- By Rob Capriccioso
- Food | Agriculture
On May 27, the day that Chickasaw Nation citizen Janie Simms Hipp had a speedy confirmation hearing in front of the U.S. Senate Agriculture Committee as her nomination to become General Counsel of the U.S. Department of Agriculture proceeded, the agency’s new Farm Service Agency Administrator Zach Ducheneaux was looking forward to equitable days to come.
“The Senate Ag hearing went well,” he told Tribal Business News, going out of his way to voice that he not only supports her because he’s a member of the Biden administration but also because he personally believes in her. “It only took them an hour or so to wrap it up, so that’s a pretty good sign.”
Ducheneaux, a member of the Cheyenne River Sioux Tribe, was seeing the prospect play out of perhaps another Native American soon joining him in the higher ranks of a federal department that has had perennial problems doing right by American Indians. While the Obama administration settled high-profile discrimination lawsuits from Black, Hispanic and Native American farmers, lingering distrust remains over issues such as access to programs, equity, traditional foods and consultation.
Formerly director of the Intertribal Agriculture Council before being tapped to join the USDA this February, Ducheneaux takes these issues of trust to heart. As he promotes the American Rescue Plan (ARP) funding that allows USDA to pay up to 120 percent of outstanding balances for direct and guaranteed loans to socially disadvantaged farmers and ranchers, he also makes a conscientious effort to be sure Native Americans understand that a new day has come.
In an interview via phone from his office, Ducheneaux explained that he wants people who are eligible for the aid to make sure they share how USDA officials treat them throughout the assistance process this summer.
“We expect our staff to be excited for them and be easy to work with throughout this process and be willing to help,” he said. “We would be interested to know if they find circumstances to the contrary.”
His signal was clear. The rest of our interview follows:
Tell us a little bit about your background and how you are now serving Native Americans and others from within the USDA.
My previous employment was with the Intertribal Agriculture Council (IAC), and in that work, I served Indian Country specifically. The IAC represents all federally recognized tribes and Alaska Native villages. Through that work, we would work with as many of the 80,000 and counting American Indian producers as possible. I had done that for the last 10 years prior to getting this position. In the last two years, I was the executive director.
How well is that background going to serve you at USDA?
I think it will serve me very well. During my tenure there as a farm advocate, we worked very closely on getting improved access to USDA programs and services for Indian Country and their producers. There’s a natural evolution into serving on this side of the table, if you will.
We have seen some examples where tribal advocates going to work for the federal government hasn’t always been a good fit. How are you adjusting?
It has been challenging because there is so much that the Farm Service Agency does. Foundational to most of our work at the Intertribal Agriculture Council was access to credit and ag finance. There’s been a bit of a learning curve getting up to speed on all of the farm-related programs. Most of those programs are the result of a system that’s built around inequitable treatment of socially disadvantaged producers, so there wasn’t a lot of experience to be had in increasing program participation. The programs that have been developed really haven’t been developed to target Indian Country, or African American and Hispanic farmers, or the Asian American population that grows produce in this country.
Are Native American farmers, ranchers and producers a crucial backbone to the economy and to the culture of America?
Yes, generally speaking, and more specifically to their own local and regional economies, they absolutely are. Many of the territories where these producers are operating are rural in nature, and the foundational economy for those rural communities is going to be that agricultural production. So it behooves Indian producers and Indian Country to try to create as much economic impact from their ag production as they can.
You know Indian agricultural producers probably better than anyone, so you know how they struggled both during the pandemic and pre-pandemic. Can you talk about how they’re doing right now?
I may be experiencing some confirmation bias, but I’ve heard a lot of hope from Indian Country. With the solutions that are being made by the Biden-Harris administration, the staffing in critical positions — we’ve got Heather Dawn Thompson [a long-time Indian Country lawyer and advocate who is also a member of the Cheyenne River Sioux Tribe] over at the [USDA’s] Office of Tribal Relations; you’ve got myself, the administrator of the Farm Service Agency — one of the two agencies within the Department of Agriculture that has the highest capacity to reach out and touch the lives of producers.
