# The BALE Act of 2021: Making Farm Loans More Accessible for New and Minority Farmers

This bill makes it easier for beginning farmers and ranchers—especially those from minority backgrounds—to get government-backed loans for conservation projects. The federal government already guarantees certain farm loans, meaning if a farmer can't repay, the government covers the loss. This bill changes how much of those loans the government will guarantee, making it more attractive for banks to lend money to farmers who are just starting out.

Here's what actually changes: Currently, when a farmer borrows money for conservation work (like improving soil, managing water, or protecting land), the government might guarantee up to 90 percent of smaller loans but less for bigger ones. Under this bill, beginning farmers and socially disadvantaged farmers get better terms. For example, on a $2 million loan, a regular farmer might get 90 percent guaranteed, but a beginning or minority farmer would get 95 percent guaranteed. This 5 percent difference might not sound like much, but it makes a real difference to banks deciding whether to approve a loan. The bill also raises the maximum loan amount the government will guarantee from whatever it currently is to $4 million, and it automatically adjusts these numbers each year based on inflation so the program stays relevant as farm costs rise.

Who benefits most? New farmers trying to buy land or equipment, minority farmers who historically faced discrimination in lending, and ranchers making environmental improvements. Who might be affected negatively? Potentially taxpayers, since the government is taking on slightly more risk by guaranteeing higher percentages of these loans. However, the bill's supporters argue this investment helps keep farming viable and diverse, which benefits everyone through food security and rural economic development.

BALE Act of 2021

Bost, Mike

Beginning Agriculturalist Lifetime Employment Act of 2021 or the BALE Act of 2021 This bill revises the limits for the Department of Agriculture (USDA) conservation loan guarantee program. The bill replaces the existing 80% limit on the portion of a loan that USDA may guarantee with limits that range from 80%-90%, depending on the principal amount of the loan. For socially disadvantaged or beginning farmers or ranchers, the bill replaces the existing 90% limit with limits that range from 85%-95%, depending on the principal amount of the loan. The bill also (1) prohibits USDA from guaranteeing a loan under the program that exceeds $4 million, and (2) requires USDA to adjust the limits annually for inflation.