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Matt Kempner: Georgia farm troubles lead to spike in bankruptcy action

Matt Kempner, The Atlanta Journal-Constitution on

Published in Business News

The aid payments began Oct. 18, just over a year after Hurricane Michael struck. About $5.5 million was paid out to Georgia producers through October, a USDA spokesperson wrote in an email to The Atlanta Journal-Constitution.

Payments have been made on about 18% of Georgia applications, which have now risen to more than 2,300, according to the department. The program is designed to cover between 70 and 95% of the expected value of certain kinds of agriculture losses, after reducing for things such as insurance payouts and lowered expenses.

The assistance for growers "may help some hang on," said Dave Orlowski, who represents several small lenders as an Albany-based attorney with Drew Eckl & Farnham.

Still, Orlowski said, prices are low for peanuts and cotton, two crucial Georgia crops. Some farmers still owe debts that were supposed to be paid for 2017 and 2018, he said.

Caseloads are rising, said Walter Kelley, who serves as trustee on farm cases in the U.S. Bankruptcy Court's Middle District of Georgia. He has about 90 open bankruptcy cases, including some filed in the last year.

"I think we are going to have more in 2020," Kelley said, adding later, "There is great uncertainty in the farm economy at the moment."

 

According to the Farm Bureau, the federal government projects that nearly 40% of U.S. farm income for 2019 will be tied to trade and disaster assistance, the farm bill and insurance payments.

(c)2019 The Atlanta Journal-Constitution (Atlanta, Ga.)

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