Last month, the USDA announced it will begin loan payments to minority farmers through the Emergency Relief for Farmers of Color Act. However, a federal judge just issued a temporary restraining order which would halt those payments.
On Thursday afternoon, a temporary restraining order was announced by Judge William Griesbach of Wisconsin’s Eastern District in response to a lawsuit that was filed last April by Wisconsin Institute for Law & Liberty (WILL). A group of farmers filed the lawsuit in federal court challenging the unconstitutional race discrimination in the American Rescue Plan Act’s provision to offer loan forgiveness based on racial categories.
The direct farm loan payments in question were made available by the Emergency Relief for Farmers of Color Act, which was a piece of the American Rescue Plan Act, the most recent coronavirus relief package. That included $4 billion in debt relief for minority farmers (along with an additional $1 billion in other aid). The USDA planned for payments to begin in early June and continue on a rolling basis.
After the USDA announced that it would begin forgiving loans in June, and would do so quickly, WILL moved for a preliminary injunction and an immediate, temporary restraining order until the Court could rule on the preliminary injunction. The Court granted a temporary restraining order, prohibiting USDA from forgiving any loans on the basis of race until the Court rules on the preliminary injunction.
After the judge halted these payments, WILL President and General Counsel, Rick Esenberg said, “The Court recognized that the federal government’s plan to condition and allocate benefits on the basis of race raises grave constitutional concerns and threatens our clients with irreparable harm. The Biden administration is radically undermining bedrock principles of equality under the law. We look forward to continuing this litigation but urge the administration to change course now.”
The Emergency Relief for Farmers of Color Act directs the Secretary of Agriculture, Tom Vilsack, to “pay to each lender of farm loans guaranteed by the Secretary an amount equal to the principal and interest outstanding as of the date of enactment of this Act on all farm loans held by the lender, the borrowers of which are socially disadvantaged farmers and ranchers, such that the borrowers shall be relieved of the obligation to repay the principal and interest due on those guaranteed farm loans.”
However, the Midwest plaintiffs believe they are also being discriminated against as well. The lawsuit states, “Were plaintiffs eligible for the loan forgiveness benefit, they would have the opportunity to make additional investments in their property, expand their farms, purchase equipment and supplies, and otherwise support their families and local communities. Because plaintiffs are ineligible to even apply for the program solely due to their race, they have been denied the equal protection of the law and therefore suffered harm.”
In total, WILL represents twelve farmers and ranchers from Wisconsin, Minnesota, South Dakota, Ohio, Missouri, Iowa, Arkansas, Oregon, and Kentucky.