As for the impacts of the pandemic, any of these global economic upheavals are going to more drastically impact the most economically vulnerable people in that economy. That’s where our Indian producers, for the most part, find themselves. So the impacts were severe. The majority of Indian agriculture revolves around livestock production in one way or another. And the livestock industry was really set back on its heels, and it still hasn’t fully recovered. Just last week, the big three meat packers posted record net profit margins again while our producers continue to get less than what their product is valued. Indian Country has been victim to the same ills all other producers have in trying to create a viable living from growing food and produce, but more so because of that economic vulnerability that we talked about earlier.
Talk about the American Rescue Plan’s debt relief funding designated for the USDA. How specifically is it going to aid Indian producers?
It’s going to position Indian producers and all socially disadvantaged producers who have an opportunity to participate in this to have a once-in-a-multi-generational opportunity. They will have their Farm Service Agency direct and guaranteed loans paid off on their behalf. They will have Farm Storage Facility loans paid off on their behalf. And they’ll have 20 percent more than that to take care of any other expenses that could result from these payments being made — taxes are one of those things. It will also allow them to take steps that our producers are all very adept at, to mitigate their tax consequences, buy some assets, change the nature of their production, increase their capacity. There’s a lot of opportunity there. Our producers in Indian Country and socially disadvantaged producers across the country are going to reap the benefits of this.
How difficult is it to qualify for the program?
There is nothing that a producer needs to do to qualify for the program. If they are a member of a socially disadvantaged group, pursuant to the definition in the 1990 farm bill, which includes Black or African-American producers, American Indian or Alaska Native producers, Asian American or Pacific Islanders, or if you are of Hispanic or Latino ethnicity and have documented that in your file, and you have an eligible loan, you will receive a payment.
Some producers, it’s important to note, may have realized a benefit from not documenting any of that in their file. That’s part of the systemic inequity where producers felt more comfortable disavowing their heritage and going ahead and applying as a non-socially disadvantaged producer because the deck has been stacked against them for so long. Other producers didn’t know that they could have made that designation at all, so they can secure a form on the Farmers.gov/AmericanRescuePlan website, fill that form out, submit it to their local or state FSA officials, and, if they have eligible loans, they will then receive a second letter that’s coming out in the next few weeks.
What is the most amount of relief that a producer could be eligible for?
There is no limit on the relief beyond the amount of debt they have that qualifies in one of the loans. In the Farm Service Agency direct loan portfolio, the most you can borrow is $600,000 for real estate acquisition and $400,000 for farm operating capital. So, if a producer had both of those types of loans, that’s the most that they could get paid back. As for the guaranteed loan portfolio, Congress changed the limits to $1.776 million, and that’s a loan through a lender who then seeks a Farm Service Agency guarantee of 90 to 95 percent on that loan.
Are you hearing from a lot of Indian Country producers who have learned about the program and want to take advantage of it?
Yes. Our goal in the agency is to get to a 100 percent payment rate — 100 percent participation. We’re reaching out through all of our networks, we’ve had stakeholder engagement listening sessions, and we’ve talked to representatives of all of the socially disadvantaged groups to ensure that we are doing broad outreach and really getting out there into the more rural areas of the country where these producers work.
When does the relief start happening?
The next step is that the producers are going to receive an offer notice, and on that notice is going to be a worksheet with our calculation of the payment that they have got coming to them. Producers can accept that, consult their records to see if they have a different amount that they think it should be, and they can even decline it if they want. Those letters will start going out over the next couple of weeks. Once we receive that offer notice back, signed by the producer, showing one of those choices, we hope it will be within three weeks that we can get the payment out to them via direct deposit.
So will all this happen this summer?
Yes, I would say June through July. We are telling producers that if they don’t receive a notice by July 1, then they should contact us.
Are the notices computer-based, or is it all via mail?
If we have an email address on file, we can send that notice to a producer via email, but we will send it via U.S. Mail. That’s our official way to do this type of correspondence.
