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FUNDING CUT FOR 2501 PROGRAM DESPITE RECORD NEED TO RESPOND TO COVID-19 PANDEMIC

December 11, 2020


Whitten Building (USDA) on a rainy day. Photo credit USDA.

Historic discrimination and inadequate assistance from the U.S. Department of Agriculture (USDA) programs have contributed to the exceptional challenges that farmers of color and military veteran farmers face in the industry. For three decades, the Outreach and Assistance for Socially Disadvantaged and Veteran Farmers and Ranchers Program (also known as the “Section 2501” program) has been the only farm bill program reserved to address the specific needs of these underserved populations in agriculture. USDA recently announced the latest round of funding for 2501 projects, dedicated to providing outreach and critical support to BIPOC farmers. Unfortunately, total program funds are smaller this year, placing undue stress on already stretched-thin community organizations working to respond to farmers during this unprecedented period of prolonged economic hardship.

Program Background

For the past three decades, the goal of the Section 2501 program has been to increase historically underserved farmers’ awareness of and access to USDA resources. It was created in 1990 to address the historic inequities that farmers of color, or socially disadvantaged (SDA) farmers, faced in accessing USDA programs, including Farm Service Agency (FSA) loans. Congress added military veterans to the program in 2014 as an additional underserved audience. 2501 grants provide funding to community-based organizations and minority-serving academic institutions to conduct critical outreach and technical assistance to communities of color and veterans. 

The 2018 Farm Bill combined the 2501 program with the Beginning Farmer and Rancher Development Program (BFRDP) into a new umbrella program: the Farming Opportunities Training and Outreach (FOTO) program. Through FOTO, Congress provided both BFRDP and Section 2501 with permanent baseline funding, while maintaining each program’s core functions. 

For more information on the Section 2501 program, check out NSAC’s Grassroots Guide.

Funding Cut for 2501 Projects this Year

The latest round of Section 2501 funded projects was announced earlier this fall. The USDA announcement touts $17.6 million in grants for socially disadvantaged and veteran farmers and ranchers, though the number subtly includes funding for a separate initiative focused on faith-based initiatives in persistent poverty communities. We will focus on the Section 2501 grantees for this analysis, with commentary at the end on the Trump Administration’s Centers for Community Prosperity (CCP) Initiative.

Congress mandates that FOTO funds be divided equally between Section 2501 and BFRDP, with each program receiving $15 million in mandatory funding for fiscal year (FY) 2020. Congress provided the 2501 program with an additional $2.5 million in discretionary funding in FY 2020, bringing total grant funding to $17.5 million. However, only $12.8 million of this funding is actually being invested in 2501 grants this year, with the remainder supporting a separate initiative created administratively, a socially disadvantaged farmer policy research center, and administrative costs for the program.

NSAC is disappointed that this year’s 2501 grants are precipitously lower than the $15.7 million awarded in FY 2019 and far short of the $17.5 million Congress provided for the program this year. Paradoxically, the cut in funding is accompanied by a rise in the number of projects funded; 36 compared to 33 last year. This means that, on average, each project received less funding this year than last; smaller projects mean fewer grassroots opportunities to reach and provide critical assistance to BIPOC and veteran farmers.

The consequences of this decision for farmers of color and veteran farmers are only magnified by the circumstances which have defined 2020. It is vital that these underserved communities – disproportionately impacted by the pandemic – have the knowledge, tools, and connections needed to access USDA resources and funds, including emergency COVID-19 relief programs to mitigate the effects of the pandemic across the food system. 

The cut in 2501 grant funding is unacceptable and goes against the intent of Congress, which explicitly provided additional funding for 2501 projects for FY 2020. While we hope that the funding USDA redirected to the new CCP Initiative will ultimately benefit farmers of color, this decision by the Trump Administration nonetheless means that fewer organizations will receive less funding for the critical and time-consuming technical assistance work needed this year more than ever. 

