Black Farmers and Socially Disadvantaged Farmers Increased Market Share Act
Bill: H.R.4169 | Sponsor: Rep. Scott, David (D-GA)
Policy area: Agriculture and Food

Summary:
Black Farmers and Socially Disadvantaged Farmers Increased Market Share Act
This bill addresses ways to increase market access for socially disadvantaged farmers and ranchers and to ensure civil rights accountability for Department of Agriculture (USDA) employees. (Socially disadvantaged farmers and ranchers are those who have been subjected to racial or ethnic prejudice because of their identity as members of a group without regard to individual qualities.)
Specifically, USDA must establish a program to make grants to support new or expanding food hubs designed to increase market access for socially disadvantaged farmers and ranchers.
USDA shall establish a process to prioritize the purchase of agricultural food products from socially disadvantaged farmers and ranchers. That process must account for barriers to market entry faced by socially disadvantaged farmers and ranchers while maintaining the integrity of the purchasing process.
The bill also establishes an agriculture hub income tax credit, which shall be an amount equal to 25% of the qualified food hub expenses for the taxable year.
USDA must (1) ensure that its officials and employees are held accountable for engaging in discriminatory or retaliatory actions, harassment, civil rights violations, or related misconduct; and (2) bear the burden of proving by substantial evidence that an adverse decision was valid.

To increase market access for Black farmers and socially disadvantaged 
 farmers and ranchers, to ensure civil rights accountability, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Black Farmers and Socially 
Disadvantaged Farmers Increased Market Share Act''.

SEC. 2. FOOD HUB GRANTS TO INCREASE MARKET ACCESS FOR SOCIALLY 
              DISADVANTAGED FARMERS AND RANCHERS.

