USDA: Native Americans need better loan access
HURON, S.D. -- The U.S. Department of Agriculture has expanded the availability of farm loans for American Indian tribes and members to buy tribal farmland that has multiple owners.
HURON, S.D. - The U.S. Department of Agriculture has expanded the availability of farm loans for American Indian tribes and members to buy tribal farmland that has multiple owners.
The change will remove “a longstanding barrier to financing”, increasing farm-loan availability to Native Americans who want to start or expand a farming or ranching operation on Indian lands, according to the South Dakota office of the Farm Service Agency, based in Huron.
The FSA is an arm of USDA.
The change, the result of more than a dozen tribal meetings across the country, reflects new authority granted by the 2014 farm bill, which allows USDA to provide revolving loan funds to qualified intermediary lenders that can relend the funds to qualified tribes and individuals, FSA says.
According to FSA:
Under the 1887 Dawes Act, Indian reservation land was divided and allotted to individual tribal members such that with the passing of each generation, title ownership was divided and parceled among heirs, while the land was not. As a result, land once owned by a single person could today be owned by hundreds or thousands of individuals, resulting in what is known as “highly fractionated Indian land.” In many instances, landowners are unknown or cannot be located, which complicates the coordination of ownership or prevents the use of the property altogether. There are more than 245,000 owners of three million fractionated land interests, spanning approximately 150 Indian reservations.
USDA now allows tribes and tribal members to submit a farm loan application to an intermediary lender. To participate, intermediary lenders first must be approved by USDA. The lenders may be private and tribal nonprofit corporations, public agencies, Indian tribes, or lenders subject to federal or state regulation (such as a credit union or other financial institution). FSA will lend to the intermediary, which will relend to the applicant. The intermediary lender also will administer the loan for the applicant.
For more information, visit www.fsa.usda.gov/farmloans or contact the local FSA county office.