Debt Payments for Socially Disadvantaged Producers
The American Rescue Plan Act Section 1005 includes provisions for USDA to pay up to 120% of loan balances, as of January 1, 2021, for Farm Service Agency (FSA) Direct and Guaranteed Farm Loans and Farm Storage Facility Loans to any Socially Disadvantaged producer who has a qualifying loan with FSA. This includes producers who are one or more of the following: Black/African American, American Indian, Alaskan Native, Hispanic/Latino, Asian American, or Pacific Islander. The American Rescue Plan Act uses Section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 as the definition of Socially Disadvantaged farmers and ranchers.
The 120% payment represents the full cost of the loan to include 100% toward loan balances as of January 1, 2021, and the 20% portion is available for tax liabilities and other fees associated with payment of the debt. Any payments by borrowers made since January 1 will be reimbursed in full.
How to Participate
Eligible Direct Loan borrowers will begin receiving debt relief letters from FSA in the mail on a rolling basis, beginning the week of May 24. Information for Guaranteed Loan borrowers will be available within 120 days.
After reviewing closely, eligible borrowers should sign the letter when they receive it and return to FSA. FSA employees will assist borrowers with their questions free of charge and will help producers complete any required documents. USDA will collaborate with community-based organizations and universities on outreach, technical assistance, and providing borrowers with access to financial, legal, and tax planning services. details about how to request a meeting with FSA are in each letter.
If you’re uncertain of your demographic designation on file at FSA, you can contact your local service center to verify your classification on record. If an update or correction is needed, you may either fill out USDA Form AD-2047 or work with your local service center to update your record, including race and ethnicity.