Spotlight on This Year’s 2501 Grantees

NSAC congratulates all of this year’s Section 2501 grant recipients. We are particularly excited to acknowledge a number of the hard-working and dedicated community-based organizations that provide direct support to BIPOC and veteran farmers every day. Highlights of select Section 2501 projects that did receive funding this year appear below, to provide a sense of those services which are more valuable now than ever. 

Southeast Michigan Producers Association (SEMPA), Michigan will use their $266,667 grant to lay foundations for a sustainable production, marketing, and distribution system throughout Southeast Michigan, combatting the “food deserts” of the metropolitan Detroit area. The project will assist socially disadvantaged and veteran farmers to access USDA programs and services, in addition to improving financial planning and marketing skills while connecting them to farmers and markets in the region. We are grateful to SEMPA, an NSAC member, for leading this work. 

Nuestras Raíces, Inc., Massachusetts received $400,000 to assist socially disadvantaged, veteran, and young farmers to launch and operate farm projects by growing culturally relevant crops. This will be accomplished through training in Nuestra Raíces’ farm incubator, bilingual technical assistance, and offering direct market management and sales experience through Nuestra Raíces’ Mobile Markets. 

Alabama State Association of Cooperatives, Alabama will use their $266,667 grant to provide outreach and technical assistance to Black and aspiring farmers across the state to retain, expand, and utilize their landholdings as well as assist farmers to organize cooperatives. In addition, the project aims to guarantee that Black farmers in the western Alabama Black Belt have equitable access to all USDA programs and resources. 

Taos County Economic Development Corporation, New Mexico received $400,000 to sustain the agricultural heritage of the Hispanic and Indigenous farmers and ranchers in the Taos Valley while modernizing the local food system. The project will connect Indigenous, Latinx, and veteran farmers to local, state, and federal resources while providing hands-on training in business planning and humane livestock management, slaughter, and meat processing. Local farmers will be sponsored, too, to attend annual agricultural conferences and share knowledge with the community. 

A full listing and descriptions of 2020 Section 2501 (and CCP) projects can be found here

Award Allocation and Distribution Trends

The Section 2501 program awarded $12.8 million in federal grants to fund 36 new projects in FY 2020. We have already commented on the implications that these total numbers pose. Now, it is time to ask where these funds are going – from the lenses of geographic distribution, organization type, and the demographics of populations served. Much has changed since FY 2019. 

RegionAwardsAmount (millions)
North Central4$1.4 
Northeast3$1.1
South18$6.4
West11$3.8
Total36$12.7

Congress requires that 2501 grants be regionally balanced across the county. While grants were distributed relatively equitability across regions in 2019 (with a slight preference for southern and western grants), this year the schism between southern and western grants compared to the rest of the country has widened significantly. In total, half of this year’s projects are based in the South, and another third are based in the West. This leaves less than 20 percent to serve BIPOC farmers in the rest of the country. While it’s obvious that some regions of the country have higher percentages of farmers of color, this growing disparity leaves BIPOC farmers in the Northeast and in the agricultural heart of this country with fewer and fewer resources to access critical USDA programs, which will only continue to widen discrepancies. 

Congress also mandates that funding priority be given to nonprofits (NGOs) and community-based organizations (CBOs). This year, 69 percent of projects were awarded to NGOs and CBOs, with the balance supporting university and extension led projects. This trend is on par with last year’s award allocations. NSAC and our allies have long advocated that priority be given to NGO and CBO-led projects, specifically those who have a demonstrated track record of working with historically underserved communities.

The average grant for NGO and CBOs in FY 2020 ($340,000) was significantly smaller than previous years ($490,000) – largely due to the smaller pot of grant funding available as previously mentioned. This trend also holds true for university-led projects which also received smaller grants ($388,000) this year compared to last year ($466,000).  

Demographically, all FY 2020 Section 2501 projects – across all regions and organization types – are designed to support farmers and ranchers of color. This is self-reported, derived from the recipients’ publicly available project descriptions. The most common target population specified is Latinx farmers, with black and indigenous farmers not far behind. Immigrant or asylee populations are the explicit focus of two projects, in addition to two projects which aim to work with farmworkers or former farmworkers. It is worth noting that many projects (almost 20) merely name that the project will support “socially disadvantaged” farmers and ranchers, without specifying which specific target population(s) will be served. A deeper look at the recipients which do not specify reveal that most are black-led or black-serving community based organizations or 1890 land-grant universities (i.e. historically black colleges and universities). 

