September 14, 2022

Gillibrand Calls On Biden Administration To Swiftly Implement Debt Relief Provisions For Small Farmers Passed In The Ira

New York Is Home To More Than 30,000 Farms; Inflation Reduction Act Will Provide Desperately Needed Debt Relief To Struggling Farmers; As of 2019, New York Farmers Held More Than $160 Million In Debt

Today, U.S. Senator Kirsten Gillibrand held a video press conferencing announcing her letter to U.S. Department of Agriculture (USDA) Secretary Tom Vilsack urging the USDA to quickly implement the small farmer debt relief provisions in the recently passed Inflation Reduction Act. The historic bill includes $3.1 billion in economic relief for struggling farms, but without rapid distribution of funds, farmers burdened by loans will continue to struggle to make ends meet. Gillibrand sent this letter with U.S. Representative Sean Patrick Maloney (NY-18). The members are calling on the USDA to immediately clarify eligibility guidelines for debt relief and provide relief to as many economically distressed small farmers in New York State as possible. 

“The Inflation Reduction Act takes critical steps to help relieve small farmers’ crushing debt, but they can’t afford to wait weeks or months for relief,” said Senator Gillibrand. “I urge Secretary Vilsack to act now to clarify the eligibility guidelines for debt forgiveness so that farmers can get the help they need as soon as possible. Small farmers form the backbone of our rural communities and we have to do more to ensure that they have the support they need to stay in business.” 

“Small family farmers like those in the Black Dirt region of the Hudson Valley are pillars of our communities and the backbone of America’s agricultural industry. Despite their critical importance, small farmers face more challenges than ever and have often been forced to take on unrealistic amounts of debt to keep their farms operational. That’s why I’ve been working directly with farmers across the Hudson Valley to ensure they get the help they need to continue their work for generations to come,” said Representative Maloney. “Today, Senator Gillibrand and I called on the US Department of Agriculture to promptly distribute the billions in debt relief we fought for in the Inflation Reduction Act to as many small farmers in New York as possible. This funding will be life-changing for Hudson Valley farmers.”

As it currently stands, the USDA needs time to design and implement a debt relief program, including the eligibility criteria. Until the program is in place, economically distressed farmers will continue to need to make loan payments, putting them at risk of defaulting or being forced to sell their farms. Gillibrand and Maloney are urging the USDA to base the eligibility criteria for IRA forgiveness on the framework included in their bill, the Relief for America’s Small Farmers Act, which Gillibrand and Maloney introduced last year. The bill defines eligible borrowers as those who had an average annual adjusted gross income of $300,000 or less for the previous 5 years and was created to capture as many economically distressed farmers as possible. Using these criteria would help ensure that all farmers in need of debt relief get it soon. 

The full text of the letter is available here or below: 

Dear Secretary Vilsack,

The Inflation Reduction Act (IRA) will deliver billions of dollars in resources to help fight inflation, reduce healthcare costs, and notably provide relief to economically distressed farmers. Section 22006 of the IRA grants the U.S. Department of Agriculture broad authority to provide debt relief to at-risk famers, but many farmers are concerned as to whether they will be able to access these resources. We urge you to quickly implement the small farm debt relief program in a way that ensures as many small farmers as possible are included in this necessary relief, consistent with our original legislation.

As staunch advocates for farmers across New York State, we introduced the Relief for America’s Small Farmers Act and have worked tirelessly to ensure that financially distressed small farmers can obtain the relief they need to continue the essential work critical to our economy and many local communities. Language from the Relief for America’s Small Farmers Act was even included in the House-passed Build Back Better Act and provided up to $150,000 in relief to small farmers with Farm Service Agency (FSA) loans. The eligibility criteria for IRA forgiveness should be based upon the framework included in the Relief for America’s Small Farmers Act, which defined eligible borrowers as those who had an annual adjusted gross income under $300,000 for the previous 5 years. This criteria was specifically created to capture as many economically distressed farmers as possible and should be used as the framework of IRA implementation. We know firsthand the diligent work it took to include this incredible relief in the IRA, and we want to ensure that it will reach all farmers for whom the program was designed.

This debt relief program will help thousands of farmers across the country. The USDA needs time to design and implement the program; however, many farmers have loan payments due before the end of the year that they will not get back even though their loans will be forgiven once the debt relief program is implemented. Many farmers are struggling to complete their payments as it stands but have not yet defaulted, and they deserve to be included within USDA regulations. Therefore, we urge the USDA to establish a dedicated program for farmers who will qualify for this program for the 2022 season and to expeditiously issue the criteria and eligibility guidelines.

We have heard stories from many farmers across New York struggling to make ends meet or considering selling their farm because of their debt. The inclusion of this debt relief in the IRA has the potential to prevent this and help thousands of families in our state. We must ensure that small farmers will not be left out of this process or forced to wait for additional rounds of assistance that may not come. We wrote the original legislation to target all small farmers who are saddled with burdensome FSA loans, and we hope you will honor that intent as the USDA works on guidance for this debt relief program. While we understand the importance of helping our most at-risk farmers, it is imperative that USDA take into consideration economically distressed farmers who are on the brink of defaulting.

Our offices stand ready and eager to work in partnership to ensure we can do the most good for the most people with the resources allotted for this program. Thank you for your attention to this matter and we look forward to your response.

Sincerely,