Lenny Xiong

Since quitting his job at a smoke detector plant, Lenny Xiong has risen to the pinnacle of small-time farming success – a 12-acre farm, an arsenal of tractor add-ons, a deal with a pickle company for 100,000 pounds of cucumbers – very cautiously.

He turned down a membership with the Hmong American Farmers Association in 2007.

“I wasn’t sure yet,” he says. “Then they asked me again, so I said OK.”

He joined HAFA’s business development program, reluctantly. And when a staff member advised him to take out a loan, he demurred.

“It was scary for me,” he says. “I didn’t know if I would make enough money to pay it back.”

Lenny’s concerns are familiar to Tara Yang, business development organizer at HAFA.

“In our culture, what we do is we sit back and watch someone else do it first, and if they’re successful, we’ll do it too,” she explains.

Today many Hmong farmers are watching Lenny to see what a fellow immigrant, with limited English skills, can make of himself.

Meanwhile Lenny is at the EFC, extolling risk.

“It’s business, so you have to take a chance,” he says, “win or lose. Because you never know, maybe it’s good.”

Hmong farmers in Minnesota have faced language barriers, racism and short funds. But they have also been crippled, Tara says, by their own fears of the market. She says many of them, like Lenny, are wary of loans.

For the past four years, HAFA members have come to the EFC to get comfortable with their finances. Many of them are part of the EFC’s Customized Matched Savings program. Counselors at the EFC open savings accounts for them, supplement their savings with up to $2,000 in grants, and guide their spending.

Other organizations, including LSS LifeHaven and Cedar Riverside Neighborhood Revitalization Program, have similar arrangements with the EFC. But HAFA members have been uniquely successful. Their net worth has increased by $150,000, Tara says.

Tara says the Matched Savings Program is just one piece of a system at HAFA that helps farmers expand their businesses. Participants take business training courses, apply for grants and bid for contracts with retailers and schools, as well as saving money. An ideal trajectory goes something like this: farmers save enough to buy new equipment. That equipment helps them farm more efficiently, win more contracts and make more money, which they can reinvest in their farms.

Success stories like Lenny’s have drawn more HAFA members to the program every year. Since 2014, they have increased from six participants to eleven. That’s a lot, Tara says, considering that many of them are uneasy.

Lenny started farming in 2006, “for fun,” he says. But he wanted to become a full-time farmer, and HAFA staff encouraged him to try.

“I like farming,” Lenny says. “Outside. On your own time. You don’t have to have somebody yelling at you or anything like that.”

At first, Lenny rented a few acres. He and his wife farmed as a team, on hands and knees.

“I would poke on the line, dig the hole,” he explains. “My wife would follow me and put the plant there and squeeze the ground, and we’d keep going down the line.”

It took them a month to plant two acres of vegetables.

“It was very slow,” Lenny says. “It was very hard, and it was very painful.”

Lenny joined the Matched Savings Program in 2014 and saved enough to buy a $3,000 planter machine. Now he can hitch the implement to his tractor and plant two acres of vegetables – tomatoes, bell peppers and cucumbers – in one day.

Purchases like this have catalyzed a chain of advancements for Lenny. With more income, he was able to secure a 10-year lease on his land, and win a lucrative pickle contract.

Loans have helped him stretch his savings as far as possible. Last year, for instance, he saved $4,000 through the Matched Savings Program, and used it to leverage a $5,000 loan. He bought a $9,000 Ford f450 pickup truck.

Tara says she encourages all HAFA members to use that strategy. Farmers are eligible for very low-interest loans. The Farm Service Agency and Minnesota Department of Agriculture, for instance, offer loans with interest rates as low as 2 percent.

“If they use this money to leverage a loan,” Tara says, “soon their credit is good and they’re in good standing with those organizations, and they can get even larger loans.”

Tara says HAFA members have used their savings accounts, paired with loans, to buy tractors, implements and refrigerated trucks. Many of them hope to buy land and fund secondary businesses to employ their children, who are generally averse to farming.

Lenny says HAFA has shown him a vision of the future that is appealing. But the tools that are necessary to reach it – namely, loans – are sometimes scary.

“We farm, so we never know,” he says. “If it’s bad weather, you kill your plants. Thunder storms, hail, whatever.”

Tara says the Customized Matched Savings Program has done a good job of accommodating farmers’ concerns. Compared to traditional savings programs, such as the government-funded IDA program, it is flexible.

“It doesn’t push them to grow too fast,” she says.

While other programs specify how participants can spend their savings, usually on expensive assets like cars or higher education, the EFC’s program does not.

“It’s been good,” Lenny says of his business growth. “This year maybe I’ll try a loan again.”