USDA, Black Farmers Reach Settlement

The U.S. Department of Agriculture and the Justice Department announced on Thursday that USDA will pay $1.25 billion to settle claims from black farmers who say the agency used racial discrimination to delay or deny them loans and other government assistance.

The settlement, dubbed Pigford II, is contingent upon Congressional approval and funding of $1.15 billion by March 31 that would then be added to the $100 million that Congress appropriated in the 2008 Farm Bill. If that deadline is not met, the plaintiffs will have the option to walk away from the deal.

“Our goal is getting it done,” said National Black Farmers Association President John Boyd, Jr. “We’re not interested in going to court and a long, drawn out court fight for a group of black farmers who don’t have the resources to defend themselves.”

In the original lawsuit, settled in 1999 and named after North Carolina farmer Timothy Pigford, the USDA paid approximately $1 billion to 15,000 claimants. But close to 80,000 more were excluded from participating in the settlement process because they were unaware of the filing deadline and in some cases the actual lawsuit. Pigford II will enable those farmers to submit their claims through a non-judicial process in one of two ways.

Track A is a simplified claims process that Treasury Secretary Tom Vilsack said will allow farmers to seek quick relief of up to $50,000. The second track will involve a more rigorous process, but also would yield a much higher payout of up to $250,000. Final awards, however, will be based on the number of successful claims filed. In the meantime, a moratorium will be placed on the foreclosure of farms with pending claims until the farmers have completed the claims the process.

“I look forward to a swift resolution to this issue, so that the families affected can move on with their lives,” said President Barack Obama in a written statement.

In his 2010 budget request, Obama requested $1.15 billion to settle the outstanding claims. Vilsack explained in a conference call Thursday that lawmakers did not appropriate the funds because they were concerned that there was no process or signed settlement agreement in place. He believes that there now will be plenty of bipartisan support resolve the case.

“Congress has already spoken fairly clearly about this in the 2008 Farm Bill and I think that [it] for the most part will be very appreciative of the fact that we actually have a structure, a settlement number and an agreement by counsel for the plaintiffs,” said Vilsack, adding that the settlement would close a “sordid chapter in USDA history.”