders told us that BIA takes months to produce a certified title
status report. By that time, the growing season could be over. A
representative from a Native CDFI serving a Tribe in the Great Plains
said it can take years to receive these reports. BIA reported that in
Fiscal Year 2017, it certified 95 percent of land titles within 48
hours.\34\ However, BIA's performance on this measure has varied
considerably over the last several years, and BIA officials told us
that it can take significantly longer to process title status reports
for complicated cases.
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\34\ BIA met its 48 hour processing goal in 71 percent and 46
percent of cases in Fiscal Years 2016 and 2015, respectively. See
Department of the Interior, U.S. Department of the Interior 2018/2019
Annual Performance Plan and 2017 Report (Washington, D.C.: Mar. 8,
2018).
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Tribal members also can encounter administrative challenges at
other points in the process. One Native CDFI representative told us she
found out that BIA did not record a leasehold mortgage when the CDFI
attempted to foreclose on the loan, which almost prevented the CDFI
from recovering the loan collateral. In other cases, Interior's
Appraisal and Valuation Services Office might need to conduct an
appraisal, such as for an agricultural lease. According to Interior
policy, these appraisals should be completed within 60 days, but one
Tribal economic development expert said they routinely take much
longer.
Lenders Reported Having Legal Concerns about Recovering Collateral
Involving Tribal Lands
As a result of the unique legal status of Tribes, some lenders,
including FCS associations, reported concerns about their ability to
recover loan collateral if the borrower defaulted on a loan involving
Tribal lands. Seven of the 11 FCS associations we contacted told us
that they had legal concerns of this nature, and six of the
associations said they had experienced the issues themselves. These
concerns primarily arise from the following issues:
Tribal sovereign immunity. Tribes are distinct, independent
political communities with certain inherent powers of self-
government and, as a result of this sovereignty, have immunity
from lawsuits. A lender cannot sue to enforce the terms of a
loan agreement with a Tribe unless the Tribe waives its
sovereign immunity in connection with the agreement. Private
lenders therefore might be hesitant to make a loan because they
would not be able to sue the Tribe if any disputes arose. We
previously reported that Tribes may waive sovereign immunity in
agreements or contracts on a case-by-case basis and some Tribes
have formed separate companies to conduct business that are not
immune from lawsuits.\35\ However, Tribal government officials
may decide that waiving the Tribe's sovereign immunity for
purposes of enforcing the loan agreement is not in the Tribe's
best interest. Additionally, Tribal sovereign immunity would
not bar lenders from seeking to foreclose on loans made to
individual Tribal members.
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\35\ GAO, Indian Issues: Observations on Some Unique Factors that
May Affect Economic Activity on Tribal Lands, GAO-11-543T (http://
www.gao.gov/products/GAO-11-543T) (Washington, D.C.: April 7, 2011).
Legal jurisdiction. Loans made to Indian Tribes or their
members and secured by Tribal lands or collateral located on
Tribal lands may be subject to Tribal laws, rather than state
laws. In addition, it is sometimes unclear whether Federal,
state, or Tribal courts would have jurisdiction in the event of
a default or foreclosure. If Tribal laws govern but do not
adequately provide for the lender's foreclosure, or if there is
not a legal forum to hear the foreclosure lawsuit, lenders may
be unable to recover the loan collateral. To address these
types of concerns, some Tribes have adopted secured transaction
codes modeled after the Uniform Commercial Code, which can help
to assure lenders of their ability to recover collateral in the
event of default.\36\
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\36\ Office of the Comptroller of the Currency, Commercial Lending
in Indian Country: Potential Opportunities in a Growing Market,
Community Developments Insights (Washington, D.C.: February 2016).
Unfamiliarity with Tribal laws. Laws and court systems vary
among the nation's 573 Tribes, making it more difficult and
costly for lenders to learn Tribal laws. For example, one FCS
association noted that it has many federally recognized Tribes
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in its region, each of which may have different laws.
If lenders have concerns regarding their ability to recover loan
collateral in the event of a default, lenders may not make loans
involving Tribal lands due to concerns that the loan would not meet
safety and soundness requirements.
Potential Borrowers May Need Assistance with Loan Readiness
Five Tribal stakeholders we interviewed said some Tribal members
may need assistance--such as credit repair and technical assistance for
loan applications--to become ready for agricultural loans. Some Tribal
members have no credit history, which can be a barrier to obtaining a
loan. One study found that compared to off-reservation counterparts,
reservation residents were more likely to have no credit history and
when credit scores were available, they were lower on average.\37\ Many
Native CDFIs provide credit builder or credit repair products to help
Tribal members qualify for larger loans, such as small business
loans.\38\
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\37\ Valentina Dimitrova-Grajzl, et al., ``Consumer Credit on
American Indian Reservations,'' Economic Systems, vol. 39 (2015): p.
518.
\38\ First Nations Oweesta Corporation, Snapshot 2018: The Growing
Native CDFI Movement, accessed April 19, 2019. https://www.oweesta.org/
wp-content/uploads/2018/11/Snapshot-2018-Growing-NCDFI-
Movement_web.pdf.
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Four Tribal stakeholders we interviewed said members of their
Tribes sometimes need technical assistance to complete the paperwork
required for agricultural loans, such as a business plan. One Tribal
member who owns a ranch told us that the first time he tried to apply
for a loan, he had trouble completing the required paperwork and
ultimately chose not to apply. He felt Tribal members seeking credit
would benefit from assistance in completing loan applications. One
Native CDFI representative told us that her organization provides
technical assistance to its borrowers to help them complete loan
paperwork but noted that commercial lenders often did not provide these
services.
Barriers Have Limited Commercial Lending on Tribal Lands
We and others have noted that the barriers described above have
depressed commercial lending on Tribal lands. In 2010, we found that
banks were reluctant to do business on Tribal lands because of the
cumbersome procedures and their lack of experience.\39\ More recently,
a report for the Department of Housing and Urban Development surveying
lenders found that BIA processing times were a major challenge in
making mortgage loans involving Tribal lands.\40\ A Native CDFI
representative told us that lenders have little incentive to engage in
a lengthy underwriting process, particularly if the loan is for a small
amount and if other potential borrowers have less complicated
circumstances. Some experts have described Tribal lands as ``credit
deserts.'' \41\ For example, one study of three different areas of
Tribal lands found that few financial institutions or automated teller
machines were located on these reservations.\42\ One Native CDFI
representative told us that in her experience, many people on her
reservation never had a bank account. She noted that when people do not
have a bank account, it can be challenging for them to see themselves
as potential borrowers.
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\39\ GAO, Native American Housing: Tribes Generally View Block
Grant Program Effective, but Tracking of Infrastructure Plans and
Investments Needs Improvements, GAO-10-326 (http://www.gao.gov/
products/GAO-10-326) (Washington, D.C.: Feb. 25, 2010).
\40\ David Listokin, et al., Mortgage Lending on Tribal Land: A
Report from the Assessment of American Indian, Alaska Native, and
Native Hawaiian Housing Needs (Washington, D.C.: January 2017).
\41\ For example, see Echo Hawk Consulting and Racine.
\42\ Jorgensen and Akee.
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Similarly, our analysis found that the land tenure issues,
administrative process delays, lenders' legal concerns, and loan
readiness issues can make agricultural loans involving Tribal lands
more time-consuming and costly to underwrite. For example, one FCS
association told us that loans involving Tribal lands require
specialized legal analysis, which may be an additional expense that it
would not incur for otherwise comparable loans. These same issues can
increase a lender's exposure to the risks inherent in agricultural
lending because they can affect the borrower's ability to repay the
loan, the adequacy of the collateral to secure the loan, and the
lender's ability to recover the collateral in the event of a
default.\43\ According to FCA, consistent with the purposes of the Farm
Credit Act of 1971, the ability of a lender to collect loans is an
important element of the institution's safety and soundness, and the
continued availability of credit.
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\43\ According to the Office of the Comptroller of the Currency,
the risks associated with agricultural lending are credit, interest
rate, liquidity, operational, price, compliance, strategic, and
reputation. See Office of the Comptroller of the Currency,
Comptroller's Handbook, Safety and Soundness: Agricultural Lending,
version 1.3 (Washington, D.C.: Oct. 15, 2018).
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Finally, some stakeholders said they believe that discrimination
also contributes to the lack of commercial lending on Tribal lands.
Four experts, a Tribal stakeholder, and a BIA representative told us
that they believe that some commercial lenders do not want to make
loans involving Tribal lands because of bias. As previously discussed,
the plaintiffs in the Keepseagle case that USDA settled for $760
million alleged that USDA discriminated against Native American farmers
and ranchers in certain programs. According to a Tribal economic
development expert, Tribal members who face discrimination or other
negative experiences with commercial lenders may share these
experiences with other Tribal members and deter them from applying for
credit.
FCS Laws Allow for Lending on Tribal Lands, and Some FCS Associations
Reported Lending to Tribes or Tribal Members
We found that FCS generally has authority to make loans involving
Tribal lands. Of the 11 FCS associations we contacted with Tribal lands
in their territories, some reported that they had recently made loans
to Indian Tribes or their members, and their outreach to these
populations included support for agricultural education.
