For over two decades, Bruce Everly has been helping Indiana farmers apply for funding from the federal Rural Energy for America Program, which provides grants for solar, wind, energy-efficiency upgrades, grain dryers, biodigesters, and other projects in rural America.
He’s seen it serve as an economic lifeline for small farmers, especially the state’s poultry producers who operate on thin profit margins.
But the program, known as REAP, has faced a series of setbacks under the Trump administration. Nearly $1 billion in funding was frozen for months, farmers have heard nothing about applications filed last fall — and now a window for new applications that was supposed to open July 1 was closed at the last minute.
Meanwhile, the most common use case for REAP grants, helping farmers install solar, is under direct threat from the administration. A recent U.S. Department of Agriculture document outlining its Make Agriculture Great Again agenda says that, going forward, REAP “will disincentivize funding for solar panels on productive farmland.”
The 2022 Inflation Reduction Act infused REAP with over $2 billion, but those funds will soon run out, meaning the program will likely revert to the lower funding level of $50 million per year ensured by the current iteration of the federal Farm Bill.
“We’re not looking at an IRA-like opportunity for REAP again any time soon,” said Lloyd Ritter, founder of the clean-energy policy consultancy Green Capitol. He helped draft the original REAP program as senior counsel for former Sen. Tom Harkin (D-Iowa).
A slowdown in REAP funding would be a blow to the thousands of American farmers who use the program nationwide, forcing them to spend more money to meet their energy needs. And the efforts to block REAP funds from solar projects in particular would both stymie the growth of clean energy in rural areas and hamper what’s become a key source of income for farmers.
“This program has been key to helping people who don’t have a lot of assets make a change and provide some cash flow for their family,” said Everly, who has assisted with REAP grants to turn manure into biofuel, grow vegetables year-round in indoor enclosures, and add “desperately needed” energy efficiency to poultry barns.
A boon and bust
The 2002 Farm Bill created the program now known as REAP; it was given its current name under the 2008 Farm Bill.
For more than two decades, the program has offered loan guarantees and grants to farmers and rural small businesses, as well as doled out grants to organizations that provide applicants with technical assistance.
Under the Farm Bill, REAP grants reimbursed recipients for up to a quarter of a project’s cost. The IRA increased reimbursement to up to 50 percent of a project’s cost.
USDA data shows that more than $1 billion in IRA REAP funding was awarded in over 6,800 grants to farmers and rural small businesses between fiscal year 2023 and the first quarter of fiscal year 2025, according to an analysis by the Environmental Law & Policy Center, with 80 percent of the grants going to Republican House districts.
Congress allocated IRA funds for REAP applications through 2031, though the funding will likely run out long before then. Federal data shows that about half of IRA REAP funds have already been obligated.
President Donald Trump froze over $911 million in REAP funds with his Day 1 executive order targeting IRA programs. His administration lifted the freeze in late March and has yet to make another attempt at clawing back already-promised IRA REAP funds, as some advocates had feared would happen — especially for solar projects.
Nonetheless, farmers and experts who monitor the program wonder whether expected grant payments will be disbursed or new applications accepted in coming months, and whether farmers will still trust the program after this period of chaos.
REAP grants are administered through reimbursement, meaning uncertainty is particularly harmful. Farmers and other recipients make significant up-front investments with their own money under the assumption that the government will honor its commitment to pay them back.
“This year, since Jan. 20, has been incredible levels of stress for people who did not understand if they would ever get paid for work where they have already put down millions of dollars on projects,” said Everly.
“No matter what the government does, the harvest happens at the same time every year. Farmers had made investments with hope of help from the government, and there’s great uncertainty right now.”
A window closed
On June 30, the USDA released a statement saying that the fiscal year 2026 REAP application period that was supposed to run from July 1 to Sept. 30 would not happen.
“This decision was made due to the overwhelming response and continued popularity of the program resulting in a backlog of applicants,” the brief statement says. The USDA said it “anticipates” accepting applications again starting Oct. 1.
Meanwhile, the agency has yet to announce decisions on applications submitted last fall, farmers and the advocates who help them with REAP applications told Canary Media. Usually, farmers and technical assistance organizations feel fairly confident that a strong proposal will receive an award, and many made plans expecting to receive funding, Everly said. Now, they are unsure.
REAP only reimburses projects that were started after the application was submitted, so many farmers planning to apply this round had postponed breaking ground on projects until after July 1, Everly said. But with the sudden delay, they must now choose to either move forward without REAP funding or kick needed upgrades down the road once more.
The number of REAP award decisions is indeed down significantly this year, according to an analysis by the Environmental Law & Policy Center. Federal data obtained by the group through a public records request shows the USDA obligated money for just over 1,900 grant and loan guarantees between the start of this fiscal year and July 9; almost 2,400 obligations were made during the same period last year. While the money awarded for grants so far this year is only slightly less than last year, the dollars for loan guarantees are drastically lower.
Everly was hired by the Indiana state government to help farmers file REAP applications in the program’s early days, then founded a firm now staffed by his wife and more than a dozen employees.
His company, EIM LLC, had seven people working full time on REAP applications over the past three months in anticipation of the July 1 application window. They only get paid once projects come to fruition. REAP data from the USDA shows that the company was awarded five grants for $100,000 each in fiscal year 2023, but has received only about $25,000 thus far.
Everly said his firm has a 92 percent success rate in applications, so the wait for payment is not usually a problem. But now he’s uncertain if the 3,000 hours of staff time spent on this latest round of applications will ever be compensated.