    (a) Definitions.--In this section:
            (1) Agricultural food product.--The term ``agricultural 
        food product'' means a raw, cooked, or a processed edible 
        substance, beverage, or ingredient produced and otherwise 
        prepared for sale in the United States (including any insular 
        area (as defined in section 1404 of the National Agricultural, 
        Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
        3103))), derived from one or more agricultural commodities of 
        United States origin, and used or intended for use or for sale 
        in whole or in part for human consumption. 
            (2) Donated food.--The term ``donated food'' has the 
        meaning given the term in section 250.2 of title 7 of the Code 
        of Federal Regulations (or any successor regulation).
            (3) Eligible entity.--The term ``eligible entity'' means--
                    (A) an entity formed by two or more agricultural 
                producers, not less than half of whom are members of a 
                socially disadvantaged group; or
                    (B) a non-profit organization or Tribal 
                organization with demonstrated experience working with 
                socially disadvantaged farmers or ranchers.
            (4) Eligible partner.--The term ``eligible partner'' means 
        a non-profit organization, a State cooperative extension 
        service or a college or university (as such terms are defined 
        in section 1404 of the National Agricultural Research, 
        Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)), 
        Tribal organization, or other State or local government 
        entities with demonstrated experience in providing assistance 
        such as grants management, technical assistance, and business 
        plan development, to agricultural producers.
            (5) Food hub.--The term ``food hub'' means a business or 
        organization that actively manages the aggregation, 
        distribution, and marketing of source-identified agricultural 
        food products from producers for wholesale, retail, or 
        institutional markets.
            (6) Secretary.--The term ``Secretary'' means the Secretary 
        of Agriculture.
            (7) Socially disadvantaged farmer or rancher.--The term 
        ``socially disadvantaged farmer or rancher'' has the meaning 
        given the term in section 2501(a) of the Food, Agriculture, 
        Conservation, and Trade Act of 1990 (7 U.S.C. 2279(a)).
            (8) Socially disadvantaged group.--The term ``socially 
        disadvantaged group'' has the meaning given the term in section 
        2501(a) of the Food, Agriculture, Conservation, and Trade Act 
        of 1990 (7 U.S.C. 2279(a)).
            (9) Tribal organization.--The term ``Tribal organization'' 
        has the meaning given the term in section 3 of the Food and 
        Nutrition Act of 2008 (7 U.S.C. 2012).
    (b) Grants to Increase Market Access.--
            (1) In general.--The Secretary shall establish a program to 
        make grants on a competitive basis to eligible entities to 
        support new or expanding food hubs designed to increase market 
        access for socially disadvantaged farmers and ranchers, but may 
        also increase market access for other farmers and ranchers.
            (2) Use of funds.--An eligible entity selected to receive a 
        grants under this subsection may use grants funds--
                    (A) to purchase and develop land, buildings, and 
                associated infrastructure for commercial or industrial 
                properties, including expansion or modernization, for 
                use in processing, distributing, aggregating, storing, 
                transporting, or marketing agricultural food products;
                    (B) to construct or equip facilities for use in 
                processing, distributing, aggregating, storing, 
                transporting, or marketing agricultural food products;
                    (C) to purchase machinery and equipment for use in 
                processing, distributing, aggregating, storing, 
                transporting, or marketing agricultural food products;
                    (D) for general operating expenses directly related 
                to a food hub, including planning and development 
                related to the establishment or expansion of any food 
                hub;
                    (E) to provide marketing services for agricultural 
                food products, including providing platforms (such as 
                electronic or web-based platforms) for sales, 
                inventory, and aggregation; and
                    (F) to conduct other activities supporting the 
                development or expansion of a food hub, as determined 
                by the Secretary.
            (3) Application.--
                    (A) In general.--An eligible entity seeking a grant 
                under this subsection shall submit to the Secretary an 
                application that contains--
                            (i) a description of the activities the 
                        eligible entity will carry out to support one 
                        or more new or existing food hubs, including a 
                        plan for each such food hub to process, 
                        distribute, store, or market agricultural food 
                        products for wholesale, retail, or 
                        institutional markets;
                            (ii) a description of the ways in which 
                        each such food hub that the eligible entity is 
                        proposing to establish or expand is designed to 
                        increase market access for socially 
                        disadvantaged farmers or ranchers;
                            (iii) except as provided in subparagraph 
                        (B), a description of the eligible entity's 
                        demonstrated competency to develop and manage 
                        each such food hub, provide fiscal 
                        accountability, collect data, and prepare 
                        reports and other necessary documentation; and
                            (iv) any other information, as determined 
                        by the Secretary.
                    (B) Requirement to include eligible partners.--An 
                eligible entity that does not have one or more of the 
                demonstrated competencies described in clause (iii) of 
                subparagraph (A) shall submit to the Secretary in its 
                application--
                            (i) a list of one or more eligible partners 
                        such eligible entity is partnering with;
                            (ii) the responsibilities of each eligible 
                        partner in supporting such eligible entity; and
                            (iii) a description of the demonstrated 
                        competencies of the eligible partner or 
                        partners in performing such responsibilities.
                    (C) Eligible entities serving as eligible 
                partners.--An eligible entity specified in subparagraph 
                (B) of subsection (a)(3) seeking a grant under this 
                section may serve as an eligible partner for other 
                eligible entities in one or more grant applications 
                under this subsection.
            (4) Priority.--In making grants under this subsection, the 
        Secretary may give priority to grant applications for food hubs 
        that--
                    (A) benefit underserved communities, as defined in 
                section 310B(g)(9)(A)(ii) of the Consolidated Farm and 
                Rural Development Act (7 U.S.C. 1932(g)(9)(A)(ii));
                    (B) aggregate, distribute, and market agricultural 
                food products that meet the standards for donated 
                foods, as determined by the Secretary; or
                    (C) have not been awarded a Department of 
                Agriculture grant, including a grant under section 210A 
                of the Agricultural Marketing Act of 1946 (7 U.S.C. 
                1627c), in the preceding or current fiscal year.
            (5) Maximum grant term.--The term of a grant under this 
        subsection may not exceed 5 years.
            (6) No matching funds.--An eligible entity receiving a 
        grant under this section shall not be required to provide non-
        Federal matching funds with respect to such grant.
    (c) Prioritizing Purchases for USDA Domestic Food Assistance 
Programs.--
            (1) In general.--The Secretary shall establish a process--
                    (A) to prioritize the purchase of agricultural food 
                products from socially disadvantaged farmers and 
                ranchers, including from food hubs developed or 
                expanded under this section, for use in Department of 
                Agriculture programs that distribute agricultural food 
                products within the United States (including any 
                insular area (as defined in section 1404 of the 
                National Agricultural, Research, Extension, and 
                Teaching Policy Act of 1977 (7 U.S.C. 3103))); and
                    (B) that is designed to account for barriers to 
                market entry faced by socially disadvantaged farmers 
                and ranchers while maintaining the integrity of the 
                purchasing process established under this subsection, 
                including ensuring that any entity that is suspended or 
                debarred from participation in any Federal program is 
                not eligible to participate in the purchasing process 
                established under this subsection. 
            (2) Waivers.--
                    (A) In general.--In establishing the process 
                described in paragraph (1), the Secretary may provide 
                for the waiver of the full and open competition 
                procedures for the award of Federal contracts, section 
                3324 of title 31, United States Code, and section 725 
                of the Agriculture, Rural Development, Food and Drug 
                Administration, and Related Agencies Appropriations 
                Act, 2001 (7 U.S.C. 2209f), if the Secretary identifies 
                requirements under such sections and procedures as 
                presenting barriers to market entry for socially 
                disadvantaged farmers and ranchers.
                    (B) Notification.--Not later than 10 days after 
                providing for any waiver under subparagraph (A), the 
                Secretary shall notify the Committee on Agriculture of 
                the House of Representatives and the Committee on 
                Agriculture, Nutrition, and Forestry of the Senate of 
                such waivers and provide a description of how such 
                waivers would address barriers to market entry for 
                socially disadvantaged farmers and ranchers for a 
                particular agricultural food product.
    (d) Reports.--Not later than December 31, 2022, and each December 
thereafter until the completion of the grants awarded under subsection 
(b), the Secretary shall make publicly available on the Department of 
Agriculture's website and submit to the Committee on Agriculture of the 
House of Representatives and the Committee on Agriculture, Nutrition, 
and Forestry of the Senate, a report that includes--
            (1) a description of the status of each grant awarded under 
        subsection (b);
            (2) the number of socially disadvantaged farmers and 
        ranchers participating in the food hub supported by such grant 
        in the previous fiscal year;
            (3) to the maximum extent practicable, the amount of 
        agricultural food products produced by socially disadvantaged 
        farmers and ranchers processed, distributed, aggregated, 
        stored, or marketed by the food hub supported by such grant in 
        the previous fiscal year; and
            (4) the total amount of donated food purchased by the 
        Secretary from food hubs supported with grants awarded under 
        this section in the previous fiscal year.
    (e) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out subsection (b) $100,000,000 for fiscal year 
2022, to remain available until expended.

