Last week the House and Senate passed a bill that aims to make it easier for family farmers with heavy debt loads to file for Chapter 12 bankruptcy; President Trump is expected to sign it.
The Family Farmer Relief Act of 2019, which had a slew of bipartisan co-sponsors in both chambers, expands bankruptcy access by increasing the debt limit from $3.2 million to $10 million. That change reflects an increase in land values since Chapter 12 was created in 1986. Farm bankruptcies are on the rise; the American Farm Bureau Federation says there have been 535 Chapter 12 filings since June 2018. "That's an increase of 13 percent; about half occurred in the Midwest," WHO-TV reports.
Chapter 12 enables farmers to deal with debt while still staying in business, much like Chapter 11 for other businesses; it also applies to fishers, but the bill applies just to farmers. Expanded access to it will help farmers dealing with increasing financial stress in recent years. "Net farm income has dropped by nearly half in the past five years, from $123 billion to $63 billion," Annie Gowen reports for The Washington Post in a recent story that illuminates that struggles of several family farmers.
The Family Farmer Relief Act of 2019, which had a slew of bipartisan co-sponsors in both chambers, expands bankruptcy access by increasing the debt limit from $3.2 million to $10 million. That change reflects an increase in land values since Chapter 12 was created in 1986. Farm bankruptcies are on the rise; the American Farm Bureau Federation says there have been 535 Chapter 12 filings since June 2018. "That's an increase of 13 percent; about half occurred in the Midwest," WHO-TV reports.
Chapter 12 enables farmers to deal with debt while still staying in business, much like Chapter 11 for other businesses; it also applies to fishers, but the bill applies just to farmers. Expanded access to it will help farmers dealing with increasing financial stress in recent years. "Net farm income has dropped by nearly half in the past five years, from $123 billion to $63 billion," Annie Gowen reports for The Washington Post in a recent story that illuminates that struggles of several family farmers.
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