A bill announced last week would ease the process of reorganizing debt through Chapter 12 bankruptcy rules, making more farms eligible. The move comes amid a continued downturn in the farm economy. Led by Representative Antonio Delgado, the legislation is the companion bill to a measure already filed in the Senate.
The New York Democrat says The Family Farmer Relief Act “will provide the critical restructuring and repayment flexibility” farmers need to get through hard times. Specifically, the legislation expands the debt cap that can be covered under Chapter 12 bankruptcy from $3.2 million to $10 million.
The changes reflect the increase in land values, as well as the growth over time in the average size of U.S. farming operations and are meant to provide farmers additional options to manage the downturn in the farm economy. The legislation is endorsed by the American Farm Bureau Federation and National Farmers Union. The bill will now be referred to the House Judiciary Committee for consideration.