SEC. 3. AGRICULTURE HUB CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45U. AGRICULTURE HUB CREDIT.

    ``(a) In General.--For purposes of section 38, the agriculture hub 
credit determined under this section for any taxable year is an amount 
equal to 25 percent of the qualified food hub expenses for the taxable 
year.
    ``(b) Qualified Food Hub Expenses.--For purposes of this section, 
the term `qualified food hub expenses' means amounts paid or incurred 
by the taxpayer during the taxable year--
            ``(1) for agricultural food products from a food hub 
        developed or expanded under section 2 of the Black Farmers and 
        Socially Disadvantaged Farmers Increased Market Share Act, and
            ``(2) in accordance with a contract certified by the 
        Secretary of Agriculture under section 3(c) of the Black 
        Farmers and Socially Disadvantaged Farmers Increased Market 
        Share Act.
    ``(c) Food Hub.--The term `food hub' has the meaning given such 
term in section 2 of the Black Farmers and Socially Disadvantaged 
Farmers Increased Market Share Act.
    ``(d) Termination.--This section shall not apply to taxable years 
beginning after the Secretary determines the grant program under 
section 2 of the Black Farmers and Socially Disadvantaged Farmers 
Increased Market Share Act has ended.''.
    (b) Conforming Amendments.--
            (1) Section 38(b) of the Internal Revenue Code of 1986 is 
        amended--
                    (A) in paragraph (32), by striking ``plus'' at the 
                end,
                    (B) in paragraph (33), by striking the period at 
                the end and inserting ``, plus'', and
                    (C) by adding at the end the following new 
                paragraph:
            ``(34) the agriculture hub credit determined under section 
        45U(a).''.
            (2) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1 of such Code is amended by adding at 
        the end the following new item:

