On August 16, 2022, President Joseph Biden enacted the Inflation Reduction Act of 2022. The Inflation Reduction Act (IRA) repealed Section 1005 and Section 1006 of the American Rescue Plan Act (ARPA), reallocated the 5 billion dollars that had been designated to assist socially disadvantaged farmers and ranchers of color, and created two new United States Department of Agriculture financial assistance programs, one for distressed borrowers and another for borrowers who experienced discrimination in lending.
On July 7, 2023, the United States Department of Agriculture (USDA) announced the opening of the USDA Discrimination Financial Assistance Program (DFAP). DFAP was created by Section 22007 of the Inflation Reduction Act (IRA). It is a financial assistance program for farmers, ranchers, and forest landowners who experienced discrimination in USDA farm lending programs. 2.2 billion dollars of “discrimination financial assistance” is available to farmers, ranchers, and forest landowners who can prove they experienced discrimination by USDA in its farm loan programs prior to January 1, 2021, and to farmers, ranchers, and forest landowners who were assigned or assumed (inherited) USDA farm loan debt that was the subject of USDA discrimination that occurred prior to January 1, 2021.
The Discrimination Financial Assistance Program covers both USDA direct and guaranteed lending through USDA’s Farm Service Agency and its predecessor, the Farmers Home Administration; however, only discrimination by USDA personnel in USDA lending is covered. Discrimination by a non-USDA lender does not qualify for DFAP. Discrimination is based on different treatment experienced because of race, color, national origin, ethnicity, sex, sexual orientation, gender identity, religion, age, marital status, disability, and reprisal or retaliation for prior civil rights activity. Discrimination may be experienced in a myriad of ways; however, some examples include:
1. Failure to provide appropriate assistance.
2. Delaying the loan process or a loan servicing application.
3. Denial of a loan or loan servicing.
4. Prevention from applying for a loan or loan servicing.
5. Adverse loan terms.
6. Unduly onerous supervision of loan requirements.
The discrimination must have caused a loss such as: loss of agricultural land; loss of home used as collateral for a loan, loss of money from offsets, garnishments, or deficiency judgments because of a USDA loan default or USDA foreclosure. Eligible farm loan programs include:
1. Farm Ownership Loans
2. Farm Operating Loans
3. Microloans
4. Youth Loans
5. Farm Storage Facility Loans
6. Emergency Loans
7. Economic Emergency Loans
8. Emergency Livestock Loans
9. Soil and Water Loans
10. Conservation Loans
11. Softwood Timber Loans
12. Grazing Loans
The maximum amount an applicant can be awarded is $500,000. The award amounts will vary, and most applicants will most likely be awarded an amount significantly less than $500,000. Successful applicants can expect to receive payments no later than early 2024.
The application process opened on July 7, 2023. Applications are currently being accepted. The application is FREE and are available online at https://www.22007apply.gov in English and Spanish. There are three ways to apply. Applicants can submit an electronic application online; or mail a paper application by U.S. or overnight mail; or apply in-person by delivering a paper application to a local office. Submitting applications online is the fastest and easiest way to file. All applications must be submitted by October 31, 2023.
1. Electronic applications must be submitted online at https://www.22007apply.gov
by 11:59 PM Pacific Time on October 31, 2023.
2. Paper-based applications submitted by U.S. or overnight mail must be postmarked
no later than October 31, 2023.
3. Paper-based applications submitted in-person at a local office must be delivered
by 8 PM local time on October 31, 2023. USDA DFAP local offices and office hours
can be found at https://www.22007apply.gov.
All applications received by the deadline will be reviewed and considered. Applications submitted after the deadline will not be reviewed and will not receive financial assistance. There will be no extensions. USDA aims for applications to be processed by the end of 2023.
The United States Department of Agriculture contracted three vendors: Midtown Group, Windsor Group, and Analytic Acquisitions. The vendors are to provide eligible farmers, ranchers, and forest landowners information about DFAP, assist them with completing applications, and determine which applicants should be awarded financial assistance. Midtown Group is the national administrator and will manage all aspects of the application process. Windsor Group and Analytic Acquisitions are the regional hubs. They will open locations throughout the nation to conduct outreach, to provide assistance, and to make application recommendations. The vendors are available to assist with:
1. Completing and filing applications electronic and paper-based applications.
2. Checking the status of applications.
3. Assisting applicants to submit scanned copies of documentation.
4. Providing interpretation and translation services.
The Discrimination Financial Assistance Program is a USDA program. It is not affiliated with any lawsuits, past or present. There will be no hearings or appeals. There are no courts involved in the process. Applicants should beware of scams. There are some lawyers, law firms, and groups spreading misleading information about the program and its process. Again, the application is free. There is no cost to file an application. Applicants do not need to hire an attorney. Applicants should not enter into agreements with any lawyer, law firm, individual, or entity which requires payment in exchange for assistance. FREE technical assistance is available to applicants to complete applications.
The United States Department of Agriculture has partnered with groups that have extensive experience conducting outreach to farmers, ranchers, and forest landowners. Applicants may contact the following organizations for information and assistance: AgrAbility, the Farmer Veteran Coalition, Farmers’ Legal Action Group, the Federation of Southern Cooperatives, the Intertribal Agriculture Council, Land Loss Prevention Program, National Young Farmers Coalition, and Rural Coalition. Furthermore, telephone assistance is also available. Live agents are available to answer questions about applications at 1-800-721-0970, from 8 AM Eastern Time to 8 PM Pacific Time seven days a week, except for federal holidays. In addition, the Southern University Law Center Agricultural Law Institute for Underrepresented and Underserved Communities is available to provide FREE assistance to farmers, ranchers, and forest landowners who desire to apply for DFAP funds, email ALI@SULC.EDU for more information.