Federal Agricultural Mediation Programs Should Be Continued, Expanded

A federal program created by Congress in 1987 to help America’s farmers navigate economic challenges that threaten their livelihoods and endanger the nation’s food supply by providing them with access to mediation services as a way to resolve legal disputes should be continued and, in fact, expanded.

That’s the view of Debra Burke, professor of business administration and law in Western Carolina University’s College of Business. Burke, who directs statewide agricultural mediation programs in North Carolina and neighboring Virginia, has closely monitored the impact of the Agricultural Credit Act of 1987 and the related Agricultural Mediation Program on assisting farmers in avoiding foreclosures and navigating complex regulations and legal issues.

“Farming and ranching can be a precarious vocation, at the mercy of economic policy, nature and, most recently, the mischief wreaked by a pandemic. The U.S. Department of Agriculture’s mediation program helps farmers who find themselves in a financially distressful situation by providing an avenue to resolve the problem short of foreclosure or bankruptcy, as well as other production issues,” Burke said. “The program provides a cost-effective alternative to appeals or expensive litigation and bankruptcy, and helps avoid the associated stress of those options.”

Previous expansions of approved services that are part of the program, including those that came through the 2018 Farm Bill, have proven effective in increasing farmers’ access to mediation, she said.

“This is an indicator of both the need for and success and success of the Agricultural Mediation Program,” Burke said. “I believe that continued congressional financial support for the expansion of the program would have a seismic positive effect on America’s farmers.”

Burke, who also serves as executive director of the N.C. Agricultural Mediation Program (NCAMP) and Farm Agricultural Resources and Mediation of Virginia (FARMVA), shared her research and insights about the program in a paper titled "The Expansion of the Federal Agricultural Mediation Program: A Promising Signal” published by the Cumberland Law Review.

NCAMP works to help settle disputes between USDA agencies in North Carolina and their customers and clients and seek resolution of disputes involving agricultural issues, while FARMVA provides similar mediation services in Virginia. Both granted-funded affiliate programs are housed in WCU’s College of Business.

The late Jayne Zanglein, who taught mediation and law at WCU for 15 years and was a professor emeritus in the College of Business, secured the original USDA grant funding and established both states’ programs several years ago. The North Carolina and Virginia programs based out of WCU’s College of Business are among 43 certified state agricultural mediation programs funded annually.

NCAMP and FARMVA provide mediation for farmers and ranchers, their creditors and others directly affected by USDA adverse decisions including foreclosures, loan denials, crop insurance disputes, wetlands determinations, disputes with agricultural lenders, and disputes with vendors. Covered services are provided at no charge, with costs underwritten by the federal grant funding, Burke said.

“When a farmer defaults and foreclosure is threatened, the relationship is between borrower and lender is compromised; therefore, mediation offers an alternative to foreclosure, allowing the borrower to work out a reasonable repayment structure while avoiding stockpiled agricultural acreage for the lender,” she said. “The Agricultural Mediation Program also provides a forum to fulfill the obligation of federal farm lenders to consider options short of foreclosure, such as loan restructuring, with positive overall results.  The successful mediation of distressed farm loans stabilizes land values, reduces turnover and increases the long-term prosperity of the agricultural community.”

Unlike other forms of conflict resolution, the mediation process encourages calm, rational discussion by all parties to set goals and options and to create a plan that will benefit lenders and borrowers alike, Burke said.

“Experience suggests that the process provides invaluable assurance that farm families and their lenders had both been heard and treated as fairly as possible,” she said. “In the agricultural context, mediation is a particularly well-suited dispute resolution tool because the creditor and lender will likely have an ongoing working relationship. An agreed settlement can keep acreage in production, which benefit not only the parties, but also the community at large.”

The most recent Farm Bill approved by Congress expanded the mediation program to include issues that fall under the National Organic Program and to provide services for issues such as family farm transition and neighbor disputes. The statute also allowed the program to provide financial counseling so that farmers not only are prepared for going through the mediation process, but also be better equipped to avert a financial crisis in the first place, she said.

With millions of acres of farmland expected to be transferred in the next few years, resolving farm succession and family farm transition issues is particularly important, and the program’s mediators have recently received training on that process, she said.

“Leveraging the existing infrastructure of the Agricultural Mediation Program to provide such outreach is a solid strategy,” Burke said. “From my vantage point, such support is well-placed, and continued investment in the program represents tax dollars well-spent.”

For information or to seek mediation services, visit https://affiliate.wcu.edu/agriculturalmediation/.