FCS Laws Allow for Lending on Tribal Lands
Generally, FCS has authority to provide a broad range of credit
services to eligible agricultural producers, which may include Tribes,
Tribal businesses, and individual Tribal members operating on various
types of Tribal lands.\44\ However, borrowers must meet various
eligibility and underwriting criteria that are required by law. For
example, applicants for agricultural loans must be determined to be
eligible borrowers, which means they must own agricultural land or be
engaged in the production of agricultural products, including aquatic
products.\45\
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\44\ For example, eligible borrowers can be individual U.S.
citizens, as well as legal entities established pursuant to the laws of
any Tribal authority and legally authorized to conduct business. 12 CFR
613.3000. Groups of individual Tribal members operating as a
cooperative also may qualify, provided they meet the criteria set forth
in 12 CFR 613.3100.
\45\ Persons furnishing farm-related services also may be eligible.
See 12 U.S.C. 2017 and 12 CFR 613.3000.
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Also, long-term real estate loans (which have terms of up to 40
years) made by FCS institutions must be secured by a first-position
lien on interests in real estate, thus enabling FCS to obtain ownership
or control of the land in the event of default.\46\ FCA has determined
that this statutory requirement can be satisfied, for example, with
leasehold interests in real estate--such as that held by a Tribal
member leasing reservation land from a Tribe-provided that the lease
grants the borrower significant rights to the land, and the loan is
made on a safe and sound basis.\47\ As noted earlier, BIA regulations
often limit agricultural leases of Tribal lands to a term of up to 10
years. In such cases, FCS associations similarly may limit the term of
the related loan (to less than 10 years). According to FCA, when loans
are for shorter terms than the leases, the FCS association's first lien
is preserved, as required by law, and the loan is prudent from a safety
and soundness perspective.
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\46\ 12 U.S.C. 2018(a)(2).
\47\ Farm Credit Administration, ``Mortgage Lending: Does a
mortgage loan secured by a first lien on rural real estate that an
eligible borrower leases meet the requirements of section 1.10(a)(2) of
the Farm Credit Act of 1971?'' Legal Opinion Summary 07-01 (McLean,
Va.: June 12, 2007).
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FCA has not issued written guidance indicating whether interests in
other types of Tribal lands--such as individual trust or restricted fee
lands--also satisfy the requirement for a first-position lien on
interests in real estate. However, FCA has the authority to determine
what types of interests in real estate will satisfy this requirement.
Also, according to FCA, there is no statutory requirement that short-
and intermediate-term loans be secured with interests in real estate;
such loans instead can be secured by other collateral, such as
equipment, crops, livestock, and business revenues.
In addition to making direct loans to agricultural producers, FCS
has authority to lend to non-FCS institutions, such as commercial banks
and credit unions, which in turn make agricultural loans to FCS-
eligible borrowers. These other financing institutions are known as
OFIs.\48\
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\48\ In particular, FCS generally must assure funding to any
creditworthy OFI that (1) maintains at least 15 percent of its loan
volume at a seasonal peak in loans and leases to agricultural
producers, and (2) establishes a financing relationship with FCS for at
least 2 years. 12 CFR 614.4540. All such obligations funded through
FCS must be endorsed with the full recourse or unconditional guarantee
of the OFI. 12 CFR 614.4570. According to the 2017 FCS Annual Report,
FCS had outstanding loan volume to OFIs of $857 million as of December
31, 2017. This amount represented less than \1/2\ of 1 percent of FCS's
loan portfolio. FCS also may partner with non-FCS lenders through loan
syndications and participations, typically to reduce credit risk and
comply with lending limits. Also, under its similar-entity authority,
FCS may participate with non-FCS lenders that originate loans to those
who are not eligible to borrow directly from FCS, but whose activities
are functionally like those of eligible borrowers.
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According to FCA, the OFI lending authority allows FCS banks to
fulfill their mission as a government-sponsored enterprise by enhancing
the liquidity of OFIs, thereby lowering the cost of agricultural
credit. As noted earlier, FCS is required to establish programs to
serve young, beginning, and small farmers and ranchers, but it is not
statutorily mandated to focus on providing financial opportunities to
any other group of eligible agricultural producers.
Notwithstanding the authorities described above, FCS must comply
with other applicable laws and requirements. For example, FCS
institutions are subject to safety and soundness oversight by FCA,
including with respect to loan underwriting. FCS institutions also must
comply with applicable Federal, state, and Tribal laws governing any
Tribal lands or property thereon used as loan collateral. FCS
associations may obtain Farm Service Agency guarantees on loans to
borrowers who otherwise may not meet FCS underwriting requirements.
However, by law, loans made by FCS associations are not eligible for a
similar BIA loan guarantee program.\49\
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\49\ FCS associations are instrumentalities of the Federal
Government and thus their loans are ineligible for BIA guaranties. 12
U.S.C. 2071, 2091; 25 U.S.C. 1486, 25 CFR 103.10.
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Some FCS Associations Reported Lending to Indian Tribes or Their
Members, and Selected Associations' Outreach to These
Populations Included Education
Lending
Based on information from selected FCS associations located near
Tribal lands, some FCS associations have lent to Indian Tribes or their
members in the last 2 years.\50\ Of the 11 FCS associations we
contacted with Tribal lands in their territories, representatives of
eight told us they had loaned to Tribes or their members in the last 2
years--primarily to individual Tribal members. We made the following
observations based on the associations' responses:
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\50\ We sent questionnaires to the associations on March 14, 2019.
Therefore, the ``last 2 years'' generally would refer to loans made
since March 2017.
Limited data on lending amounts. Representatives of ten of
the 11 FCS associations we queried stated that they either do
not collect or do not maintain data on lending to specific
racial populations, thus making it difficult to provide more
detailed information on lending to Indian Tribes and their
members.\51\ However, four representatives provided estimates
of their recent lending to this population on Tribal lands. One
association cited more than $25 million in total loans
outstanding to a small number of Tribes and Tribal entities.
Another association reported making about $5.5 million in new
loans to Tribes or their members on Tribal lands in the last 2
years. A third reported a $3 million revolving line of credit
to a family farm, and the fourth said it had made approximately
$150,000 in five separate loans to two Tribal members.
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\51\ A representative of the remaining association stated that the
association collects data related to all of its lending, including
loans to Indian borrowers. As noted earlier, creditors are generally
prohibited from inquiring about the race and other personal
characteristics of an applicant for a credit transaction that is
subject to the Equal Credit Opportunity Act. 12 CFR 1002.5(b). One
exception is that creditors may collect such data from credit
applicants in order to assess the creditor's compliance with the Equal
Credit Opportunity Act. However, lenders may not use this information
in decisions about whether to provide credit or when setting the terms
of the credit.
Loan purposes. Seven associations reported on the type of
credit they extended to Indian Tribes and their members on
Tribal lands. In general, they made short-term operating loans
and short- and intermediate-term loans for the purchase or
refinance of items such as machinery and equipment, livestock,
vehicles, or buildings and improvements. Two associations also
reported making long-term real estate loans. The other
association that reported lending to Tribes or their members
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did not report on the types of loans it made.
Type of collateral. Representatives of the eight
associations that reported lending to Tribes or their members
all indicated that the associations secured loans with personal
property, such as crops, livestock, or equipment. In addition,
the associations that reported making real estate loans said
they secured the loans with fee-simple land.
Representatives of three FCS associations said they had not loaned
to Indian Tribes in the past 2 years. One association had not received
any credit applications from Tribal members, and another could not say
if it had served Tribal members because of a lack of racial data on
borrowers.\52\ The third association had not provided loans to Tribal
members in the past 2 years, but the representative stated that it
provided several letters of credit to guarantee the payments of BIA
leases on Tribal land.
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\52\ As noted earlier, in cases that did not involve lending, the
U.S. Supreme Court has ruled that membership in a federally recognized
Indian Tribe is a political, not a racial, classification.
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Although the FCS associations we contacted stated they have the
resources to lend to Tribes and their members on Tribal lands, a few
key factors affect their lending decisions. Representatives of all 11
FCS associations stated their associations had adequate financial
capacity and resources to make potentially more complicated or time-
consuming loans, such as those involving Tribal lands. In general, they
stated that the factors they consider in deciding whether to loan to
Indian Tribes or their members on Tribal lands are the same as for any
comparable loan--for example, creditworthiness, loan purpose, and the
ability to secure a lien on collateral. However, as described earlier,
some FCS association representatives described challenges related to
Tribal law, jurisdiction, Tribal sovereign immunity, and recovery of
collateral as complicating the lending process to Indian Tribes and
their members on Tribal lands. Although three of the 11 FCS
associations we queried reported making loans to Tribes that had waived
their sovereign immunity for those contracts, most loans the
associations reported were to individual Tribal members and secured by
personal property or fee-simple land.
According to two Tribal stakeholders we interviewed, Indian Tribes
or Tribal members who received loans from FCS or other commercial
lenders may have larger agricultural operations, a longer credit
history, and property that can be more easily used as collateral. For
example, an established rancher may be able to secure operating loans
with his or her cattle herd or interests in fee-simple land, thus
preventing the need to rely on trust land as collateral.