There was a statement put out May 27 by the American Bankers Association that said they wanted to clarify that they do in fact support the USDA’s debt relief program that you’ve been discussing. Can you clarify why they did that?
Lenders, ever since the law was signed, have expressed concern at the potential impact of having these guaranteed loans paid off for the borrowers. Because the lenders have these loans out in what they call ‘performing assets,’ and they can count on a regular interest payment from that borrower for their future cash-flow purposes. Those lenders are going to find themselves without that performing asset, and with a lot of liquidity that they have to deploy back out the door in order to continue to receive that income over the next few years. They have expressed their concerns to the department, and The New York Times did an article on this, and the lenders didn’t come off too favorably in that. I think that’s why they have put out that clarifying position.
Are you glad they put out that position?
We recognize the lenders’ concerns, but the department and the Farm Service agents are going to put the needs of the borrowers first and make these payments to the borrowers. We’re including pre-payment penalties that the banks may have had on those loan arrangements, so that’s a step a lender takes in order to account for the prospect of the loan being paid in full ahead of time. So we’re taking that step to mitigate the concerns of the banks, and, unfortunately, we don’t have the capacity to do all of the ag financing that is needed in our communities by our producers. The lenders are a necessary part of this larger system of ag finance, and with our guaranteed loan program, it is their choice to mitigate their risk because agriculture is an inherently risky business in their estimation.
Is there a commitment at today’s USDA to traditional and Indigenous foods?
I think there is a commitment at the Farm Service Agency and at the department to help the producers have a better opportunity to make the choices in production. As we contemplate moving the initiatives of the Biden-Harris administration forward, climate-smart ag is one of those, and improved resiliency in our local and regional food systems is another. Equity is another. All of these are tied in, along with recovery from the pandemic, so it stands to reason that traditional and Indigenous foods, to the extent that they can be produced in an economically viable way for the producers that helps them improve their standing, they’re going to be a part of that.
Are trust lands eligible for all USDA programs?
There are some unique circumstances around trust land that do make it challenging for our producers to access some of our normal programs: land tenure issues, the fractionated nature of some of the trust land, where you have challenges perfecting control of that land. We’re working inside the agency to identify all of those programmatic barriers and do our best to knock them down so that we can get full participation from our producers using trust land.
Is that an issue you’re hearing about from individual Indians and tribes that’s important to them?
Yes, that’s very important because it’s the safety net that’s been built under all of our farming and ranching communities since the ‘Dirty ’30s,’ and if we can’t have the same access, we’re going to stay in a more economically vulnerable position than our non-Indian, non-socially disadvantaged counterparts.
Is a lot of consultation to tribes going to happen under your watch?
Yes, there will be more consultation and hopefully more timely consultation as the policies are being developed. And not so much having the consultation meeting to say, ‘Here’s how the decisions have been made on your behalf, how do you feel about them?’ That’s often the case in Indian Country, and one of the goals of the administration is to build more inclusion in that policy development all across the country so that the solutions we choose to implement are the most equitable that they can be.
I have to ask about the Keepseagle settlement of 2010 that was the USDA’s attempt to settle long-standing discrimination lawsuits from Native farmers. How do you feel about how it was implemented?
I think it’s important to note that all of those class-action lawsuits — Pigford, Keepseagle, the Hispanic and women’s administrative claims — they didn’t go far enough to make anybody who had an actual loss whole. In Keepseagle, for instance, there was a $50,000 track and a $250,000 track and some loan forgiveness, but if you had a discrimination claim one generation ago, the lost opportunity far outweighs either of those award amounts. But I think those settlements were a critical first step down the road that we’re traveling now.
Finally, would you classify USDA Secretary Tom Vilsack as a strong advocate for Native Americans?
Absolutely. We would have never had the Keepseagle settlement had it not been for Secretary Vilsack. He has put together a team that will continue to focus on not only Native issues, but the issues of all socially disadvantaged producers and all stakeholders in the food and agriculture and nutrition system.
This interview has been edited and condensed for clarity.