Bankruptcy Bill Would Raise Farm Debt Coverage to $10M

A growing coalition of lawmakers seeks to overhaul bankruptcy rules as farmers and ranchers continue to face economic challenges.

House Agriculture Chairman Collin Peterson (D-Minn.) is supporting a new bipartisan bill from freshman Rep. Antonio Delgado (D-N.Y.) that would raise the amount of farm debt covered under Chapter 12 bankruptcy to $10 million—effectively making the option available to more farmers.

Sen. Chuck Grassley (R-Iowa) is pushing similar legislation with bipartisan backing in the Senate.

Farmers currently must have less than $4.15 million in debt to qualify for Chapter 12 bankruptcy, per the Congressional Research Service. The debt threshold, which was set in the 1980s, doesn’t reflect the growth in average farm size or the rise in farmland values, according to proponents of the measure.

The American Farm Bureau Federation and the National Farmers Union are both on board with the proposal.

The House and Senate Judiciary panels have jurisdiction over the measures; neither committee has scheduled a review.

Source: Politico