Outreach
At the national level, FCS--through its trade association, the Farm
Credit Council--conducts and facilitates outreach to Tribes and Tribal
stakeholder groups. According to a representative of the Farm Credit
Council, the Council and representatives of associations with Tribal
lands in their territories participate in an informal FCS working group
focused on outreach and lending on Tribal lands. One association
representative described the group as sharing examples of lending
success or reasons for missed opportunities; local, regional or
national sponsorship opportunities; local or regional agricultural
education events; and relevant legal proceedings, such as the
Keepseagle settlement.
At the institution level, FCS associations must prepare annual
marketing plans describing, among other things, how they will be
responsive to the credit needs of all eligible and creditworthy
agricultural producers in their respective territories, with a focus on
diversity and inclusion.\53\ The marketing plan must detail strategies
and actions to market their products and services to potential
borrowers who may not have been considered previously for reasons other
than eligibility or creditworthiness. However, FCS associations are not
required to achieve specific outcomes or quantifiable results.
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\53\ FCS marketing plans are also required to include strategies
and actions to promote diversity and inclusion within the association's
workforce and management, on the basis that diverse perspectives within
institutions can help increase diversity among customers. See,
generally, 12 CFR 618.8440 and 77 Fed. Reg. 25577 (May 1, 2012).
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Our nongeneralizable review of the marketing plans of the 11
selected FCS associations with Tribal lands in their territories and
our analysis of their written responses to our queries for additional
information found that outreach to Tribes and their members focused on
educational and charitable initiatives and direct marketing about
agricultural lending, or did not directly target Tribal populations.
Seven of the 11 associations discussed actual or planned
outreach to Indian Tribes or their members in their marketing
plans or written responses.
Four of those seven associations cited financial
support of specific agricultural education activities for
Tribes and their members. Two associations reported making
charitable donations that benefited Tribal members.
Four of the seven associations reported direct
marketing to potential Tribal borrowers. However, in one
case, the marketing was a one-time conversation with a
Tribe regarding financing for a new facility. The other
three associations reported that they called potential
Indian borrowers, sought referrals from existing Tribal
member customers, or conducted meetings with Tribal
government officials.
In general, the four remaining associations, in their
marketing plans and written responses, addressed outreach to
minority producers through broader methods, such as
participation in ethnic group organizations or through
inclusion in the association's overall outreach and marketing
efforts. In addition, five of the 11 associations discussed
outreach to minority producers in conjunction with their
statutorily-mandated outreach to young, beginning, and small
farmers. According to FCA officials, FCA's guidance on
providing credit to young, beginning, and small farmers, as
well as to local food producers, would be broadly applicable to
socially disadvantaged or minority populations that fall within
the program definitions.
Most of the Tribal stakeholders with whom we spoke either were not
familiar with FCS or did not know of the Tribe or any of its members
receiving FCS loans. One Native CDFI representative noted that although
he was not familiar with any members of his Tribe receiving FCS loans,
he thought other nearby Tribes or their members had worked with FCS.
FCA also encouraged FCS associations to develop underwriting
procedures to facilitate lending on Indian reservations.\54\ FCA
identified one FCS association that developed such procedures, and
another one of the associations we queried noted that they had such
procedures. The first association provided an overview of its
procedures, which identified links to information on borrower and
collateral eligibility and actions that require BIA approval, among
other topics. According to representatives of the second association,
its procedure manual directs loan officers to treat Tribal members'
applications for loans secured by personal property the same as any
other applications. In addition, they said the manual contains
instructions for working with BIA for real estate loans to Tribal
members on trust land and for making direct loans to Tribes.
---------------------------------------------------------------------------
\54\ In general, lenders must comply with applicable fair lending
laws, including the Equal Credit Opportunity Act. For example, with
regard to mortgage lending in Indian Country, the Office of the
Comptroller of the Currency has stated that while lenders may consider
risks and costs in setting the terms and conditions for loans, the
procedures should be based on documented differences in risks and
costs, rather than speculative or generalized assumptions. See Office
of the Comptroller of the Currency, Guide to Mortgage Lending in Indian
Country (Washington, D.C.: 1997). FCA took a similar position in the
past, when it evaluated an institution's procedures for lending on
Indian reservations. In that case, the institution's procedures
required additional security in the form of government guarantees on
any loan for which reservation land was pledged as collateral. The
association based the additional security requirement in part on
generalized concerns that Tribal courts were inadequate forums in which
to recover collateral, rather than evidence regarding the courts of the
specific Tribe in question. FCA ultimately determined that the
institution's procedures were not consistent with the Equal Credit
Opportunity Act, and required that the procedures be withdrawn.
---------------------------------------------------------------------------
Stakeholders Discussed Lender Partnerships, Loan Guarantees, and Other
Options to Improve Agricultural Credit Access on Tribal Lands
Our review of literature and interviews with experts, Tribal
stakeholders, FCS associations, Farm Credit Council representatives,
and FCA officials identified the following options for improving access
to agricultural credit on Tribal lands.
Partnerships with local lenders. Tribal economic development
experts and Tribal stakeholders cited the importance of
commercial or government lenders partnering with Native CDFIs
and other Indian-owned lenders, which are the most capable of
navigating the challenges related to Indian agricultural
credit. According to these experts and stakeholders, if larger
commercial or government lenders worked with Native CDFIs or
other Tribal lenders (such as Tribal banks or economic
development corporations) to provide funds or conduct outreach,
the Tribal organizations could more efficiently reach Indian
Tribes and their members. They noted these organizations are
familiar with Tribal members and the administrative processes
for obtaining loans on Tribal land. Partnership with Tribal
lenders and other Tribal businesses also could support Tribes'
efforts to improve members' loan readiness, according to
literature we reviewed and a Tribal economic development expert
and a Native CDFI representative we interviewed.\55\
---------------------------------------------------------------------------
\55\ The executive director of a Native CDFI has noted that because
Native CDFIs are mission-driven, they offer development services--such
as financial education and business training--that banks do not. See
Tanya Fiddler, ``Working Together: Effective Partnerships between
Native CDFIs and Banks Bridge the Financing Gap in Indian Country''
August 2013, accessed on March 21, 2019. https://www.occ.gov/
publications/publications-by-type/other-publications-reports/cdi-
newsletter/extending-credit-indian-country-aug-2013/indian-country-
ezine-article-7-working-together.html. In addition, a 2017 study on
mortgage lending on Tribal lands similarly noted the importance of
commercial lenders partnering with Tribes and local nonprofits serving
Tribal members to provide homebuyer education. See David Listokin, et
al., Mortgage Lending on Tribal Land.
Commercial and government lenders may need to clarify whether
Tribal lenders with which they might partner meet their lending
requirements. For example, although FCS banks have authority to
lend to OFIs, which in turn can lend to FCS-eligible borrowers,
only certain types of CDFIs may qualify as OFIs.\56\ In
addition, this authority does not extend to long-term funding,
and thus cannot be used to fund agricultural real estate loans
made by OFIs.\57\ One FCS bank that commented on a 2004 FCA
rule noted the latter statutory limitation as a major
impediment to OFI program expansion.
---------------------------------------------------------------------------
\56\ OFIs can include banks, credit unions, agricultural credit
corporations, and certain other entities engaged in the making of loans
to agricultural producers. 12 U.S.C. 2015(b)(1)(B) and 12 CFR
614.4540. The preamble to an FCA rule confirms that CDFIs that are
community development banks or community development credit unions
could qualify as an OFI. 69 Fed. Reg. 29852, 29860 (May 26, 2004).
However, most Native CDFIs operate as loan funds chartered as state
corporations, the eligibility of which the preamble to the FCA rule did
not address.
\57\ 69 Fed. Reg. 29852, 29859 (May 26, 2004).
Flexibility with collateral requirements. As noted earlier,
multiple stakeholders we interviewed discussed the challenges
related to collateralizing trust land. In addition, FCA
officials cited the need for a statutory change or
clarification of the requirement that long-term loans made by
FCS be secured by a first lien on interests in real estate.\58\
They said that by removing or clarifying this requirement,
lenders would have authority to provide larger, longer-term
loans to creditworthy Tribes or Tribal members who cannot
mortgage their Tribal lands.
---------------------------------------------------------------------------
\58\ Two FCS stakeholders called for statutory or regulatory
clarification on whether leasehold interests in real estate can satisfy
this statutory requirement. But as noted earlier, FCA already published
a legal opinion to that effect (07-01).
Guarantees. Some stakeholders we interviewed mentioned loan
guarantees as an option to improve access to agricultural
credit on Tribal lands. For instance, FCA officials and Farm
Credit Council representatives told us they had spoken with
leadership of the Native American Agriculture Fund (created as
part of the Keepseagle settlement) regarding the potential
establishment of a loan guarantee fund, such as a first-loss
fund, which would step in to purchase a loan in default (thus
substantially reducing credit risk to the lender). In addition,
three of the 11 FCS associations we queried identified
guarantees as a possible way to increase FCS lending to Indian
---------------------------------------------------------------------------
Tribes and their members on Tribal lands.
FCS associations still face challenges in using guarantees. With
regard to the first-loss loan guarantee fund, FCS associations
still must adhere to the FCS statutory requirement for a first-
position lien on interests in real estate for long-term loans.
