The USDA has issued payments to 43,000 persons, most in Mississippi and Alabama, who completed applications detailing how they experienced discrimination in the Agriculture Department’s lending programs before January 2021.

A total of 13,283 residents of Mississippi received $521,830,460 under Section 22007 of the Inflation Reduction Act’s Discrimination Financial Assistance Program. In Alabama, 10,907 applicants received payments of $383,704,620.

“More than 23,000 awards or about 54% went to applicants who had or have farming or ranching operations,” the USDA said in a breakdown of the payments on the Discrimination Financial Assistance Program website. “They received a total of about $1.9 billion, with individual awards ranging from $10,000 to $500,000, with an average of nearly $82,000.

“Over 20,000 awards or about 46%, were to applicants who planned to have farming or ranching operations but were unable to establish them because of USDA actions. They received a total of $101 million with individual awards ranging from $3,500 to $6,000.”

Southern payouts

In Mississippi, 5,892 awards were made to farmers who have or had operations, and 7,391 to individuals who tried to begin farming but could not do so because of the USDA’s actions. In Alabama, 6,494 awards were made to farmers who were in business now or at one time and 4,413 to those who never made it into farming.

Related:USDA receives 58,000 requests for discrimination assistance

“We are excited that the payments have gone out to help farmers during this economic hardship,” said John Boyd Jr., president of the National Black Farmers Association, and a farmer in Virginia. “Farmers are struggling with the high cost of diesel, fertilizer, seed and equipment while battling extreme heat, drought and intensive storms, and they need help.”

Boyd, a fourth-generation farmer, recalls that the first time he applied for a loan with the USDA’s Farmers Home Administration, the predecessor to today’s Farm Service Agency, the loan officer tore up his application and threw it in the waste basket.

While awards were made in all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands and American Samoa, the lion’s share of the payments went to southern states and Oklahoma and Texas.

The next highest number of awards to both categories of farmers were 2,926 in Oklahoma, 2,170 in Georgia, 1,584 in Tennessee, 1,456 in Arkansas, 1,376 in North Carolina, 1,369 in South Carolina, 1,311 in Texas, 1,265 in Louisiana and 1,059 in California.

The USDA vendors received 58,000 applications during signup for the program, which ran from July 7, 2023, to last Jan. 17. Section 22007 of the Inflation Reduction Act required the USDA to contract with outside entities to conduct the signup and the review of the applications.

Related:Black Farmers call for Vance apology on farm benefit comments

Applicant help

The DFAP application put together by the vendors was 40 pages. Organizations such as the National Black Farmers Association and the Southern Federation of Cooperatives conducted dozens of educational sessions to help applicants understand the process.

“Farmers and ranchers work around the clock to put food on our tables and steward our nation’s land. But for too long, many farmers and ranchers experienced discrimination in farm loan programs and have not had the same access to federal resources and support,” said President Joe Biden in a press release issued by the USDA.

“I promised to address this inequity when I became president. Today that promise has become a reality. My Inflation Reduction Act took a bold step to address the effects of discrimination in farming and ranching, and today’s action will enable more farmers and ranchers to support themselves and their families, help grow the economy and pursue their dreams.”

Agriculture Secretary Tom Vilsack said the completion of the Discrimination Financial Assistance Program is an important moment in the USDA’s history.

“While this financial assistance is not compensation for anyone’s losses or pain endured, it is an acknowledgement,” Vilsack said. “My hope is that this will ensure that many farmers can stay on their farms, contribute to our nation’s food supply, and continue doing what they love.”

 Boyd said, “The payments will not bring back lost land, but it will help farmers move ahead with their operations. We are still hopeful farmers of color will receive the 120% debt relief from signed contracts under the American Rescue Plan Act Section 1005.”

The American Rescue Plan Act’s Section 1005 would have paid 120% of the direct and guaranteed loan outstanding balances of social disadvantaged farmers and ranchers for certain types of loans.

The Section was struck down by a federal judge after farmers in Texas filed a lawsuit claiming the law was unconstitutional because it discriminated against white farmers. The section was later repealed by the Inflation Reduction Act.