“We don’t know if we’ll ever get paid for any of the work we did,” said Everly, whose family also owns two farms in the state, one going back seven generations. He said his firm can survive the possible financial setback, but many farmers are working on tighter margins. “We’ve helped a lot of people who really need the help” from REAP funds.
A rollercoaster
The canceled July application window was just the latest disruption in what’s been a chaotic year for REAP.
On March 26, USDA sent a cryptic letter to REAP and other rural agriculture grant recipients noting that the funding freeze was over, and they had 30 days to “voluntarily” alter their applications to remove “any harmful [Diversity, Equity, Inclusion, and Accessibility] project features” or to use “more affordable and effective energy sources.” The letter indicated grants would be paid even without changes.
Amanda Pankau, director of energy and community resiliency at the environmental nonprofit Prairie Rivers Network, said REAP recipients her organization works with in Illinois were alarmed by the freeze and then confused by the letter, especially since switching to an energy source other than solar wasn’t an option, and most projects did not have DEIA components. Indeed, federal data shows that over the past decade, 82 percent of REAP grants went to recipients identified as white, and 75 percent went to men or businesses owned by men.
“The federal freeze and policy chaos, including the confusion surrounding the March 26 letter, created real distress for Illinois’ farmers and rural small businesses,” Pankau said. “We know that rural farmers and small business owners are already managing intense stress and thin profit margins. Many don’t have the privilege of a financial cushion to absorb months of federal uncertainty for clean energy projects that were already awarded or underway.”
In mid-April, a federal judge ruled that the USDA must pay out billions of dollars promised under the IRA, including from REAP and other clean energy programs such as Empowering Rural America, Powering Affordable Clean Energy, and Partnership for Climate-Smart Commodities.
The following week, on April 25, three congressional Democrats from Minnesota — Sens. Amy Klobuchar and Tina Smith, along with Rep. Angie Craig — sent a letter to the USDA demanding answers about REAP funds that appeared to still be frozen.
The tumult has had lasting impacts on farmers, technical assistance organizations, and solar developers, multiple sources told Canary Media.
“People are being whipsawed out there, who are just trying to use the program to install clean energy and cut energy waste,” said Andy Olsen, senior policy advocate for the Environmental Law & Policy Center.
Tim Biello is the owner and manager of Featherbed Lane Farm, a regenerative farm supplying community-supported agriculture in upstate New York. He learned in January that he had received REAP funding for a 30-kilowatt, $115,000 solar project. After the freeze, he wondered whether he should really start the project, since he can’t afford it without REAP reimbursement.
Courtesy of Featherbed Lane Farm
“I got awarded, which was awesome news,” said Biello in May. “Then we got the notice it was frozen. The solar company was just about to put a $50,000 to $75,000 order for panels. We canceled that; the advice was not to proceed unless you can take it on with no reimbursement.”
Biello said at the time that he assumed he would get the promised payment, “but I don’t feel like anything now is guaranteed, even if you have a signed contract with the government.”
Ultimately, Biello decided to install the solar project this summer, after learning the funds were unfrozen and consulting with advisers. In early July, he could finally take a breath of relief: The USDA officially reimbursed him.
Farmers in Iowa have similar trepidation, according to Mike Brummer, sales manager at Eagle Point Solar, an installer that counts REAP grantees among its customers.
“We’re at this point trying to treat it as business as usual. Let’s keep talking about the project, moving forward with the necessary items,” Brummer said. “I joke I’ll check my Twitter account at 2 a.m. for an update.”
He said many farmers can only do solar projects with the help of REAP.
“The REAP grant can make or break a project, especially for a small farmer or small business,” he said. “For farmers, every penny has a name on it before it hits the bank. The more pennies you can save, the more chance you have of enduring as a farm and being able to go to the next generation.”
The future
Everly has three wishes for REAP going forward: clarity on the status of application windows and the program’s future; full funding through the Farm Bill, so that 50 percent reimbursement can continue; and staff support from the USDA.
“Is it 25 percent or 50 percent [reimbursement], and are the application deadlines real or imaginary?” he said.
With sweeping cuts to the federal workforce, it can be hard to reach someone in the USDA with questions or concerns about the program or an application, he added.
Given the turmoil of the past six months, Everly and others are worried that farmers won’t trust REAP as a resource even if the USDA takes applications again. Everly noted that the average farmer only has about 40 harvest seasons in their life, and with so many resources sunk into each season, they can’t afford to take many risks.
“Any time you create uncertainty,” farmers will be dissuaded, he said. “They only get to run this experiment 40 times in their life. If you messed up two of them, it’s hard to get their faith back. One mistake and you’ve lost multiple generations of wealth.”
Ritter at Green Capitol shares Everly’s concern about federal layoffs impacting REAP. In May, Agriculture Secretary Brooke Rollins told lawmakers that the USDA was trying to fill critical positions after more than 15,000 agency employees took buyouts aimed at reducing the federal workforce.
“My biggest fear is the staffing cuts at USDA will hurt program implementation and efficiency and speed,” Ritter said.
He emphasized the bipartisan support that REAP has long enjoyed, and said he hopes and expects that popularity will help the program weather tough times.
“REAP just makes sense,” said Ritter. “The vast bulk of applicants are farmers, ranchers, [and] rural small businesses using it to help lower energy costs and build energy dominance in rural America. Despite unfair and unreasonable attacks from the far right, I think REAP will be OK.”
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Kari Lydersen grist.org
