Inflation Reduction Act Funds Targeted Toward Struggling Farmers
USDA using dollars to pay off loans, keep farmers in business
By Julian Emerson
Communications Specialist, Wisconsin Farmers Union
Farmers in Wisconsin and elsewhere across the country who face losing their farms because of financial struggles are receiving help through the Inflation Reduction Act (IRA) to stay in business.
According to recently released statistics from the United States Department of Agriculture (USDA), farmers facing significant financial struggles who have qualifying USDA farm loans have received about $800 million in IRA assistance, part of the $3.1 billion for distressed farm loan borrowers made available as part of that legislation.
Through IRA money, the USDA has paid off farm-related debts for approximately 11,000 farmers whose loan payments were delinquent. IRA dollars also paid the next loan payments for those lenders, giving them a financial cushion going forward.
In addition, IRA funds were used to resolve debts for about 2,100 farmers whose farms were previously foreclosed on and who still had debt remaining.
“Through no fault of their own, our nation’s farmers and ranchers have faced incredibly tough circumstances over the last few years,” Agriculture Secretary Tom Vilsack said in a press release. “The funding included in today’s announcement helps keep our farmers farming and provides a fresh start for producers in challenging positions.”
USDA officials are using an additional $500 million to provide additional assistance to farm loan borrowers. The agency is administering $66 million made available through coronavirus pandemic relief funds to support as many as 7,000 loan borrowers who used the federal Farm Service Agency’s disaster set aside option – which moved payments to the end of their loan periods – during the pandemic.
USDA is also providing financial assistance to another 1,600 farmers who face bankruptcy or foreclosure. Additionally, the agency is helping another 14,000 borrowers who face financial pressures, a move designed to prevent them from going bankrupt.
More details on each of the categories of assistance and who is eligible to receive help are available on the Inflation Reduction Act webpage on farmers.gov. Additional efforts to help farmers facing financial challenges through the IRA are planned in the future, USDA officials said.
That assistance will be critical to farmers in Wisconsin and elsewhere across the nation who have been struggling for years and were especially hit hard financially during the pandemic, National Farmers Union President Rob Larew said.
“Let’s be clear, this debt relief is going to help keep family farms in business, not just for this generation but for generations to come,” Larew said. “It’s promising to see how USDA is implementing provisions of the Inflation Reduction Act that will help thousands of distressed loan borrowers.”
U.S. Sen. Tammy Baldwin, a Wisconsin Democrat, said the portion of IRA funding that helps farmers facing financial struggles is critical to maintaining and strengthening rural America.
“Farmers are really the roots of our rural communities,” Baldwin said during a recent visit to Eau Claire. “Keeping them in business, and creating conditions for them to succeed, will help preserve and build our rural communities.”
The IRA was approved by Congress and signed into law by President Joe Biden on Aug. 16. The measure, the largest single investment to address climate change in U.S. history, invests about $300 billion toward deficit reduction to curb inflation and another $369 billion in programs to bolster energy security and programs to address climate change during the next 10 years.
USDA provides credit access to about 115,000 producers who can’t obtain sufficient commercial credit through direct and guaranteed farm loans. In January 2021, USDA officials suspended foreclosures and other actions on direct farm loans because of the pandemic. The agency encouraged other lenders to do the same.