Historically Underserved Producers: Is There Funding  for Women, Minority and Veteran Farmers?

May 25, 2022

Historically underserved producers get special benefits when applying for programs with the United States Department of Agriculture (USDA). For example, they’re eligible for higher payment rates or even receiving 50 percent of funds up front for cost share programs. This is pretty exciting! So who qualifies as a "historically underserved producer?"

Historically underserved producers fall into four main categories:

  • Limited resource farmers or ranchers
  • Beginning farmers or ranchers
  • Socially disadvantaged farmers or ranchers
  • Veteran farmers or ranchers

Still not clear? Let’s dive into each of the categories.

Am I considered a historically underserved producer?

 Let’s take a closer look at who qualifies for each special identity group. 

Limited Resource Farmer or Rancher

There is a very specific definition and set of criteria to meet for this category. We highly recommend using this tool from the USDA to verify if you qualify as a limited resource producer.

As a quick summary, a producer is considered “limited resource” if:

  • Your total gross farm sales this year (before expenses) are less than the recorded value of the previous two years, and
  • Your total household income is less than or equal to the national poverty level for a four person family OR less than 50% of your county’s average household income for the last two yearsThat’s how a person qualifies as a limited resource producer. But what if you want to apply for funding as a business?

That’s how a person qualifies as a limited resource producer. But what if you want to apply for funding as a business?

If your farm or ranch applies for funding as a business, your business will only qualify for “limited resource” funds and benefits if every member of your business meets the criteria to be considered limited resource farmers or ranchers. 

Beginning Farmer or Rancher

Individual farmers or ranchers who:

  • have operated a farm or ranch for less than 10 consecutive years, and 
  • will contribute management or labor to the farm or ranch that is essential to its function, in line with what the county or state requires

If your farm or ranch applies for funding as a business, your business will only qualify for “beginning farmer” funds and benefits if all members of your business meet the criteria to be considered beginning farmers or ranchers. 

Socially Disadvantaged Farmer or Rancher

The USDA defines a “socially disadvantaged” farmer or rancher as an individual producer who is “part of a group that experiences racial and ethnic discrimination due to being part of the group, regardless of personal matters.” This includes:

  • American Indian or Alaskan Native
  • Asian
  • Black or African American 
  • Native Hawaiian or other Pacific Islander, and/or
  • Hispanic

If your farm or ranch applies for funding as a business, your business will only qualify for “socially disadvantaged” funds and benefits if at least half of the members of your business meet these criteria. 

Veteran Farmer or Rancher 

You could be considered a veteran farmer or rancher if you’re an individual producer who: 

  • Served in the United States Army, Navy, Marine Corps, Air Force, or Coast Guard, including the reserve and was released with honor, and either:
  • Became a veteran within the last 10 years, or
  • Qualifies as a beginning farmer.

If your farm or ranch applies for funding as a business, your business will only qualify for “veteran” funds and benefits if all of the members of your business meet these criteria. 

What About Women Farmers?

We get a lot of questions about special funding for farmers and ranchers who are women. The USDA does not currently consider women under the historically underserved category. 

Currently there are no programs specified for women farmers but there have been pushes to include women in agriculture finance programs.

Here’s an example: The National Women in Agriculture Association calling for the “sustainable support of minority children and women farmers who are NOT currently being reached by the USDA's valuable extension programs and the American Rescue Plan funding.”

If you’re interested in scholarships for women in agriculture or would like to support women farmers, check out these tips from our FarmRaise Morning Briefing.

What does "historically underserved" mean for my farm funding?

The USDA Natural Resources Conservation Service (NRCS) pays farmers to implement conservation practices. Two of their most popular funding opportunities are the Environmental Quality Incentives Program (EQIP) and Conservation Stewardship Program (CSP) programs. 

 If you are a historically underserved farmer, you could receive higher payment rates (up to 90% of the costs of a practice covered, versus the standard 50 to 75%). You are also eligible to receive half of the funds in advance, which is notable given that these programs are usually reimbursement only. 

USDA also prioritizes historically underserved farmers by setting aside specific pools of funding. You could get priority consideration, for example, if you were to apply for an FSA microloan or the NRCS conservation program.

Do you have questions about whether your farm qualifies for some of these benefits? Reach out to us for a free consultation or sign up for FarmRaise today.

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