According to an FCA official, although the first-loss loan
guarantee fund could mitigate repayment risk, a statutory
change or clarification would be necessary for FCS associations
to accept guarantees in lieu of real estate for long-term
loans. And as noted earlier, FCS loans are statutorily
ineligible for BIA's loan guarantee program. Two FCS
associations noted that removal of this restriction could
increase FCS lending on Tribal lands. Finally, FCA officials
stated that challenges FCS associations face in making loans
involving Tribal lands also can extend to Farm Service Agency
guarantees on those loans. In other words, to obtain such
guarantees, FCS associations must navigate issues around land
tenure, legal jurisdiction, and Tribal laws.
Tribal options. In addition, stakeholders discussed the
following Tribal actions that could increase credit access for
Tribes and their members:
Representatives of two FCS associations noted that
waivers of sovereign immunity (limited to specific
contracts) by Tribes may increase lending involving Tribal
lands, as it helps to enable lenders to enforce the terms
of loans made to Tribes. According to the Office of the
Comptroller of the Currency, some banks have negotiated
limited waivers of sovereign immunity (restricted to a
specific transaction). As noted earlier, Tribes may decide
that waiving sovereign immunity is not in their best
interest. In addition to the limited waivers of sovereign
immunity, representatives of three FCS institutions stated
that increased adoption of uniform commercial laws (such as
the Uniform Commercial Code) by Tribes could increase
lending involving Tribal lands.
One Tribal economic development expert told us that
Tribes that adopted their own leasing regulations under the
HEARTH Act have seen substantially increased economic
development. As noted earlier, the HEARTH Act provides
Tribes with greater flexibility to enter into leases for
agriculture or other purposes. Once a Tribe's leasing
regulations have been approved by the Secretary of the
Interior, Tribes may negotiate and enter into agricultural
leases with 25 year terms without further approval by the
Secretary.\59\ The combination of longer lease terms and
the ability to conduct business outside of the BIA approval
process can expedite the process of obtaining a leasehold
mortgage on Tribal trust and restricted fee land. As of May
1, 2019, the Secretary had approved agricultural leasing
regulations for seven Tribes under the HEARTH Act.\60\
---------------------------------------------------------------------------
\59\ 25 U.S.C. 415(h).
\60\ In addition, the Secretary of the Interior approved the Navajo
Nation's agricultural leasing regulations pursuant to other statutory
authority, thus allowing the Tribe to lease its trust and restricted
fee land for agricultural purposes without Secretarial approval. 25
U.S.C. 415(e). We recently reported BIA's review and approval process
for 42 proposed leasing regulations that Tribes submitted in 2012-2017
often took at least a year. We recommended that Interior and BIA
develop a clearly documented process with established time frames for
each step in the process for reviewing proposed Tribal leasing
regulations submitted under the HEARTH Act. Interior concurred with the
recommendation but had not implemented it as of May 2019. See GAO,
Indian Programs: Interior Should Address Factors Hindering Tribal
Administration of Federal Programs, GAO-19-87 (http://www.gao.gov/
products/GAO-19-87) (Washington, D.C.: Jan. 3, 2019).
---------------------------------------------------------------------------
Agency Comments
We provided a draft of this report to FCA, Interior, and USDA for
review and comment. FCA and USDA provided technical comments, which we
incorporated as appropriate. In comments provided in an email, Interior
officials noted that efforts to simplify the Secretary of the
Interior's approval process could provide faster mortgage
determinations and thus may result in expanded lending and production
opportunities for Indian agricultural producers.
We are sending copies of this report to the appropriate
congressional committees, the Chairman and Chief Executive Officer of
the Farm Credit Administration, the Secretary of the Interior, and the
Secretary of Agriculture. In addition, the report is available at no
charge on the GAO website at http://www.gao.gov.
If you or your staff have any questions about this report, please
contact me at (202) 512-8678 or [email protected]. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this report. GAO staff who made key contributions
to this report are listed in appendix II.
Alicia Puente Cackley,
Director, Financial Markets and Community Investment.
Appendix I: Objectives, Scope, and Methodology
Our objectives in the report were to describe (1) what is known
about the agricultural credit needs of Indian Tribes and their members
on Tribal lands, (2) the barriers stakeholders and experts identified
that Indian Tribes and their members on Tribal lands face in obtaining
agricultural credit to meet their needs, (3) the Farm Credit System's
(FCS) lending authority and lending and outreach activities on Tribal
land, and (4) suggestions stakeholders have discussed to improve access
to agricultural credit on Tribal lands.
For the purpose of this report, we use the term ``Tribal lands'' to
refer to reservations (including all land within the reservations'
boundaries), trust land, allotments, and restricted fee land. In
general, our report focuses on the agricultural credit needs of Tribes
and their members in the lower 48 states.
To describe what is known about the agricultural credit needs of
Indian Tribes and their members on Tribal lands, we explored various
potential data sources on agricultural loans that Indian Tribes and
their members applied for or received. We reviewed available data from
the Consumer Financial Protection Bureau and Department of Agriculture
(USDA). For example, we obtained borrower-reported loan data from
USDA's Agricultural Resource Management Survey, but for several data
fields related to Indian producers on Tribal lands, sample sizes were
too small or the coefficients of variation were too high to produce
reliable estimates. We also reviewed provisions of the Equal Credit
Opportunity Act, Federal regulations, and other legal documentation
pertaining to collection of data regarding the personal characteristics
of applicants for nonresidential loans.
To describe what is known about Indian Tribes and their members'
agricultural credit needs and the barriers they face in obtaining
agricultural credit, we conducted a literature review. We conducted
searches of various databases, such as EBSCO, ProQuest, Google Scholar,
and Westlaw to identify sources such as peer-reviewed academic studies;
law review articles; trade and industry articles; reports from
government agencies, nonprofits, and think tanks; and Congressional
transcripts related to Tribal agriculture, barriers to accessing credit
on Tribal lands, and FCS. We identified additional materials through
citations in literature we reviewed. In addition, we reviewed statutes
and the Department of the Interior's Bureau of Indian Affairs' (BIA)
regulations related to use and ownership of Tribal lands, including
leasing.
To describe FCS's authority and lending and outreach activities on
Tribal lands, we reviewed statutes and regulations governing FCS, as
well as written guidance issued by the Farm Credit Administration
(FCA). We also reviewed the marketing plans of a nongeneralizable
sample of 11 FCS associations (16 percent of the 69 FCS associations
that lend directly to agricultural producers) whose territories
included large Tribal land areas with high levels of agricultural
activity, including the Tribes we interviewed (described below). We
selected an additional FCS association but on closer review realized it
did not have a significant amount of Tribal land in its territory; we
therefore excluded this association from our analysis. For comparison
purposes, we also reviewed three marketing plans from FCS associations
that did not have significant Tribal populations in their territories.
In addition to reviewing the marketing plans, we sent the 11 FCS
associations a questionnaire about their lending and outreach to Tribes
and their members and any challenges in making loans involving Tribal
lands. We also asked these associations about any suggestions to
improve access to agricultural credit on Tribal lands. We received
responses from all 11 FCS associations, and followed up with some
associations to clarify information they provided. While the sample
allowed us to learn about many important aspects of FCS associations'
lending and outreach to Tribes and their members on Tribal lands, it
was designed to provide anecdotal information, not findings that would
be representative of all of 69 FCS lending associations.
To address all four objectives, we attempted to interview
representatives of six Tribes. First, we selected these Tribes to
represent five regions (Great Plains, Rocky Mountain, Northwest,
Southwest) and a state (Oklahoma) that--according to experts we
interviewed--have Tribes engaged in agricultural activity. Within these
regions, we generally selected large Tribal land areas that have high
levels of agricultural activity, as indicated by the USDA 2012 Census
of Agriculture data.\1\ Specifically, we selected Tribes based on
number of farms, land in farms, and market value of agricultural
products. In addition, we selected one of the six Tribes because two
experts recommended that we speak with them. For the six Tribes, we
contacted Tribal government leaders and employees of the relevant
government offices, such as the agriculture or Tribal lands
departments.
---------------------------------------------------------------------------
\1\ Department of Agriculture, 2012 Census of Agriculture: American
Indian Reservations, Subject Series, Part 5, AC-12-S-5 (Washington,
D.C.: August 2014).
For two of the six Tribes, we interviewed employees of the
Tribal agriculture department. One of these interviews also
included representatives of the Native Community Development
Financial Institution (Native CDFI) that serves the
---------------------------------------------------------------------------
reservation.
For the third Tribe, we received written responses from a
Tribal farm.
For the fourth Tribe, we interviewed a representative of the
Native CDFI that serves the reservation.
For this series of interviews, we only received information
relating to four Tribes. We did not obtain meetings with
relevant Tribal government officials for the last two Tribes.
We also contacted farms or Native CDFIs associated with an
additional three Tribes based on USDA data or recommendations from
experts we interviewed. For one of these Tribes, we interviewed a
Tribal farm employee and a representative of the Tribe's community
development corporation. For the second Tribe, we interviewed a Tribal
farm employee. For the third Tribe, we interviewed a representative of
the Native CDFI that serves the reservation.
