USDA cancels $300M grant program, affecting projects for underserved Minnesota farmers
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The U.S. Department of Agriculture is cancelling most funds for a nearly $300 million grant program designed to help underserved farmers access land, markets and capital.
The Increasing Land, Capital, and Market Access Program awarded about $300 million to 50 projects across the country in five-year contracts starting in 2023.
There were three projects active in Minnesota aimed at helping Latino, Indigenous and BIPOC farmers. All have lost funding, effective March 26.
When reached for comment, a USDA spokesperson said the department “remains committed to restoring fiscal discipline and ensuring that programs serve the farmers and ranchers we are mandated to support.”
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The spokesperson said that the Increasing Land, Capital, and Market Access Program “permitted the abuse of federal funds, including expenditures on the purchasing of a barbecue smoker, construction of a gazebo, massages, and, for one awardee, a $20,000 budget for ink pens alone.”
The spokesperson did not share details on which awardees were accused of misusing funds. Awardees have 30 days to submit an appeal to the National Appeals Division.
According to cancellation letters shared with MPR News, the USDA stated awards under the program had engaged in diversity, equity and inclusion practices that it deemed discriminatory. It also said most of the awards did little to improve land access.
However, some Minnesota awardees said a temporary funding freeze last year and communication breakdowns with the USDA made it difficult to use the funding.
Problems with the grant
Aaron Blyth, the agricultural program director at the Latino Economic Development Center, which had been awarded USDA funding, said that last year there were times when the organization went for months without being reimbursed.
“At one point, we had over $100,000 that was owed to us over a three to five-month period,” Blyth said. “It was hard to see how we could keep going into debt, keep floating that.”
Throughout the year, when the team asked the USDA questions for clarification on how to properly use the grant, Blyth said communication about the guidelines was often vague.
Due to the uncertainty, the team was hesitant to use additional grant funds for fear of reimbursement delays. It also had to downsize its staff throughout the year.
His team had been awarded $2.5 million to be spread over five years, $1 million of which went toward loans offered to farmers, while the rest covered overhead and staffing.
“One of the pushbacks that we've gotten is that too much money was going to the organizations and not enough of it was going directly to farmers,” Blyth said. “And I think that's a fair question to ask. And if they had given us an opportunity to review our application and move more money into the lending or into the grant-making sphere directly to farmers, we would have happily done that.”
Jan Joannides, executive director of Renewing the Countryside, a Minnesota-based organization that was a subgrantee of the award, said her team didn’t have much time to actually make much use of their grant.
Her team wanted to buy farmland and put agricultural easements on it to lower costs for incoming farmers. But they never had access to the easement funds.
“The Farm Service Agency had to establish new policies, and so it took a long time for them to establish the policies,” Joannides said. ”And then once they [did], they still did not enable the grantees to access the funds that were for things like the easements, down payment assistance, loans, those sort of things.”
Her team lost access to other funding sources during a USDA funding freeze in February. Then, just like Blyth, Joannides was cautious about using her funding after hearing from fellow awardees that reimbursements were being delayed.
“We were hoping to at least help at least 20 new farmers be able to access land affordably over the next three years,” she said. “And now it's just all disappeared overnight.”
Both Blyth and Joannides said they’re seeking alternate donors to fill the gap left by the USDA’s funding cuts.
