Federal Loan Program To Help Farmers Reclaim Generational Land Enriched By $67M

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About $67 million has been set aside for an heirs’ property relending program, which will extend low-interest loans to farmers trying to resolve issues denying them a clear title to their land.

Credit: Pixabay

The federal government is at last rolling out a loan program meant to help farmers reclaim portions of property lost when the land changed hands over generations, leaving the ownership rights unclear.

The program, called the Heirs’ Property Relending Program, was included in the 2018 Farm Bill but not implemented until this year. About $67 million has been set aside for the program, which will extend low-interest loans to farmers trying to resolve issues denying them a clear title to their land.

Consolidating ownership of farmland split up over generations in the absence of a will or succession plan will open doors to government programs and services and bank loans, among other things. It will also help keep the property in the family, warding off outside interests that may try to seize the land.

The complicated patchwork of ownership has caused untold landowners to lose their property over time. Black and minority owners have been particularly vulnerable, although so have poor white Appalachian farmers.

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“Title to property is not just proof of ownership, but it’s really the gateway to opportunity,” U.S. Agricultural Secretary Tom Vilsack said in a virtual press conference Thursday.

Credit: Georgia Recorder

“This is a reflection and it is a consequence of poverty,” U.S. Agriculture Secretary Tom Vilsack said Thursday. “It crosses geographic boundaries and crosses racial boundaries.”

Identifying how many heirs’ properties exist is a challenge, but U.S. Sen. Raphael Warnock cited research that estimated about one-third of rural Black-owned land in the South could fall under the category.

“Think about the implications of that for generational wealth when you look at the racial wealth gap,” Warnock said. “This is no accident. Keeping black farmers and Georgia from accessing legal services and obtaining proper documentation is a result of years – decades – of institutionalized discrimination across the agricultural sector.

“And so it is well past time for the federal government to tackle this problem head on,” he said, calling the program a “critical step” toward doing that.

Warnock and Georgia Congressman Sanford Bishop, an Albany Democrat, participated in a virtual press conference Thursday with Vilsack to announce the program is now funded and soon ready to start accepting applications. Vilsack estimated that thousands of rural landowners may benefit from the program.

Lenders, such as cooperatives and credit unions, can start applying for loans up to $5 million at 1% interest once the sign-up process starts in late August. Landowners can then apply to those lenders for loans and assistance.

“Because the heirs need to agree on land use decisions, it can be difficult to manage that farmland,” Bishop said. “This makes heirs vulnerable to forced petition sales or unscrupulous predatory investors who have, in fact, historically usurped farmland, stealing generational wealth from families.”

Many of the landowners lack the financial means to consult the legal services they need to establish a clear title, making the partial-ownership quandary a difficult obstacle for them to overcome, Bishop said.

Thursday’s announcement comes as $4 billion in debt relief for Black and minority farmers has been put on hold after white farmers filed a lawsuit calling the program unconstitutional. The money is intended to relieve the debt farmers accrued from decades of systematic discrimination in USDA lending.

Vilsack said the rollout of the heirs’ property relending program is not a response to that setback. He also said no work had been made to implement the loan program under the previous administration.

“This is really designed to address a problem that’s been around, literally, for more than 100 years,” he said, calling it “a very complicated problem that needed a resolution.”

“I think it’s going to provide a lot of hope and opportunity to folks,” he said. “Title to property is not just proof of ownership, but it’s really the gateway to opportunity.”

This story comes to GPB through a reporting partnership with Georgia Recorder.