Judge suspends race-based farm debt payments

A federal judge issued a ruling June 10 that halted the Joe Biden administration’s plan to make agricultural loan debt payments to “socially disadvantaged” farmers using race as the criterion for eligibility. The ruling came in response to a suit filed by 12 plaintiffs from several states represented by the Wisconsin Institute for Law and Liberty alleging that the set-asides unconstitutionally discriminated on the basis of race. The plaintiffs farm in Minnesota, South Dakota, Missouri, Iowa, Arkansas, Oregon and Kentucky.

As part of the $1.9 trillion American Rescue Plan Act of 2021 passed by Congress and enacted March 11, Congress set aside about $4 billion to pay off up to 120% of U.S. Department of Agriculture farm loan modifications and loans to “socially disadvantaged” farmers.

The program was designed, say its promoters, to compensate for past effects of discrimination that disadvantaged farmers of color. On the website dedicated to the American Rescue plan, those eligible for loan relief are defined as “one or more of the following: Black or African American, American Indian, Alaskan native, Hispanic or Latino, Asian, or Pacific Islander.” About 17,000 farmers from all 50 states qualify for the debt forgiveness program.

Some of the money has already been distributed; plaintiffs sought an emergency injunction to halt the program before the rest of the money was distributed. United States District Judge William Griesbach, a George W. Bush appointee, wrote that an emergency injunction was justified because plaintiffs were likely to suffer harm from the program, and they were likely to prevail on the merits in a full hearing. “Though defendants assert that Section 1005 is intended to help socially disadvantaged farmers affected by COVID-19, it does not provide relief based on losses sustained during the pandemic. Instead, the only consideration in determining whether a farmer or rancher’s loans should be completely forgiven is the person’s race or national origin.”

Griesbach said that based on the law and past precedents, any laws purporting to remedy past discrimination must meet a three-pronged test. First, they must target a specific episode of past discrimination, not just assert generalized discrimination. Second, the discrimination must be shown to have been intentional. Third, the government “must have had a hand” in the discrimination it seeks to remedy.

“The obvious response to a government agency that claims it continues to discriminate against farmers because of their race or national origin is to direct it to stop,” wrote Griesbach. “It is not to direct it to intentionally discriminate against others on the basis of their race and national origin.”

Through a spokesperson, the USDA said, “We respectfully disagree with this temporary order and USDA will continue to forcefully defend our ability to carry out this act of Congress and deliver debt relief to socially disadvantaged borrowers. When the temporary order is lifted, USDA will be prepared to provide the debt relief authorized by Congress.”

David Murray can be reached at [email protected].