In summary, we interviewed employees of two Tribal agriculture
departments, employees of three Tribal farms, and representatives of
three Native CDFIs and one Tribal community development corporation.
Throughout this report, we refer to Tribal government employees, Tribal
farm employees, or representatives of Native CDFIs or community
development corporations serving a Tribe as ``Tribal stakeholders.''
Although the information we obtained from the Tribal agriculture
employees allowed us to provide anecdotal Tribal perspectives, it is
not generalizable to the 573 federally recognized Indian Tribes. In
addition, the views of Tribal farm employees and Native CDFI and
community development corporation representatives cannot be generalized
to Tribes but illustrate views on needs, barriers, and other issues
from the perspectives of the organizations.
In addition, for all four objectives, we interviewed the following:
Experts on agricultural and economic development on Tribal
lands. We interviewed subject matter experts on Tribal
agriculture and economic development from various
organizations, including advocacy and academia. Specifically,
we interviewed representatives of the following organizations:
the Center for Indian Country Development at the Federal
Reserve Bank of Minneapolis, First Nations Oweesta Corporation,
the Indian Land Tenure Foundation, the Indigenous Food and
Agriculture Initiative at the University of Arkansas, the
Intertribal Agriculture Council, and the Native American
Agriculture Fund. We selected these organizations based on
relevant publications, testimonies before Congress, or
recommendations from other experts. These organizations work
with a number of Tribes and thus could speak to general trends
or commonalities in Tribal agriculture and economic
development. Throughout the report, we refer to the
representatives of these organizations as ``experts.''
Agency and trade group representatives. We interviewed
officials from FCA, USDA (including the Farm Service Agency,
Economic Research Service, and National Agricultural Statistics
Service), and BIA. We also interviewed representatives of the
Farm Credit Council, the national trade association for the
Farm Credit System.
We conducted this performance audit from December 2018 to May 2019
in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
Appendix II: GAO Contact and Staff Acknowledgments
GAO Contact
Alicia Puente Cackley, (202) 512-8678, [email protected]
Staff Acknowledgements
In addition to the contact named above, Karen Tremba (Assistant
Director), Lisa Reynolds (Analyst in Charge), Miranda Berry, Tom Cook,
Anne-Marie Fennell, John Karikari, Marc Molino, Kirsten Noethen,
Barbara Roesmann, Jeanette Soares, and Farrah Stone made significant
contributions to this report.
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______
Submitted Questions
Response from Hon. Thomas ``Tom'' J. Vilsack, Secretary, U.S.
Department of Agriculture
Questions Submitted by Hon. Alma S. Adams, a Representative in Congress
from North Carolina
Question 1. Secretary Vilsack, with more than 5,700 operations,
North Carolina ranks second in the U.S. for total poultry and egg
production.
As I've raised before, in a state where the population is 22
percent Black, only 57 of farms have an African American principal
producer. That's less than one percent.
As you're aware, there are allegations of Black farmers being
discriminated against through poultry contract grower relationships,
and that some stakeholders are concerned that the final rule issued by
the previous Administration does not go far enough to protect contract
growers, particularly contract growers of color.
Mr. Secretary, will you commit to continuing to work on this
important issue to ensure Black farmers and other farmers of color are
not discriminated against in their production contracts?
Answer. Yes, I am fully committed to ensuring that farmers of color
are not discriminated against in production contracts. To that end, we
are hard at work preparing proposed rules under the Packers and
Stockyards Act to set clear, enforceable rules of the road that protect
Black farmers and farmers of color to the greatest extent possible. We
have also announced a new enforcement policy, via Frequently Asked
Questions, that addresses the problematic aspects of a Packers and
Stockyards Act rule published by the previous administration. This new
enforcement policy highlights USDA's intent to utilize other provisions
of the Packers and Stockyards Act to the fullest extent of the law to
protect producers from racial discrimination, retaliation, and denial
of associational rights. Throughout this process, we are in contact
with a wide range of stakeholders in the poultry industry to better
understand their concerns and are committed to monitoring the facts on
the ground to more quickly and better address these issues as they
emerge. We invite those who are facing these challenges to contact us,
including anonymously as appropriate. (https://www.ams.usda.gov/rules-
regulations/packers-and-stockyards-act/faq)
attachment
[https://www.ams.usda.gov/rules-regulations/packers-and-stockyards-act/
faq]
Frequently Asked Questions on the Enforcement of Undue and Unreasonable
Preferences under the Packers and Stockyards Act
August 2021
9 CFR 201.211 Undue or unreasonable preferences or
advantages.\1\
---------------------------------------------------------------------------
\1\ https://www.ecfr.gov/cgi-bin/text-
idx?c=ecfr&SID=b74225c6eb76359a245b8953706e6916&
rgn=div5&view=text&node=9:2.0.1.1.2&idno=9#se9.2.201_1211.
Editor's note: references annotated with are retained in
Committee file.
---------------------------------------------------------------------------
Packers and Stockyards Act 9 CFR 201-206 \2\
---------------------------------------------------------------------------
\2\ https://www.ecfr.gov/cgi-bin/text-
idx?c=ecfr&SID=b74225c6eb76359a245b8953706e6916&
rgn=div5&view=text&node=9:2.0.1.1.2&idno=9#se9.2.201_1211.
---------------------------------------------------------------------------
Visit the Packers and Stockyards Act webpage \3\
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\3\ https://www.ams.usda.gov/rules-regulations/packers-and-
stockyards-act.
---------------------------------------------------------------------------
General Policy
Question: What is the Packers and Stockyards Act?
Answer: The Packers and Stockyards Act (the P&S Act or the Act)
promotes fairness and competition in livestock, meat, and poultry for
the benefit of producers, growers, and the public. The Act also
provides payment protection and prohibits deception and fraud in the
livestock, meat, and poultry industries. The U.S. Department of
Agriculture's (USDA) Packers and Stockyards Division (PSD), located
within the Agricultural Marketing Service (AMS), is charged with
enforcing the Act and protecting the rights of livestock producers and
poultry growers under the Act.
Question: Why did USDA develop a rule on undue and unreasonable
preferences? Is it all that USDA will be doing on undue preferences?
Answer: The 2008 Farm Bill (Title XI of the Food, Conservation and
Energy Act of 2008)(P.L. 110-246), required USDA to write regulations
under the P&S Act's provisions that prohibit packers, swine
contractors, and live poultry dealers from engaging in undue
preferences to some over others in the livestock and poultry
industries. The rule ``Undue and Unreasonable Preferences and
Advantages'' was finalized in December 2020 and became effective in
January 2021. Since then, USDA has announced its intent to update those
and other provisions through a series of three rulemakings under the
P&S Act. However, until those new rulemakings are complete, the
December 2020 final rule remains in effect. (USDA, ``USDA to Begin Work
to Strengthen Enforcement of the Packers and Stockyards Act,'' \4\
Press Release, June 11, 2021.)
---------------------------------------------------------------------------
\4\ https://www.usda.gov/media/press-releases/2021/06/11/usda-
begin-work-strengthen-enforcement-packers-and-stockyards-act.
Question: What are the criteria established in the December 2020
---------------------------------------------------------------------------
final rule?
Answer: The final rule established four criteria the Secretary of
Agriculture will consider when determining whether conduct by packers,
swine contractors or live poultry dealers represents an undue or
unreasonable preference or advantage. Those criteria include whether
the preference or advantage cannot be justified on the basis of a cost
savings related to dealing with different producers, sellers, or
growers; cannot be justified on the basis of meeting a competitor's
prices; cannot be justified on the basis of meeting other terms offered
by a competitor; and cannot be justified as a reasonable business
decision. However, as elaborated below, the criteria are not exhaustive
and not determinative. (Agricultural Marketing Service, USDA, ``Undue
and Unreasonable Preferences and Advantages Under the Packers and
Stockyards Act,'' \5\ Final Rule, December 11, 2020.)
---------------------------------------------------------------------------
\5\ https://www.federalregister.gov/documents/2020/12/11/2020-
27117/undue-and-unreasonable-preferences-and-advantages-under-the-
packers-and-stockyards-act.
Question: How will PSD enforce the criteria in the December 2020
final rule? Will some criteria be weighed more heavily than others? Can
---------------------------------------------------------------------------
other criteria be considered?
Answer: Section 201.211 of the final rule lists the criteria for
consideration and provides that ``the Secretary [of Agriculture] is not
limited to those four . . . [T]he Secretary may also consider other
factors relevant to each situation on a case-by-case basis.'' That is,
the criteria are not exhaustive and not determinative. PSD will enforce
the provisions of the regulation by reviewing the specific facts of
each case to determine how it is handled. Certain circumstances will
require some criteria to be weighted more than others, including
criteria not specifically listed. The criteria listed in the final rule
are not a safe harbor, and a finding regarding one of them will not
eliminate potential liability under the P&S Act should other criteria
suggest violations.
Question: Do the criteria also apply to ``unfair, unjustly
discriminatory or deceptive practices and devices'' that are prohibited
in Section 202(a) of the Packers and Stockyards Act?
