DEMANDS OF THE LATINO/HISPANIC FARMERS AND RANCHERS

 

THE BASIC DEMAND

 

            THAT USDA IMMEDIATELY UNDERTAKE GOOD FAITH NEGOTIATIONS WITH COUNSEL FOR LATINO/HISPANIC FARMERS AND RANCHERS SEEKING A MUTUALLY ACCEPTABLE SETTLEMENT.

 

Point One:    Pendency of the Love and Keepseagle cases and the continuing unhappiness with the Pigford settlement, are reasons why USDA should act boldly and quickly to engage in discussions with Garcia representatives because a successful resolution in Garcia could easily provide the model for a global resolution of all pending producer class actions, including issues lingering in the aftermath of Pigford.

 

Point Two:    Efforts and resources expended by USDA in such an exercise, if done in good faith, are far more likely to achieve a meaningful result than embarking upon yet another round of administrative reorganizations and the like which invariably accomplish nothing meaningful.

 

Point Three:    It is undeniable that the administration of USDA farm loans and benefit programs has suffered from pervasive discrimination against Latino/Hispanic farmers, as well as other minority farmers and ranchers, for decades.  At a time when many of its core historic missions are in severe jeopardy due to globalization of agriculture, the USDA can ill afford to continue to be distracted by persistent accusations that its stewardship of tax payer funded farm loan and benefit programs suffers from systemic discrimination.

  

SPECIFIC DEMANDS
 

FIRST:    THE STATUS QUO MUST BE QUICKLY CHANGED THROUGH FUNDAMENTAL REFORM OF CURRENT USDA POLICIES AND PROCEDURES GOVERNING THE ADMINISTRATION OF USDA FARM LOAN AND BENEFIT PROGRAMS.

 

        More specifically, among the changes which must be made are the following:

1. FSA offices serving Hispanic clients must publish all information regarding farm loan and benefit programs, including all application and related forms, in Spanish, and must employ personnel fluent in Spanish to assist Hispanic clients in navigating the application process.
    

2. FSA must be required to maintain a log-in system and to stamp, among other things, the date the application is given to or picked up by a farmer, the date it is returned and the date it is deemed complete, USDA must also be required to capture and maintain this date information in a computerized database.
    

3. Once the application is initially returned, FSA personnel must promptly review it for completeness and advise the applicant whether the application is complete.  If the application is determined to be incomplete, the USDA must then promptly provide in writing a list of the information needed to complete the application.  All such communications must be provided in Spanish when circumstances dictate.
    

4. FSA must establish a system which ensures both that applications will be reviewed and considered in the order in which they are received and that all applications will be approved in the order in which they are received and deemed complete by FSA.  Similarly, funds to farmers for loan and benefit programs are to be allocated on a first-come, first-served basis.
    

5. USDA must provide a receipt for service to all farmers documenting each contact with USDA agencies serving farmers.  Each such receipt must be time and date stamped, and a copy must be provided to the farmer.  USDA will be required to capture such time and date information and maintain the same in an electronic database.
    

6. A substantial fund of money, the precise amount to be determined, will be placed in an escrow account under control of a court-appointed monitor.  These funds would come from the judgment fund because this would be structured as the settlement of litigation.  The purpose of the fund is to provide the financial support necessary to create and maintain a network of community based outreach programs.  The funding for the outreach programs would not be subject to vicissitudes of the current 2501 program and the annual appropriations process USDA must endure, and it would be free of USDA control.  The outreach fund would be maintained for 7 years and would be of sufficient size to provide funding, on an annual basis, to these outreach groups.
    

7. Establish a new SDA loan program to address the unique barriers and limitations of SDA farmers.  The program will have among its attributes new criteria for loans to be developed in consultation with plaintiffs, loans based on need and ability to repay that allow applicants with limited resources to qualify and long term participation.  Once established in the SDA program, the farmer need not compete for funding every year, but will have funds available to implement his/her farm management/marketing cooperative and credit program.  In effect a multi-year credit line would be established.
    

