On Friday President Donald Trump signed into law legislation raising the debt ceiling to $10 million for Chapter 12 bankruptcies. Authored by Sen. Chuck Grassley (R-Iowa), the Family Farmer Relief Act expands farmer access to Chapter 12 debt reorganization procedures.
“More than 30 years ago, Congress created tools to help family farmers reorganize their debts and get back on their feet. Since then, the price of farmland has increased dramatically, forcing small farmers to take on more debt. Low commodity prices have pushed farm debts even higher,” Grassley said in a statement. “The Family Farmer Relief Act recognizes these realities and adjusts the law accordingly. It’s a simple one-sentence bill, but it can make a world of difference for American farm families. I applaud President Trump’s action today to expand these safeguards for America’s farmers.”
American Farm Bureau President Zippy Duval said the law is a sobering reflection of the current state of the farm economy, but the organization is grateful President Trump prioritized this bill.
"Farm Bureau is appreciative that the Family Farmer Relief Act of 2019 is now law. This law relieves some of the uncertainty farmers are facing due to export market disruptions, weather events and declining farm income,” he said in a statement. “It will help family farmers reorganize after falling on hard times by increasing the debt limit for relief eligibility under the Chapter 12 bankruptcy code.”
Chapter 12, a bankruptcy code created in 1980s specifically for farmers, has been modified by Congress several times in the last 30 years. Before the Family Farmer Relief act, the debt limit was $4.1 million to qualify.
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