``Sec. 45U. Agriculture hub credit.''.
            (3) Section 280C of such Code is amended by adding at the 
        end the following new subsection:
    ``(i) Agriculture Hub Credit.--Any deduction or other credit 
otherwise allowable with respect to an expense for which a credit is 
allowed under section 45U(a) shall be reduced by the amount of the 
credit under section 45U(a) with respect to such expense. If a credit 
is allowed under section 45U(a) with respect to property of a kind 
which would properly be included in the inventory of the taxpayer if on 
hand at the close of the taxable year or property held by the taxpayer 
primarily for sale to customers in the ordinary course of the trade or 
business of such taxpayer, opening inventory or purchases shall be 
reduced by the amount of the credit so allowed.''.
    (c) Certification Process.--Not later than 1 year after the date of 
enactment of this section, the Secretary of Agriculture shall issue 
regulations to establish a process to certify, at the request of 
entities seeking an agriculture hub credit section 45U of the Internal 
Revenue Code of 1986, as added by subsection (b), that a contract under 
which expenditures referred to in such section 45U are made--
            (1) is not between related parties;
            (2) is the result of arm's length negotiations; and
            (3) meets any other requirements, as determined by the 
        Secretary of Agriculture, in consultation with the Secretary of 
        Treasury.
    (d) Effective Date.--The amendments made by this section shall 
apply to expenses paid or incurred in taxable years beginning after 
December 31, 2021.

SEC. 4. CIVIL RIGHTS ACCOUNTABILITY FOR USDA EMPLOYEES.

    (a) In General.--The Secretary of Agriculture shall ensure that 
officials and employees of the Department of Agriculture are held 
accountable in accordance with subsection (b) if, while in the course 
of their employment or in administering a Department of Agriculture 
program, such officials and employees are found to have engaged in any 
discriminatory actions, retaliatory actions, harassment, civil rights 
violations, or related misconduct, including any such actions or 
misconduct involving any of the following:
            (1) Failure to provide a receipt for service in accordance 
        with section 2501A(e) of the Food, Agriculture, Conservation or 
        Trade Act of 1990 (7 U.S.C. 2279-1(e)) to any current or 
        prospective applicants of or participants in Department of 
        Agriculture programs.
            (2) Providing an inaccurate receipt for service under such 
        section 2501A(e) to any current or prospective applicants of or 
        participants in Department of Agriculture programs.
            (3) Failure to provide appropriate information regarding 
        relevant programs and services at the Department of 
        Agriculture, when requested by any current or prospective 
        applicants of or participants in Department of Agriculture 
        programs.
            (4) Failure to timely process applications or otherwise 
        delaying program services to any current or prospective 
        applicants of or participants in, Department of Agriculture 
        programs.
    (b) Taking Corrective Action.--The Secretary shall ensure that 
appropriate corrective action is taken with respect to any official or 
employee of the Department of Agriculture who has been found to have 
engaged in any of the actions, violations, or misconduct referred to in 
subsection (a) while in the course of such official's or employee's 
employment or in administering a Department of Agriculture program--
            (1) in any administrative finding by the Department of 
        Agriculture, including any final agency decision issued by the 
        Assistant Secretary of Agriculture for Civil Rights and any 
        civil rights compliance review or misconduct investigation 
        conducted by the Department of Agriculture;
            (2) in any administrative or judicial proceeding;
            (3) in any civil rights settlement;
            (4) in any audit or investigation conducted by the Office 
        of the Inspector General of the Department of Agriculture; or
            (5) in any investigation conducted by the Office of the 
        Special Counsel.
    (c) Corrective Action Defined.--In this section, the term 
``corrective action'' means any action taken to respond to any of the 
actions, violations, or misconduct referred to in subsection (a) that--
            (1) would enhance civil rights at the Department of 
        Agriculture, including any policy or programmatic changes to 
        prevent similar misconduct from occurring in the future; and
            (2) may include disciplinary actions, including--
                    (A) removal from Federal service;
                    (B) suspension without pay;
                    (C) any reduction in grade or pay; and
                    (D) letter of reprimand.

SEC. 5. EQUITABLE RELIEF.

