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U.S. has paid more than $1M in interest for late bailout payments to farmers

“We had farmers waiting at the door from 7 o’clock in the morning to 7 o’clock at night. And if you’ve only got two people working at the counter ... it was just overwhelming,” one official said.
Image: US Farmer
A farmer pulls a planter through a soybean field at a farm field near Buda, Illinois, on July 2, 2019.Daniel Acker / Bloomberg via Getty Images file

Tens of thousands of farmers waited months for a payout from President Donald Trump's multibillion-dollar agricultural bailout program — a delay that has cost the government more than a million dollars so far this year.

Department of Agriculture employees in the Farm Belt have struggled to keep up with the Market Facilitation Program, an initiative designed by the Trump administration to mitigate losses from its disputes with China and other trading partners. The roughly $28 billion package has flooded county-level USDA offices, which process tariff aid in full and sometimes operate with only a few employees.

“We have never, ever had a program like this in nature,” said a county executive director at a Farm Service Agency in Missouri, who spoke on the condition of anonymity because local USDA staff were not authorized to discuss the program. “We had farmers waiting at the door from 7 o’clock in the morning to 7 o’clock at night. And if you’ve only got two people working at the counter, I mean it was just overwhelming.”

At least 31,597 farmers and ranchers received MFP payments late from January to April, according to USDA data obtained by NBC News through a Freedom of Information Act request. From the start of the program in September 2018 through August of this year, 596,851 applications had been submitted.

Payments that failed to meet a processing deadline of 30 days from application submission were considered late and began to accrue interest at a rate of about 3.6 percent. In the first half of the year, the government paid $1,046,392.72 in interest to farmers and ranchers whose MFP checks were delayed.

Except for in Arizona and Hawaii, local USDA offices in every state and Puerto Rico issued at least some payments late between January and June. Kansas paid $179,589 in interest during that period, the most in the country even though its program totals were lower than in other states. Offices in Missouri and Arkansas administered the next greatest amounts of interest, at $144,796 and $83,697, respectively.

“We’ve got more work than we can really get done in a single day,” said a county executive director at an FSA in Iowa, who spoke on the condition of anonymity for fear of being fired. “When you're taking in a few thousand MFP applications, plus certifying and everything else that goes into it, it’s time consuming. I think every office in the state is what I would call understaffed.”

The trade wars the Trump administration ignited in early 2018 came against a backdrop of other challenges across rural America, including historic flooding that severely delayed crop planting this year.

A record-long government shutdown in December and January added to setbacks for USDA staff and farmers. The legislative impasse over border security left the USDA shuttered, along with eight other Cabinet-level agencies for more than a month, during which no MFP applications were processed.

“That was the worst-timed shutdown for farmers that there's probably ever been,” said Michelle Jones, a fourth-generation wheat and grain farmer in Montana whose MFP payment was late this year. “It really disrupted planning because most farmers operate on a calendar year. There are always inconveniences with a shutdown, but not to the magnitude of that one.”

Another wave of MFP applications hit county offices in late July as the Trump administration remained in a trade standoff with China, which has since announced it would suspend all imports of American agricultural products.

At an estimated $16 billion, the cost of the second round of tariff aid was poised to be about one-third higher than last year. It came with added provisions that aimed to address allegations that large corporations had disproportionately benefited over smaller farms in the initial design.

County staffers said the application process appeared more straightforward this year, with the program also changed in part to reduce influence over planting decisions. But they added the overhaul would present another steep learning curve for offices that were already shorthanded.

“We're kind of learning on the fly,” said the county executive director in Iowa. “There are questions about this and about that, about what counts, what doesn’t count. That sets it apart from a more standard program. We don't have anything to go on.”

A USDA spokesperson said field staff were trained through conference calls and online modules prior to and after MFP sign-up periods. Asked whether the department expected the second tranche of payments to be processed more quickly, the spokesperson replied: “The first tranche of payments will begin this month.”

With an eye on his re-election campaign, Trump has increasingly sought to placate farmers who overwhelmingly supported him in 2016. But prolonged trade tensions and delayed aid has tested the loyalty of that constituency, which suffered disproportionate financial losses from retaliatory tariffs.

“It just caused frustration among the farmers, rather than feeling like the government recognizes that I'm getting hit by these tariffs,” a former top USDA official who served several years under President George W. Bush said of MFP. " So I think it also created something of a challenge.”

The White House did not respond to an NBC News request for comment.