Student debt could cost this Maine family the farm

This story was originally published on the Bangor Daily News website on May 22, 2017, as found here.

DOVER-FOXCROFT, Maine — The 175 acres of forest and farmland that’s home to Leaves and Blooms Greenhouse on Route 15 has been in Jackie Robinson’s family for four generations.

But because of the damage that defaulting on her student loan payments has done to Robinson’s credit, it’s uncertain whether the farm will continue in the family for a fifth generation.

“No longer am I a young farmer, no longer do my 20 years of work matter, and I still owe this debt for this [education] that I’m using. It’s heartbreaking really,” Robinson said. “And because it’s a federal debt I’ve never had credit anywhere.”

Robinson, 41, dropped out of college her junior year to pursue her passion for farming, leaving her with about $39,000 in student loan debt. Having acquired her debt prior to the era of consolidation and alternative repayment plans, making payments while starting out as a young farmer proved difficult, and ultimately her loans went into default because she was unable to pay them as a single mother on a farming income.

Now in a monthly repayment plan she can manage, Robinson is chipping away at paying back the $20,000 in debt she has remaining. But until she gets her balance squared away, the odds of her securing a bank loan to buy the family farm from her parents — who are in their 60s — are very unlikely.

But one of Maine’s most famous farmers, U.S. Rep. Chellie Pingree, D-Maine, is looking to prevent this scenario from being the case for the latest wave of young farmers. Pingree is a co-sponsor of a bill that would add farmers to the category of individuals who could qualify for federal student debt forgiveness after completing 10 years of income based repayment on their loans.

On her own farm on the island of North Haven, Pingree said the majority of her employees have gone to college and some have even pursued master’s degrees. While this makes them capable employees who are good managers and creative problem solvers, Pingree said any debt they acquired to pay for their education can weigh them down while trying to pursue a career on a farm.

“It’s a huge issue,” Pingree said. “A lot of people go to college, get an English literature degree, they work on a farm a couple of summers and they’re like, ‘Oh my God, this is what I want to do, I want to have kids and raise them on a farm.’ And they’re wonderful at it, but [student debt] is something I’ve talked to a lot of young people about, and it’s something I’ve seen employees of mine really struggle with.”

The bill, the Young Farmer Success Act, seeks to amend the Higher Education Act to add qualified farmers and ranchers to the list of individuals who are eligible for loan forgiveness under the Federal Direct Loan program because they are classified as being employed in public service. Occupations where workers presently qualify for loan forgiveness after paying on their student loans for 10 years include any level of government, military service, public health, public education, social work, nonprofit organizations, among other professions.

But a portion of the Trump administration’s proposed education budget that was obtained by the Washington Post last week is causing concern among those pushing for the Young Farmer’s Success Act because the proposal calls for eliminating federal loan forgiveness.

“We’re very concerned about that if that’s [the administration’s] starting point,” Andrew Bahrenburg, national policy director for the National Young Farmers Coalition, said.

An Education Department spokeswoman told the Post that all budget numbers are preliminary until the final proposal is released next week. While the administration releases budget proposals, it is Congress that passes appropriation bills and would ultimately have the final say on the survival of federal loan forgiveness for public service employees.

The Young Farmer Success Act, sponsored by U.S. Rep. Joe Courtney, D-Connecticut, was introduced in February with the bipartisan support of seven co-sponsors, including four democrats and three republicans. The legislation has been referred to the House Committee on Education and the Workforce for further review.

While ultimately if this bill is passed, Robinson would not qualify for forgiveness because she acquired her loans before 2007, and at 41 no longer qualifies as a “young farmer,” she said having access to help like this when she was struggling with debt while pursuing her farming dreams would’ve made all the difference.

“If I had that opportunity, it would have just changed so many things, and I would have felt empowered by it too,” she said. “I’ve thought of it, you know, what I could do that would pay these loans off and then I can farm and not worry, but I can’t not do this.”

An indebted career

As a whole, student loan debt has grown to become one of the highest debt categories in the United States, according to Forbes, second only to mortgage debt. It’s outpacing credit card and auto loan debt. According to New York Federal Reserve statistics from the fourth quarter of 2016, there are 44 million borrowers in the U.S. owing a total of $1.31 trillion in student loan debt. The rate of student loan delinquency or default is about 11 percent.

While student debt is a growing problem across sectors nationwide, farmers with student debt face even more hurdles when starting their career due to the variable income farming often generates as a profession and because of the additional debt most farmers have to take on to start a farm.

“Farming isn’t a way to make very good money no matter what the circumstances,” Pingree said. “It’s very hard to convince a bank to let you build a barn or do the things that you need to invest in if you’re carrying a lot of other debt because it’s hard to prove that you’re going to be able to pay it back.”

In 2014, the National Young Farmers Coalition conducted a survey of farmers with student loan debt and found that the average debt was about $35,000, with 53 percent of respondents saying they had a hard time paying their student loan payments. Another 30 percent of respondents said they aspired to farm but had to pursue other careers because farming wouldn’t provide an income that could cover their payments.

While the National Coalition for Young Farmers still is compiling data from their 2017 survey of farmers with student loan debt, Bahrenburg said that student debt continues to be among the top three barriers young farmers claim they face when starting their careers.

“We hear it all the time,” Bahrenburg said. “Starting a farm is an incredibly capital intensive pursuit, so the start up costs are high. If you’re struggling to pay your student loan debt every month that’s going to create a significant barrier to starting your business.”