Answer: No. The criteria were written to respond to the 2008 Farm
Bill requirement that the Secretary develop criteria to consider when
determining if an undue or unreasonable preference or advantage has
occurred in violation of the P&S Act. Unfair, unjustly discriminatory,
and deceptive practices and devices are not specifically included under
these criteria.
Question: How does PSD decide if an unfair, unjustly
discriminatory, or deceptive practice or device has occurred in
violation of the Act?
Answer: PSD considers potential violations of Section 202(a) of the
P&S Act on a case-by-case basis. Some conduct is deemed ``unfair''
under the Act, such as failing to timely pay for livestock and poultry
purchases. (See Section 409, P&S Act.) Other conduct is ``unfair''
based upon enforcement cases and PSD regulations. PSD investigates and
gathers evidence to decide if a violation has occurred. Additionally,
many practices that PSD considers undue prejudices may also be
evaluated by PSD as unfair, unjustly discriminatory, or deceptive
practices under Section 202(a) of the P&S Act.
Question: Is Packers and Stockyards Act analysis limited by the
``rule of reason'' approach under antitrust laws such as Section One of
the Sherman Act?
Answer: The December 2020 rule states PSD may consider the ``rule
of reason'' approach described in cases such as Chicago Board of Trade
v. United States, 246 U.S. 231 (1918), but also that it is not limited
by or to that analysis and it maintains a flexible approach. Like the
Sherman Act, the statute is textually susceptible to both ``rule of
reason'' type analysis, but also ``per se'' rules for certain types of
conduct. The unique circumstances applicable to the markets where PSD
investigates or has enforcement authority also inform the competition
analysis in distinct and important ways, including allowing for
simplified competitive effects analysis where common market
characteristics inform consideration of specific types of conduct. In
addition, the PSD has long taken the position that a violation of
section 202(a) or (b) of the P&S Act may be established without proving
an industry-wide injury to competition. Moreover, the December 2020
final rule does not determine what evidence would be required or
necessarily used in a court of law. The future rulemakings, mentioned
above, are expected to elaborate on these points.
Discrimination and Retaliation
Question: How would PSD handle a case where a packer, swine
contractor, or poultry company withheld a contract offer or cancelled
or terminated a contract on the basis of race, color, national origin,
sex, religion, age, disability, political beliefs, sexual orientation,
or marital or family status, where the producer or grower was capable
of meeting the terms of the contract?
Answer: PSD would investigate as, based on the information
provided, the contract termination may have violated Sections 202(a)
and/or 202(b) of the P&S Act. As the December 2020 final rule noted,
``Issues of retaliation and racial discrimination typically would arise
in complaints of undue or unreasonable prejudices or disadvantages.''
Question: Is retaliation prohibited? For example, if a producer or
grower makes public statements criticizing a packer, swine contractor,
or poultry company, and the packer or poultry company in turn
terminates an existing contract with the producer or grower, would that
contract termination be an unfair practice?
Answer: The December 2020 final rule noted, ``Existing law
prohibits retaliation.. Issues of retaliation. typically would arise in
complaints of undue or unreasonable prejudices or disadvantages.'' PSD
will investigate allegations of coercion, intimidation, or retaliation
against any producer or grower as termination of a contract under such
circumstances may violate Sections 202(a) and/or 202(b) of the P&S Act.
Industry-specific Circumstances: Poultry
Question: I have a poultry growing (broiler) house that does not
have the latest technology that some of the other growers in the local
area have. (A) When it came time to renew my poultry growing contract,
the poultry company cut the number of birds placed on the farm, offered
me a lower contract price, or threatened to terminate the contract,
unless I upgrade my houses. Is this an undue or unreasonable prejudice
or an unfair practice? (B) The growers with the upgraded houses have
received a higher base price. Are they receiving an undue preference or
advantage over me?
Answer: It depends. (See Packers and Stockyards Act Regulation
201.216.\6\)
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\6\ https://www.ams.usda.gov/rules-regulations/packers-and-
stockyards-act.
In part (A), PSD could investigate whether this was an undue
or unreasonable prejudice or an unfair practice. For example,
decreasing the number of birds or your contract rate, or
threatening to terminate your contract, could result in PSD
investigating whether coercion or retaliation was present. PSD
could also investigate whether any higher pay offered by the
poultry company if the grower makes the upgrades is adequate
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for the grower to reasonably recoup the cost of the upgrades.
In part (B), PSD could investigate whether the poultry
company's payment of higher contract rates to the growers who
upgrade their houses was an undue preference. While PSD could
consider, for example, whether the upgraded housing results in
a cost savings to the poultry company through lower feed
conversion or lower bird mortality, other factors will also be
examined on a case-by-case basis and appropriately weighed to
determine if an undue preference was involved. PSD would
examine, for example, whether there is evidence of a pattern
and practice of racial discrimination, or whether benefits
available from the poultry company or its regular business
partners are available to growers, including those growers that
participate in associations.
Question: My integrator recorded a delivery of 40,000 pounds of
feed to me but delivered only one-half that amount, based on how the
feed looks in my feed bins. Can they do that?
Answer: A poultry company's failure to deliver the full amount of
feed shown on the feed mill's scale ticket and recorded to a grower's
account is a material breach of the contract and an unfair and
deceptive practice in violation of the P&S Act. Note that it can be
difficult to judge the weight of feed based on how it appears in the
feed bin. Pelleted feed that weighs the same as starter (or crushed)
feed may appear to take up more room in a feed bin when the weight is
the same. The type and quality of feed ingredients can also affect how
feed looks inside a feed bin.
Question: Some growers have not received sufficient information
from poultry companies to determine the accuracy of their pay. Could
this be an unfair or deceptive practice?
Answer: Yes. Regulations require that poultry growers receive all
information necessary to calculate and verify their settlement pay. PSD
would consider it an unfair and deceptive practice for a poultry
company to refuse to provide a grower with the information and data
used to determine compensation, upon the grower's request. This data
would include, but is not limited to, feed conversion rates, feed
analysis, origination, and any other factor that impacts pay. (See
Packers and Stockyards Act Regulation 201.100(d).\7\)
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\7\ https://www.ams.usda.gov/rules-regulations/packers-and-
stockyards-act.
Question: The contract I got from the poultry company requires any
disputes about my contract to be resolved in State A where the company
is incorporated. My poultry farm is located in State B. Do I have to go
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to court in State A?
Answer: No. The P&S Act requires that any disputes related to
poultry growing contracts or swine production or marketing contracts be
resolved within the federal judicial district in which the principal
part of the performance takes place. In your example, any legal action
such as a lawsuit must occur within the federal judicial district in
State B where your farm is located. (See Section 209(a) of the Packers
and Stockyards Act (7 U.S.C. 197b(a)).\8\)
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\8\ https://www.ams.usda.gov/rules-regulations/packers-and-
stockyards-act.
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Industry-specific Circumstances: Cattle
Question: The beef packer that I sell fed cattle to routinely
refuses to put a fixed price in the contract, but instead ties the
contract to a spot market that trades and whose prices are reported
several days later. The packer may not bid in that market, and there
may not even be enough bidders in the market for there to be a reported
price. Is that an unfair or deceptive practice?
Answer: Based on the information provided, PSD may investigate to
determine if the packer engaged in efforts to lower the spot market
price. One factor that may be considered in the investigation is the
level of regional concentration. Price manipulation violates the P&S
Act.
Question: A packer offers to buy cattle from my neighbor on a
negotiated spot market live weight basis. The same packer will take my
cattle only if I agree to sell them on its standard market formula. The
cattle are the same quality. Is this a violation of the Packers and
Stockyards Act?
Answer: Based on the information provided, PSD would investigate
whether the packer is consistently treating you less favorably than
other similar producers and if that treatment rises to the level of an
undue prejudice. PSD may also investigate whether the packer is
providing a preference to your neighbor that cannot be justified as
cost savings, meeting a competitor's price or terms, or as a reasonable
business decision. In furtherance of policy set out in the Agricultural
Fair Practices Act of 1967 (7 U.S.C. 2301 et seq.), PSD generally
would not view cost savings to include circumstances where multiple
producers can meet reasonable terms of delivery on a cooperative or
aggregated basis.
Question: The beef packer that I sell fed cattle to on a negotiated
basis routinely offers higher negotiated prices for cattle of the same
quality to a feeder whose cattle are certified as organic. My cattle
are not certified as organic. Since the quality of the cattle,
including yield grade, is the same as the organic cattle, does the
premium paid for the organic cattle constitute an undue preference or
advantage?
Answer: Based on the information provided, no. Products with
special characteristics, e.g., organic, generally have higher retail
prices. Therefore, packers are willing to pay more for cattle that are
certified as organic.
Industry-specific Circumstances: Hogs
Question: I grow hogs on a contract basis. I believe that the waste
from many of the neighboring growing structures is being handled
improperly, resulting in what I believe could be air and water
pollution violations. I spoke to my state legislator at a community
town hall, and recently, I shared my concerns with a reporter. I think
my swine contractor knows I have spoken up to the government and the
media about the pollution. As my contract is nearing renewal time, if
my swine contractor proposes a less favorable formula for my hogs, is
this a violation under the Packers and Stockyards Act?
