Lawsuit Demands USDA Restore $127M in Grants

A significant legal battle is brewing as 24 organizations and local governments are suing the U.S. Department of Agriculture (USDA). The core of the lawsuit? The demand to reinstate $127 million in grants that were cancelled from the Increasing Land, Capital, and Market Access (LCM) program. This program, established under the Biden administration, aimed to support underserved producers, but faced abrupt termination.

The LCM Program’s Mission

Funded by the Inflation Reduction Act and the American Rescue Plan Act, the LCM program was designed to provide crucial support to farmers and communities that have historically lacked access to resources. Since its inception in 2023, it has distributed nearly $300 million in federal aid.

The program focused on community-led projects, offering everything from down payment assistance and low-interest loans to training for new farmers, equipment, technical guidance, and support for infrastructure and market access. It was a vital lifeline for the next generation of agricultural professionals.

Allegations of Unlawful Termination

However, under the Trump administration, many of these grants were abruptly cancelled. Steven Peterson, Associate Administrator for the Farm Service Agency, reportedly cited concerns that the program was ‘discriminatory’ and involved ‘wasteful spending.’ But the plaintiffs argue this justification is unfounded.

The lawsuit, which joins a previous one filed in 2025, claims the government has failed to provide evidence that the terminated grants were indeed linked to ‘waste, fraud, and abuse.’ Amanda Koehler, a young farmer and manager of the LCM Network, stated that the program was the government’s most significant effort to tackle the challenges faced by new producers.

The Plaintiffs and Their Demands

The list of plaintiffs is extensive, including organizations like the Farmers Collaborative, African Alliance of Rhode Island, Black Oregon Land Trust, NDN Collective, and many others dedicated to supporting sustainable agriculture and underserved communities. They are demanding the court reverse the $127 million in cancelled grants.

This lawsuit builds upon an existing case, USDN v. USDA, initially filed in June 2025. A significant development occurred in August 2025 when the U.S. District Court for the District of Columbia granted a preliminary injunction, reinstating six grants. Plaintiffs are hopeful for a similar outcome in their case.

Concerns Over Administrative Processes

The plaintiffs are also pushing for the court to compel the defendants to complete an administrative record detailing the termination processes, or face sanctions. They allege that the USDA’s review process for cancellations involved simple keyword searches for terms related to diversity, equity, inclusion, or climate change, raising concerns about the validity of the cancellations.

Scott Carlson, executive director of the Farmers Justice Center, commented that these cancellations are particularly damaging during a fragile farm economy, cutting off access to land, capital, and markets for producers who historically haven’t had adequate government support. The call is for the courts to hold the administration accountable and protect vital programs for American farmers.