8. The Secretary shall promote representation by plaintiffs and all other socially disadvantaged farmers on all research and promotion boards and councils that receive any financing or support from USDA by nominating socially disadvantaged farmers to all such boards and councils with a goal of achieving proportionate representation.
    

9. The Secretary shall also promote the representation of plaintiffs and other socially disadvantaged farmers on the Agricultural Technical Advisory Committee and Agriculture Policy Advisory Committees and participation in such programs as Value Added Agricultural Product Market Development Grants, Agriculture Innovation Center Demonstrations, Pilot Programs For Rural Development Strategic Plans and Implementation, Rural Firefighters and Emergency Personnel Grants, and Scholarship Programs.

 

SECOND:  IT IS ESSENTIAL TO ESTABLISH AN EFFECTIVE METHOD OF ACHIEVING TRANSPARENCY AS REGARDS THE ADMINISTRATION OF THE FARM LOAN AND BENEFIT PROGRAMS IN ORDER TO ENSURE THAT THE REFORMS ARE WORKING.

 

        This is central to the entire reform effort.  Among its principal building blocks are the following:

 

1. The court-appointed monitor will retain a team of technology experts to perform an audit of the hardware and software currently in use as regards to the FSA farm loan and benefit programs which, by many accounts, is badly in need of modernization.  The results of the audit will be shared with the court, the USDA, GAO and the appropriate committees of Congress, together with cost estimates for accomplishing this modernization.

 

2. USDA must immediately implement the provisions of Section 10708 of the Farm Bill of 2002, requiring transparency accountability.  Specifically, all USDA agencies and programs serving farmers must make information available at the county and state level on USDA agency websites, to be revised on an annual basis.  Such data must aggregate the participation levels of farmers by race, gender and ethnicity in each program that serves farmers in a manner that allows county by county, state by state and national comparisons with the overall number of farmers in each county, state and at the national level, according to an accurate Agricultural census, aggregated by race, ethnicity and gender.

 

3. FSA must specifically provide the information required in Section 10708 with respect to county committee elections.  FSA must also report county by county, state by state and national figures on the number of eligible voters who voted in each county committee election, and the number of ballots disqualified in each election.

 

4. County Committee Election Reform.  Purge voter lists of ineligible persons and persons who have failed to participate in farm program activity for five years or who have not participated in one of the last two elections or participated in any FSA activity over the last three years.  Develop a voting registration system within one year of the date of consent decree.  Replace current petition system.  Preclude one person from casting more than one vote and provide strict enforcement of existing regulations with respect to term limits and conflict of interest.

 

5. In addition to the information currently being captured and retained by FSA in its centralized electronic databases, each FSA office serving farmers must also capture the following information with respect to credit and farm program applications:

 

• The date the application was first requested by applicant;

 

• The date the application was received by applicant;

 

• The date the application was returned to FSA;

 

• The date it was deemed complete;

 

• If the application is deemed incomplete, the date;

 

• If for a loan, the loan amount requested, and if approved the loan amount and interest rate actually approved and the reason for any discrepancy;

 

• If for a farm or disaster program, the program benefit and amount requested, and if approved, the actual benefit provided and the reason for any discrepancy;

 

• If the loan or farm program application is rejected, the FSA office must capture and retain in the databases the reason for the loan or program benefit denial;

 

• In reviewing and determining the need to retain data, the foregoing list is not meant to be exhaustive but illustrative and the goal of information gathering should be to insure that USDA’s lending practices are sufficiently transparent to the monitors, Congress and any committee thereof exercising oversight as well as USDA management itself can readily review and audit USDA’s lending practices for evidence of possible discrimination; and

 

• To the extent that USDA undertakes any future modifications of its data processing functions, or capability and its recordkeeping policies, USDA commits that no such change shall be for the purpose or have the effect of rendering USDA’s lending practices less transparent or less readily subject to an audit of its lending operations.