Answer: Possibly. PSD would investigate if the swine contractor was
retaliating against you based on concerns regarding redress of
grievances through governmental agencies or legislative
representatives, or with exercising freedoms of press or association,
regarding compliance with environment laws. As the December 2020 final
rule noted, ``Farmers have the right to file complaints regarding
wrongdoing, speak with media and elected officials, and form and join
farmer associations. If retaliation occurs, there is likely
discrimination, which may be unlawful under the P&S Act or other
laws.''
Further Engagement
Question: How do I report what I believe may be a violation of the
P&S Act?
Answer: PSD has a toll-free hotline that you can call to voice
complaints or concerns. You can make anonymous or confidential
complaints. Although you will need to leave your name and contact
information so that PSD can call you back, .PSD will not disclose the
name of a person who is complaining without the person's authorization.
The hotline number is 1-833-DIAL PSD (1-833-342-5773).
You can also contact the PSD Headquarters Office at (202) 720-7051
or [email protected], or any of the three PSD regional offices.
You can reach the Eastern Regional office at (404) 562-5840 or
[email protected], the Midwestern Regional Office at (515) 323-2579
or [email protected], or the Western Regional Office at (303)
375-4240 or [email protected].
Question: Where can I find more information about how the Packers
and Stockyards Act protects me? How can I offer views about what should
be done?
Answer:
For general information about P&S Act and regulations, you
can visit https://www.ams.usda.gov/services/enforcement/psd.
If you have a specific question, or wish to share your views
on regulations or on these FAQs, contact the Headquarters
Office at (202) 720-7051 or [email protected]. You may
also write to the Chief Legal Officer, Packers and Stockyards
Division, Rm. 2097-S, STOP 3601 1400 Independence Ave. SW,
Washington, D.C. 20250-3601.
USDA may update Packers and Stockyards Act FAQs from time to time.
Question 2. Mr. Secretary, I was glad to see USDA's press release
last week, outlining the gaps in USDA's previous COVID-19 aid, and
committing to distributing the new ``Pandemic Assistance for
Producers'' more equitably.
This issue is important to me--last Congress I introduced the Local
and Regional Farmer and Market Support Act (Local Farmer Act), which
would target COVID-19 aid directly to farmers of color and local and
regional food producers and markets as they cope with the economic
impacts of the coronavirus pandemic.
I'd like to hear more about what USDA is envisioning in terms of
its rules for new programs to ensure we're putting a greater emphasis
on outreach to small and socially disadvantaged producers, specialty
crop and organic producers. Is the agency considering setting-aside
portions of these relief funds for farmers of color?
Answer. Reaching beyond the traditional row crop producers to serve
the full set of potential USDA customers is a top priority. But it
isn't a simple task and will take time and a combination of actions.
The pandemic assistance program is a good example of the challenges
and opportunities. The first round of payments through the CFAP 1
program was well suited to USDA's traditional customers and crops, but
the program and rules were not tailored to all types of crops and
especially many specialty crops were excluded. The next round of
assistance, CFAP 2, did not include as many barriers for specialty
crops, smaller scale livestock or diversified producers. But solving
the eligibility issues were not enough to actually get underserved
producers enrolled, as the previous Administration failed to conduct
sufficient outreach to underserved producers.
The Biden-Harris Administration recognized the gaps and disparities
in the previous versions of pandemic assistance and re-opened the CFAP
2 program in April 2021 and set about conducting the outreach and
seeking partnerships with organizations serving underserved
communities. This concerted effort has shown results--the previous
Administration's sign-up only included 4% socially disadvantaged
producers (based on race and ethnicity), the new signup from April-July
saw this percentage increase to 11%, which further increased to 21% by
September.
USDA has been working to conduct broader outreach and establish a
technical assistance network from the start. It is important to
understand and acknowledge the additional hurdles faced by underserved
producers and also to ensure existing targeted programs reach those
they are intended to reach, whether they are limited resource,
beginning, veteran, or socially disadvantaged. We need to streamline
processes, build partnerships to help us examine how to make programs
work better for underserved producers, and ensure we reach all of our
eligible customers. It will also be critical to engage Congress and
this Committee on how to address barriers that exist in statute. I look
forward to working with you on this.
Questions Submitted by Hon. Bobby L. Rush, a Representative in Congress
from Illinois
Question 1. Would you expand upon the concrete steps you are taking
to foster trust and ensure the timely access to capital for Black
farmers? What is the timeline for implementing any new policies?
Question 2. Do you need any additional authorities from Congress to
enact policies to directly help struggling Black farmers and to reverse
the impact of decades of discriminatory practices at the USDA?
Answer 1-2. USDA is committed to the values of equity and inclusion
rooted in justice and equal opportunity for those we serve. We will
seek out opportunities within the Department that help ensure
historically underserved groups can more fully access and participate
in programs and services and build a workforce that is more
representative of America. USDA was provided over $1 billion from the
American Rescue Plan, which provides funds and direction for USDA to
take forward looking action to ensure historically underserved
communities have the tools, programs and support they need to succeed.
With these transformative funds, USDA will focus on creating
opportunity for historically underserved producers through technical
assistance and capacity building, access to land and credit, and access
to markets and market development. I look very forward to working with
you as we move forward in this important work.
Question 3. Secretary Vilsack, it is my understanding that there is
currently insufficient transparency regarding assistance to farmers
based on race. To that end, I would like to know:
Can you tell me the number of Black farmers who bought crop
insurance policies in 2019 compared to the number of white farmers?
Answer. USDA estimates that in 2019, 1,278 policyholders identified
as Black, whereas 415,944 policyholders identified as White.
Question 3a. Can you tell me how much Black farmers received in
premium or income support compared to white farmers?
Answer. USDA estimates that in 2019, $14.24 million in crop
insurance premium subsidy was provided to policyholders identifying as
Black, whereas $5.66 billion in premium subsidy was provided to
policyholders who identified as White.
USDA estimates that in 2019, farmers who identified as Black
received:
$15,142,361 in ARC-PLC payments.
$30,937 in Livestock Indemnity Program (LIP) payments.
$668,420 in Livestock Forage Program (LFP) payments.
$27,753,850 in Market Facilitation Program (MFP) payments.
$55,228,215 in CFAP payments (CFAP 1 and 2).
USDA estimates that in 2019, farmers who identified as White
received:
$5,716,721,856 in ARC-PLC payments.
$70,704,259 in Livestock Indemnity Program (LIP) payments.
$105,818,499 in Livestock Forage Program (LFP) payments.
$13,219,646,664 in Market Facilitation Program (MFP)
payments.
$26,486,468,319 in CFAP payments (CFAP 1 and 2).
Question 3b. Can you tell me how many Black farmers received farm
ownership or operating loans in 2019 compared to white farmers and how
much they each received?
Answer. USDA estimates that in 2019, farmers identifying as Black
received:
51 Direct Farm Ownership loans with a value of $9,564,170.
418 Direct Operating loans with a value of $19,796,537.
8 Guaranteed Farm Ownership loans with a value of
$3,603,590.
19 Guaranteed Operating loans with a value of $3,758,350.
USDA estimates that in 2019, farmers identifying as White received:
5,883 Direct Farm Ownership loans with a value of
$1,305,925,190.
15,971 Direct Operating loans with a value of $953,093,109.
3,599 Guaranteed Farm Ownership loans with a value of
$1,788,201,264.
3,426 Guaranteed Operating loans with a value of
$1,010,660,556.
Question 4. Given the decades of discrimination of Black farmers
that has led the vast majority to have to sell their farms, would you
support making data on subsidies and loans available to the public?
Answer. It is important that we identify ways to quantify the
impact of our efforts to root out systemic discrimination. With
appropriate protections of personal information and confidential
business information, sharing statistics may be appropriate. I would be
happy to discuss this further with you.
Question Submitted by Hon. Gregorio Kilili Camacho Sablan, a Delegate
in Congress from Northern Mariana Islands
Question 1. Pacific Islander farmers, like Black farmers, are
included in the definition of Socially Disadvantaged, but do not seem
to benefit from USDA funding streams like the Socially Disadvantaged
Farmers and Ranchers and Veteran Farmers and Ranchers group (2501
Program), why is that?
Answer. The Section 2501 program provides grants to nonprofit and
community-based organizations, universities, and tribal governments
that in turn provide outreach and technical assistance to socially
disadvantaged farmers and ranchers and veteran farmers and ranchers. As
you point out, Pacific Islanders and Black farmers and ranchers are
eligible beneficiaries of the program opposed to recipients of grant
funds. Individual farmers and ranchers are not eligible to compete for
this grant program but benefit from the expertise of the organizations
and higher education institutions in providing needed outreach and
technical assistance to the communities in need of such services. There
are other programs to directly assist individual farmers and ranchers
across the Department. Please visit: www.farmers.gov or www.usda.gov/
newfarmers.
As USDA commits to taking full stock of how socially disadvantaged
farmers and ranchers access our programs, we will be sure to evaluate
outreach to these communities and the groups that serve them to ensure
full understanding of eligibility, and how USDA can best help in
creating access. I would welcome working with your office to address
these challenges.
Question 2. The National Agriculture Statistics service recently
released the 2018 Census of Agriculture for the Northern Mariana
Islands.