Going into farming with any debt, student loans or otherwise, is a challenge, according to Erica Buswell of the Maine Farmland Trust, because of how much investment needs to be made to get a farm off the ground.

Unless farmers find themselves in a circumstance where they’re gifted land or equipment, farmers are generally starting their agricultural endeavors from scratch, Buswell said. Obtaining mortgages and loans to cover land, equipment and even livestock purchases is common in farming — so, therefore, is debt. And having a good credit score to prove you can pay the debt back is a boon.

If an individual has been making good on their student loan payments, their credit could be positively affected. But if payment delinquency has negatively impacted your credit, or a lender believes you have too much student loan debt to acquire more debt, it could be difficult to get approved for a loan.

“Because of the ways that most financial systems are set up, debt is the only way that you can get started,” Buswell said. “For someone who is carrying maybe any amount of student loan debt, that is going to impact their ability to qualify for other types of credit … lenders may be looking at that as an outstanding liability and thinking no way can we give this person more debt because then they’re going to be completely over leveraged and not be able to make their mortgage payments or their equipment payments or their livestock loan payments.”

But being able to obtain additional loans is only one problem having student debt can pose for farmers. Simply having enough cash to invest in your farm and pay other bills while making regular payments on your student loans is a day to day struggle that young farmers may face.

Alaena Robbins, 27, knows this story well. Graduating from Boston University with a degree in cultural anthropology and about $30,000 in debt, planting roots as a farmer in Maine has been a challenge financially and emotionally because she feels haunted by her student loans.

While Robbins has started a small farm of her own in Limington called Old Wells Farm with three partners, she needs to work full-time on a farm in Scarborough in order to pay her student loans. Between the two farms, Robbins said 60 hour work weeks are the norm.

With her farming partners in similar situations carrying their own student debt, all of them work some type of off-farm job to make ends meet. This time spent away from Old Wells Farm, and lack of excess capital or ability to obtain a loan, has slowed the growth of the farm, Robbins said.

“Pretty successful farmers will say that when they made the leap to just work full-time on their farm and not have any off farm jobs, that’s when the farm really became successful,” Robbins said. “That’s just something that I never feel like I can do because of these debts that I have.”

During her first few years of loan repayment, Robbins was paying back on the traditional 10 year repayment terms, meaning that her student loans cost her about $400 a month. Paired with high rent and other cost of living expenses like health insurance, on a farming apprentice income, making that payment was a huge challenge. Recently, Robbins applied and qualified for income driven repayment, making her monthly payments more manageable. But the new payment plan extends her terms of repayment to 20 years to 25 years, meaning she’s still haunted by the debt, especially working in a career where you don’t necessarily earn more money with time.

“It’s not really a profession that you’ll ever make it up in the ranks and see the benefits of your education necessarily helping you make more money,” she said. “It definitely slows you down and of course it stresses you out a lot. You’re always kind of working week to week figuring out how you’re going to pay for everything.”

Farming as a public service

With the stress and barriers that student debt is causing for young farmers, it’s easy to pose the question, why do it?

For Robinson and Robbins, that’s almost too obvious of a question to answer. Having their hands in the dirt every day growing food for their community is what has come to define their lives.

“I think local food, I think local buying, I think being supported by your neighbors is what keeps you in farming,” she said.

Both admit that they’ve thought about pursuing other careers to be able to have more security in paying back their loans. Throughout her life Robinson has held teaching jobs to try and supplement her income, but she kept being drawn back to the farm.

Robbins knows that she is making a conscious choice to make the income she does as a farmer, but to be able to grow nutritious and sustainable food, it’s a struggle she’s committed to try and live with. Despite her debt, she refuses to turn her back on her pursuits.

“It’s all that you’ve put into it already, the land and the community and the food,” Robbins said. “Everybody needs food, everyone needs to eat. And young farmers, all farmers, are trying to produce healthy fresh food for the people around them.”

The “everyone needs to eat” argument is why Bahrenburg said there should be national concern over rising student debt and how that debt impacts young farmers.

In Maine, farming careers for young people are on the upswing, but that is not the case nationwide. From 2007 to 2012, the numbers of farmers ages 34 and younger grew by 40 percent, according to the U.S. Department of Agriculture’s 2012 census. Nationwide during that time period, the increase was only 1.5 percent.

“As a country we’re speeding towards this cliff where we have a massive generation of farmers getting ready to retire and for now we have far too few farmers ready to take their place,” Bahrenburg said.

To prevent from being in a situation where older farmers are retiring with no one to take their place, Bahrenburg said there needs to be a national plan to encourage and support young people who want to farm. Helping them with any barriers they face, such as student debt, is a crucial part of that plan, he said.

With so much momentum growing around local food and sustainable food systems, paired with the need for more farmers, Buswell and Bahrenburg said now seems like an appropriate time to start thinking about farmers as public servants.

“I think it’s a great idea to think of farmers as public servants for one thing,” Buswell said. “That’s an important cultural shift and helps us all understand and appreciate how we’re connected to our local food systems.”

But even if the Young Farmers Success Act never makes it out of committee, and even if the student debt totals continue to increase, there will still be farmers like Robinson who will commit their lives to feeding their community, despite the financial struggles they may face.

“This is how I help the world,” Robinson said. “As little as it is.”

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