 

6. Using the enhanced and more easily accessible databases, annual reports reflecting the experience of Latino/Hispanic and other socially disadvantaged farmers in utilizing the farm loan and benefit programs will be submitted to the court-appointed monitor, USDA, GAO and the relevant Congressional committees.

 

7. The court-appointed monitor will annually provide an evaluation of USDA’s progress in eradicating discrimination in its administration of farm loan and benefit programs and, should additional remedial relief be needed, the monitor will so recommend.  The court will then conduct a hearing on the recommendation to determine whether modification of the settlement is necessary and appropriate.

 

THIRD:  PAST WRONGS SUFFERED BY LATINO/HISPANIC FARMERS BECAUSE OF DISCRIMINATION CAUSED BY USDA POLICIES AND CONDUCT MUST BE RECTIFIED TO THE MAXIMUM EXTENT POSSIBLE 

1. The first in the process is for each Latino/Hispanic farmer or rancher to demonstrate his eligibility for this compensation.  To do so each applicant must sign a form that requires the farmer to state, under penalty of prosecution for perjury and filing a false claim, that (1) he or she applied or attempted to apply for a loan during the period January 1, 1981 to December 31, 1996 or from October 13, 1998 to the present; (2) to the best of his or her knowledge and belief, he or she met all of the eligibility requirements to receive either farm credit or to participate in a non-credit farm benefit program (the requirements would be spelled out in the form); (3) the applicant was denied the loan or subsidy or the loan was delayed or the loan was approved for less than the requested amount; and (4) a similarly situated white farmer received more favorable treatment from USDA.  For farmers who are unable to identify a specific white farmer who received more favorable treatment, USDA agrees to cooperate fully and promptly with plaintiffs in identifying all such comparable white farmers.  With respect to those farmers claiming compensation for the period January 1, 1981 to December 31, 1996, there would be additional affirmation that they complained to the USDA or some federal, state or local official about their denial of equal treatment in their attempt to obtain USDA credit.

 

2. Those who qualify would be eligible to receive:

 

a)     Forgiveness of all outstanding USDA indebtedness.

 

b)    Priority consideration for loans for a period of seven years from entry of Consent Decree.

 

                                                    i.     In considering eligibility for priority loans, USDA will not deny loans on the basis of so-called bad credit that results from USDA’s initial refusal to provide credit to applicant.

 

                                                  ii.     When a farmer would be entitled to debt forgiveness under the decree but for the fact of a prior discharge of such debt, the prior discharge shall not be used to prevent the farmer from receiving a priority loan.

 

c)     Priority consideration for loans to purchase property inventory for a period of seven years from entry of Consent Decree.

 

                                                    i.     In considering eligibility for such loans USDA will not deny loans on the basis of so-called bad credit that results from USDA’s initial refusal to provide credit to applicant;

                                                  ii.     When a farmer would be entitled to debt forgiveness under the decree but for the fact of a prior discharge of such debt, the prior discharge shall not be used to prevent the farmer receiving a priority loan to purchase inventory property; and

 

                                                iii.     To the extent that a farmer’s former property is in inventory, the farmer will have priority to reclaim his or her farmland.

 

d)    Priority consideration for all other USDA Program benefits.

 

3. An efficient and effective system for administering liquidated damages to Latino/Hispanic farmers and ranchers must be established.  The liquidated damages would vary based upon the nature of the injury, e.g., X amount for applicants who wanted to farm and were denied that opportunity through loan denial or the refusal to provide an application, Y amount for applicants who were farming when they applied for loans and whose loans were either arbitrarily reduced or delayed resulting in income loss, and Z amount for applicants who were farming when they applied for loans that were denied or debt servicing that was denied causing the farmer to lose his or her farmland.

 

4. The tax consequences for accepting any of the above benefits will be absorbed out of a fund established by USDA, and administered by the court appointed monitor, under supervision of the court.  The source of such funds will be the Judgment Fund.