Debt relief promised, some black farmers receive collection notices

Despite attempts to clear up the confusion, the USDA letters caused confusion and distress among borrowers.

“It’s very confusing for the farmers, and they needed a lot of information from our offices because they were told one thing, and then they get documents that say something else,” said Dãnia Davy, director land retention. and advocacy with the Federation of Southern Cooperatives/Land Assistance Fund. “It’s just not very clear to farmers what their obligations are.”

The USDA’s suspension of debt collections, foreclosures and other adverse actions is expected to continue while the national COVID-19 disaster declaration is in place, which is now set to expire on March 1. But data the Center for Public Integrity obtained through a freedom of information law request suggests the department has continued to collect eligible debts.

The USDA did not respond to requests for comment.

Is the USDA seizing profits?

The USDA offers two types of loans. Direct loans are made between the Agricultural Services Agency and the borrower. Secured loans are made by a traditional lender but backed by the Farm Service Agency. Both programs are for borrowers who cannot obtain reasonable credit terms elsewhere.

In January 2021, the USDA suspended debt collection and seizures on direct loans. He asked agency-backed lenders to follow his lead, but they are not bound by USDA policy.

Despite the suspension, the USDA collected about $538,000 in debt from Feb. 1 to Nov. 25, 2021, according to data the Center for Public Integrity obtained through a Freedom of Information Act request. About 16.1% of those funds were raised from people of color.

The USDA told Public Integrity it needed to clarify some of the data, but offered no information, including an answer to specific questions such as why debt set-offs and wage garnishments appear to have continued. after the USDA. announcement their suspension.

Meanwhile, a coalition of groups representing farmers and ranchers of color is trying to find out if farmers will see similar collections following the suspension of the debt relief program, but that’s a tough question to answer. , Davy said. Based on conversations with USDA officials, she thinks they’re trying to be optimistic about the program still moving forward.

“I think they don’t want to concede any negative results pending litigation,” Davy said. “I think they’re hoping there are other ways around this scenario of massive foreclosures and loss of land.”

As for Denver, its next USDA loan payment is due in the coming months. It will restart the payments even if they are not needed. He doesn’t want to fall any further behind.

“I work too hard to get where I am,” Denver said. “I’m not going to give my land to these people because you promised me something, and you’re not keeping your end of the bargain.”

This story was produced in partnership with the McGraw Business Journalism Center to Craig Newmark Diploma City School of Journalism University of New york.

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