Farmers, Food Banks Describe ‘Chaos’ of USDA Grant Suspensions

By Christopher Ingraham

Tom Smude is a farmer who operates a sunflower processing plant in Morrison County. Last year his business was awarded a $500,000 grant through the USDA’s Resilient Food Infrastructure Systems Program to bulk up their processing of sunflower byproduct, which is used to make cereals and other foods.

Smude has already ordered much of the equipment for the expansion, taking out a temporary loan to cover the cost while waiting for the federal reimbursement to come in. But now, thanks to the Trump administration’s chaotic freeze on loan and grant programs, that reimbursement is in limbo. 

“The challenge is we tore out our line, now we’re not making any product,” he said during a state Senate agriculture committee hearing this week. “I don’t know what to do.”

Smude was among the farmers, food manufacturers, and food bank representatives who testified about how the administration’s actions were affecting them and their customers.

Brady Barnstable owns Seven Sundays, a Minneapolis food manufacturer that uses Smude’s sunflower products to make cereals sold at Wal-Mart, Costco and other big retailers. He told senators that several of his upcoming contracts are dependent on increased output from Smude’s processing operation, and are now in jeopardy.

“We don’t really have a Plan B,” he said.

Hannah Bernhardt, who runs a livestock operation in Finlayson, said that she’s been affected by a freeze on the USDA’s Local Food Purchase Assistance program, which local governments use to buy food from farmers and distribute to food banks and other organizations.

“I was all set to sell three more beef to the LFPA program this March when I was informed that the funding freeze meant they would be unable to buy from me,” she said. “Now I’m worried about scrambling to find new customers to buy that beef.”

She’s also had to hold off buying seed for cover crops because a grant through the Conservation Stewardship Program is now on hold.

“I hope the federal government will honor their commitments to farmers,” she said. “When I sign a contract with the government, I should be able to plan ahead for my season and count on that.”

The committee also heard from representatives of Minnesota food banks, who said that as a result of grant suspensions they’ve had to stop purchasing various foods from local farmers.

“We have had absolutely no communication from USDA,” said Sophia Lenarz-Coy, executive director of The Food Group, a nonprofit.

Farming is heavily subsidized, with government payments accounting for about 20% of Minnesota farm income in recent years. The bulk of those subsidy payments go to the biggest, wealthiest farm businesses, but smaller operations rely on them too.

Courts have ordered the Trump administration to resume all grant and loan payments while the executive orders are litigated. But like their peers in Minnesota, farmers in the rest of the country are reporting that they are unable to access previously promised funds.

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