How can that data be used to improve grant opportunities for the
Rural Development Service, the Natural Resource Conservation Service,
and the Farm Service Agency?
Answer. The Census of Agriculture is an important tool for USDA to
understand agricultural products throughout the United States and its
territories. USDA uses census data to understand agricultural
production and to provide a baseline for comparisons to identify trends
over the years. Having high quality data allows us to be able to
identify needs and gaps in services. It also allows for a baseline
understanding of potential damages from typhoons and other natural
disasters, helping farmers and ranchers justify loss claims. Having
uniform data also allows us to compare benefits and services we are
providing across territories and States, and as we continue to evaluate
how we can more equitably distribute USDA's grant resources.
Question 2a. Second, is the USDA willing to work with me and other
Congressional Delegates from the territories to clarify how money is
allocated and dispersed in the territories?
Answer. Yes, we are interested in learning more about the needs of
the citizens of the territories and how we can ensure they have access
to USDA's important services.
Question 2b. Third, while an Advisory Committee on Minority Farmers
exists under Section 2501 of the Food, Agriculture, Conservation and
Trade Act of 1990 and has goals to ensure socially disadvantaged
farmers have equal access to USDA program--no Pacific island states or
territories are represented on the Advisory Committee. Will the USDA
work towards creating parity for farmers in the Pacific to also serve
on the advisory committee on minority farmers?
Answer. The Section 2501 program requires stakeholder input,
including the Secretary's advisory committee on minority farmers. The
nomination process is currently in progress. We are working to identify
appropriate individuals for consideration on these important committees
to serve from each region of the United States.
Question 3. USDA Farm Service Agency (FSA) is considered a ``lender
of last resort.'' In FY 2017 `Native Hawaiian or other Pacific Island'
represented 0.2% of Direct Loans, and 0.1% of Guaranteed Loans. These
numbers represent the lowest percentages of use for USDA FSA loans,
what is the USDA doing to expand access to farmers in the Pacific,
specifically in the Northern Mariana Islands?
Answer. We want all farmers to have equitable access to USDA's
important services. As we evaluate how and where we can do better, we
will examine these issues and make specific recommendations to address
how to improve access to farmers in the Pacific.
Question 4. Relating to USDA COVID-19 Relief, the Coronavirus Food
Assistance Program (CFAP) was designed to bolster the farm economy, but
Pacific Islanders present 0.01% of MFP payments, compared to 26.53%
among white farmers, and 0.08% among Black Farmers. Sections 1005 and
1006 of the American Rescue Plan provide targeted and tailored support
during the pandemic for socially disadvantaged farmers, including
pacific islander farmers, what is the USDA doing to increase awareness
of this funding stream for farmers in the pacific and in the Northern
Mariana Islands?
Answer. A key part of our efforts at ensuring equity in everything
USDA does is ensuring that we improve outreach to disadvantaged
producers so that they understand the range of services we provide. We
are committed to working with you and community organizations who
understand the unique needs of disadvantaged producers to ensure that
farmers in the Pacific are aware of and can access USDA services.
Question 5. Under the recently enacted American Rescue Plan Act of
2021 there is funding available to create ``equity commissions that
will address racial equity issues within the Department of Agriculture
and its program,'' what will the USDA do to involve pacific island/
indigenous farmers in these efforts?
Answer. The equity commission will be an important part of our
efforts to ensure that all have access to USDA's programs and services,
particularly by dismantling barriers historically underserved
communities have faced, including pacific island/indigenous farmers.
The commission will reflect a wide range of perspectives through its
diverse membership from those whose mission is to serve or advocate for
underserved communities, minorities, women, individuals with
disabilities, individuals with limited English proficiency, rural
communities, and LGBTQI+ communities. I will ensure that its efforts
take the needs and perspectives of Pacific Island and indigenous
farmers into account.
Question Submitted by Hon. Michelle Fischbach, a Representative in
Congress from Minnesota
Question. Secretary Vilsack, your testimony in the hearing touched
on the availability of land and credit to start a new operation or to
continue a family tradition in farming. This is an important part of
larger critical issue, where our next generation of farmers are going
to come from. In terms of continuing the family tradition, I'm hearing
consistently from constituents in my district about the Biden
Administration's proposals to change the calculation of basis for the
purpose of capital gains tax. Known as ``stepped-up basis'', a capital
gains tax is currently assessed on the present value of an asset less
the value at the time of death or at the transfer to the farmer that is
being taxed, as opposed to when the property was acquired or inherited.
This is important for lessening the burden of a the passing down of
multi-generational farms as otherwise, that transfer takes on a
dramatic tax liability through capital gains, even in cases with no
intention of realizing the gain from when the asset was originally
acquired. My constituents are concerned that the Biden Administration
will eliminate this stepped-up basis, along with an increase in the
capital gains tax rate in an upcoming tax proposal.
Can you confirm whether this proposal is being considered and, if
so, how this change would affect the ability for farms to be passed
down to future generations including in socially disadvantaged
communities?
Answer. The President's American Families plan includes critical
tax reform to ensure that the wealthy pay their fair share of taxes to
finance essential investments in workers and families, including
childcare, nutrition, higher education and more. One of those reforms
includes a proposal to close the ``stepped-up basis'' loophole for
wealthy estates so that large fortunes do not escape taxation. The
proposal protects family farms, exempting farms that stay in the
family.
Response from John W. Boyd, Jr., Founder and President, National Black
Farmers Association *
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* There was no response from the witness by the time this hearing
was published.
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Question Submitted by Hon. Jim Costa, a Representative in Congress from
California
Question. As of 2017, 48 percent of farms operated by Black
producers specialized in cattle production. Mr. Boyd, you mentioned
that you raise beef cattle, alongside growing soybeans, wheat, and
corn. How has been your experience been in the marketplace as a Black
livestock producer and has that experience been similar or different to
the other commodities you grow? How can USDA better support livestock
producers color?
Answer.
Question Submitted by Hon. Alma S. Adams, a Representative in Congress
from North Carolina
Question. In the American Rescue Plan, Congress provided for new
equity commissions to address racial discrimination at the USDA.
We need individuals on that commission who bring fresh eyes to the
problems at USDA and can speak to the barriers faced on small and
beginning farms.
Mr. Boyd, what are your thoughts on how to best set up the
commission to be effective?
Answer.
Response from Sedrick Rowe, Owner/Operator, Rowe Organic Farms LLC *
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* There was no response from the witness by the time this hearing
was published.
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Question Submitted by Hon. Jim Costa, a Representative in Congress from
California
Question. Mr. Rowe, earlier in this hearing I shared with Secretary
Vilsack how Black farmers in California don't trust USDA for loans and
other services. You mentioned how community organizations helped you
mitigate the lack of trust between USDA and Black farmers.
How did these organizations help mitigate the trust gap and
advocate for you at USDA?
Answer.
Question Submitted by Hon. Ann Kirkpatrick, a Representative in
Congress from Arizona
Question. Ms. Kirkpatrick. . . .
My second question is for Mr. Rowe. I am inspired by your testimony
today and by your decision to become a first-generation farmer.
Further, I can only imagine the difficulty in not only starting a farm
completely from scratch, but going through the process to ensure you
are producing organic crops.
From my conversations with farmers back home, I know that going
through the organic certification process is something that scares a
lot of farmers off, or they don't know where to start, even if they are
already operating under USDA organic practices. Can you describe for us
some of the reasons you chose to produce organically, and if you see an
opportunity to help more Black farms through the USDA organic
certification?
The Chairman. I am going to have to ask if you might be kind enough
to reply in writing. We are way past the time. I deeply appreciate your
consideration. We want to get every Member in this important hearing.
Answer.
Response from Shirley Sherrod, Executive Director, Southwest Georgia
Project for Community Education, Inc.
Question Submitted by Hon. Jim Costa, a Representative in Congress from
California
Question. Ms. Sherrod, your testimony reflected many of the same
things the Black farmers in my district shared.
You mentioned that Black farmers need to be able to market their
products and not be limited to any one market and that they have to be
able to diversify their markets. As Chairman of the Subcommittee on
Livestock and Foreign Agriculture, I'm especially interested in making
sure we are expanding international markets for producers of color, in
addition to domestic markets.
What are 2-3 things that USDA can do to help producers to diversify
their markets?
Answer. When Black farmers are assured access to capital as well as
technical assistance--for the most part, they are able to produce a
quality product. The issue then becomes marketing. Most Black farmers
depend on one or more of the following: (1) local markets, (2)
farmers['] markets, (3) commercial markets through a middle person.
These markets tend not to be stable and the volume is limited. What
Black farmers need is a marketing system that they can control--a
system that enables them to participate in local, regional, national
and international markets. A system that also allows them to develop
long-term mutually beneficial relationships within the global marketing
arena.
The key to this participation is a farmer owned and operated
infrastructure that will include:
Strategically placed processing/valued facilities.
Refrigerated trucks.
Strategically placed aggregation centers.
This cannot be a short-term commitment by the USDA nor Black
farmers and the institutions that support. I think it will require
several meetings between USDA and key partners to develop a
comprehensive strategy and timeline.
[all]
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