    (a) Equitable Relief From Ineligibility for Loans, Payments, or 
Other Benefits.--Section 1613 of the Farm Security and Rural Investment 
Act of 2002 (7 U.S.C. 7996) is amended--
            (1) by redesignating subsections (f) through (j) as 
        subsections (g) through (k), respectively;
            (2) by inserting after subsection (e) the following:
    ``(f) Equitable Relief by the Assistant Secretary of Agriculture 
for Civil Rights.--
            ``(1) In general.--The Assistant Secretary of Agriculture 
        for Civil Rights (or a designee of the Secretary in the Office 
        of the Assistant Secretary for Civil Rights, if no Assistant 
        Secretary of Agriculture for Civil Rights is confirmed in 
        accordance with section 218(b) of the Department of Agriculture 
        Reorganization Act of 1994 (7 U.S.C. 6918(b))) may grant relief 
        in accordance with subsections (b) through (d) to a participant 
        who files a civil rights program complaint.
            ``(2) Decisions.--The decision by the Assistant Secretary 
        of Agriculture for Civil Rights (or the designee of the 
        Secretary) to grant relief under this subsection--
                    ``(A) shall not require prior approval by any 
                officer or employee of the Department of Agriculture; 
                and
                    ``(B) is subject to reversal only by the Secretary 
                (who may not delegate the reversal authority).
            ``(3) Other authority.--The authority provided to the 
        Assistant Secretary of Agriculture for Civil Rights (or the 
        designee of the Secretary) under this subsection is in addition 
        to any other applicable authority and does not limit other 
        authority provided by law or the Secretary.'';
            (3) in subsection (g), as so redesignated, by striking ``or 
        the State Conservationist'' and inserting ``the State 
        Conservationist, or the Assistant Secretary of Agriculture for 
        Civil Rights (or the designee of the Secretary)''; and
            (4) in paragraph (1) of subsection (h), as so redesignated, 
        by striking ``and (e)'' and inserting ``(e), and (f)''.
    (b) Equitable Relief for Actions Taken in Good Faith.--Section 366 
of the Consolidated Farm and Rural Development Act (7 U.S.C. 2008a) is 
amended--
            (1) by amending subsection (b) to read as follows:
    ``(b) Limitation.--The Secretary may only provide relief to a 
farmer or rancher under subsection (a) if the Secretary determines that 
the farmer or rancher--
            ``(1) acting in good faith, relied on an action of, or the 
        advice of, the Secretary (including any authorized 
        representative of the Secretary) to the detriment of the 
        farming or ranching operation of the farmer or rancher; or
            ``(2) failed to comply fully with the requirements of a 
        program described in subsection (a)(1), but made a good faith 
        effort to comply with the requirements.'';
            (2) by inserting after subsection (d) the following:
    ``(e) Equitable Relief by the Assistant Secretary of Agriculture 
for Civil Rights.--
            ``(1) In general.--The Assistant Secretary of Agriculture 
        for Civil Rights (or a designee of the Secretary in the Office 
        of the Assistant Secretary for Civil Rights, if no Assistant 
        Secretary of Agriculture for Civil Rights is confirmed in 
        accordance with section 218(b) of the Department of Agriculture 
        Reorganization Act of 1994 (7 U.S.C. 6918(b))) may grant relief 
        in accordance with subsections (a) through (d) to an individual 
        who files a civil rights program complaint.
            ``(2) Decisions.--The decision by the Assistant Secretary 
        of Agriculture for Civil Rights (or the designee of the 
        Secretary) to grant relief under this subsection--
                    ``(A) shall not require prior approval by any 
                officer or employee of the Department of Agriculture; 
                and
                    ``(B) is subject to reversal only by the Secretary 
                (who may not delegate the reversal authority).
            ``(3) Other authority.--The authority provided to the 
        Assistant Secretary of Agriculture for Civil Rights (or the 
        designee of the Secretary) under this subsection is in addition 
        to any other applicable authority and does not limit other 
        authority provided by law or the Secretary.'';
            (3) by redesignating subsection (e) as subsection (f); and
            (4) in subsection (f), as so redesignated, by striking 
        ``Secretary'' and inserting ``Secretary, or the Assistant 
        Secretary of Agriculture for Civil Rights (or the designee of 
        the Secretary)''.

SEC. 6. BURDEN OF PROOF FOR NATIONAL APPEALS DIVISION HEARINGS.

    Section 277(c)(4) of the Department of Agriculture Reorganization 
Act of 1994 (7 U.S.C. 6997(c)(4)) is amended to read as follows:
            ``(4) Burden of proof.--The agency shall bear the burden of 
        proving by substantial evidence that the adverse decision of 
        the agency was valid.''.
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