Military veterans will be served by 25 projects in FY 2020, or 69 percent of total projects. Each recipient which named veterans a target population also reported an intent to focus on SDA farmers and ranchers; in other words, no Section 2501 project this year will be supporting veterans at the expense of farmers of color. This has been a concern since the 2014 Farm Bill expanded the program to military veterans, especially against the backdrop of the program’s funding cuts (more background above). We are pleased with the “both-and” approach applied this year.

Critical Funding Redirected

While Congress provided $17.5 million in funding for the 2501 program for FY20, NSAC and our partners were concerned to learn earlier this year that USDA had redirected $2 million of this funding to fund a separate, administratively created initiative, rather than support the longstanding 2501 program as Congress intended. Another $2 million was redirected from the Natural Resources Conservation Service (NRCS) conservation technical assistance funding.

Announced only a few days before the 2501 program, USDA launched a new Centers for Community Prosperity initiative that seeks to address economic development in persistent poverty communities – with a focus on faith-based initiatives. While this new program does include socially disadvantaged farmers as a target audience, the program is broader in focus (including beginning, limited resource and other historically underserved producers) and much more prescriptive in project design than the 2501 program.

The program requires organizations to set up Local Prosperity Councils (with strict requirements for the partners that must be appointed to this council), rather than allow organizations to design projects and structures that reflect the needs of their communities. While the program may have some merit on its own, it clearly extends beyond both the scope and purpose of the 2501 program and should not be funded with funding intended for 2501 grants.

In total, USDA diverted $4.2 million into this new initiative, funding 13 projects in 11 states (though the geographic scope extends further). The majority of projects don’t specify which community they are serving, just that they will support “socially disadvantaged” producers. This is concerning, especially given the lack of clarity and confusion on whether or not each funded organization will be held to the same standard as 2501 and be required to demonstrate a prior track record of working with socially disadvantaged producers in order to receive grant funding. 

What’s more concerning is that many of the CCP projects have no prior history with 2501 grant funding, and little information is publicly available about their previous experience working with farmers of color – or even farmers in general. Several projects raise red flags and pose serious questions on whether or not funding will be used to ultimately benefit BIPOC farmers and whether or not the institutions have expertise and trust within these communities. 

Additionally, it is unclear whether or not all funded projects will target “persistent poverty counties” as USDA required in its CCP Funding Announcement. While this is not a Congressionally mandated requirement for the 2501 program, USDA established this requirement administratively for the CCP program. It does then raise red flags on why some projects were funded that do not meet these requirements while others were arbitrarily held to this standard.

In review of these grants, NSAC and our partners who work on the ground with BIPOC farmers have many concerns and unanswered questions about the merit and legal grounds for the use of 2501 funds to support this new USDA initiative.  Over the past several months, NSAC has been working with our allies and Congressional champions to pressure USDA to redirect this funding back into the 2501 program, and will continue to work with the incoming Biden-Harris Administration to ensure this misuse of funding does not happen again, and that the impacts of this misappropriation are ultimately rectified. 


Categories: Beginning and Minority Farmers, Carousel, Coronavirus, Grants and Programs


One response to “FUNDING CUT FOR 2501 PROGRAM DESPITE RECORD NEED TO RESPOND TO COVID-19 PANDEMIC”

  1. USDA 2501 Grant Program should have more and not less funding to meet the needs of underserved farmers and ranchers in America. Congress should make sure the USDA redirect this funding back into the 2501 program. Black farmers and ranchers have historically been overlooked and not had equal access to information to take advantage of USDA programs. These efforts has been in existence since slavery in underserved rural communities. We hope the Biden-Harris administration will correct and consider more funding for the 2501 Grant Program.

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