Democrats add farm debt relief to climate finance as Senate move nears | 2022-08-06
A revised climate finance package that Democrats are pushing through the Senate this weekend cancels a debt relief program for minority farmers that was blocked by the courts and replaces it with new programs for borrowers in the USDA “distressed” as well as farmers the department has discriminated against.
The new version of the bill, dubbed the Inflation Reduction Act, earmarks $3.1 billion to help struggling holders of secured and direct loans.
An additional $2.2 billion would be provided for payments of up to $500,000 each to farmers who “experienced discrimination” before January 1, 2021 under USDA agricultural loan programs. Payments would be based on the “consequences of discrimination”.
The original debt relief package that was part of the US bailout that Democrats forced on Congress in 2021 offered payments worth 120% of a minority farmer’s loan balance. Several judges have ruled that basing loan forgiveness on a farmer’s race is unconstitutional.
The USDA would have until fiscal year 2031 to use the new funding.
The legislation cleared a key hurdle on Saturday night when Vice President Kamala Harris broke a 50-50 tie to submit the revised text for debate. A final vote was not expected until Sunday morning after debate on a series of largely token votes on the GOP amendments.
“This is one of the most comprehensive and impactful bills Congress has seen in decades: it will reduce inflation, it will reduce the cost of prescription drugs, it will fight climate change, it will will close the tax loopholes and it will reduce – reduce – the deficit,” said Senate Majority Leader Charles Schumer, DN.Y. Republicans countered that the bill would do next to nothing to reduce inflation and would impose new taxes that would indirectly hurt middle-class Americans.
The legislation, which represents a major victory for President Joe Biden’s goal to halve U.S. greenhouse gas emissions by 2030, includes more than $20 billion to expand the adoption of climate-related agricultural practices, plus an additional $20 billion in USDA-managed energy and forestry programs.
The bill’s clean energy tax incentives include a new clean fuel tax credit for low-carbon biofuels.
Western state Democrats also secured in the revised bill $4 billion in funding for the Bureau of Reclamation to help water users deal with the impact of the drought.
The revised bill also replaces some other US bailout aid for underserved farmers.
The provisions would provide $125 million for outreach, mediation, financial training and other assistance on “matters relating to food, agriculture, agricultural credit, agricultural extension, rural development or nutrition for underserved farmers, ranchers or forest owners, including veterans, with limited resources”. beginning producers, farmers and herders, and farmers, herders and forest owners living in an area of great poverty.
The bill would provide an additional $250 million in grants and loans to organizations that help improve access to land for underserved farmers, ranchers and forest owners.