Lending for Justice

For a man who never intended to leave Laos, Joua-Pao Yang looks content on his farm in Woodinville, Washington. At first he seems to fit the stereotype of the hard-working immigrant. He runs a farm and moonlights as a janitor because he wants to put his kids through college.

But Yang and the four Laotian families with whom he farms didn’t come here to pursue the American Dream. They wound up north of Seattle as political refugees. The Hmong and the Mien tribes of Laos and Cambodia helped the losing side during the Vietnam War. When the United States pulled out, the Viet Cong sent these soldiers to re-education camps where many died of starvation.

Fortunately, Joua-Pao Yang was a college student and then a school teacher during the war, so he avoided military service. This background served him well when his family and many other Hmong fled to Thailand. In the refugee camps, Yang taught the school children. His university degree and ability to speak six languages would seem to make him welcome in any country. But, he explained, "Thailand was too crowded. They have 40 million people. They don’t accept refugees."

In 1980, his family found permanent refuge in Seattle. Within months, he started a farm with four other Hmong and Mien families. Leasing land from the county, they grow Asian vegetables for restaurants, supermarkets, and Asian specialty stores. Each farm is a for-profit venture run by a separate family, yet they share all the work. This isn’t factory farming; they plow with tractors, but they plant and harvest mostly by hand.

In 1983, the four families formed a non-profit cooperative, the Indo-Chinese Farmers Association, for marketing purposes. Together they run a retail stall at Seattle’s Pike Place Market and wholesale to their institutional customers.

Most American farmers hire outside firms to help with tax and regulatory compliance. For the Indo-Chinese Farmers, these tasks were complicated by their dual profit/non-profit status. With the added strain of language and cultural barriers, the farmers needed outside business consultation, but couldn’t afford it. For years they appealed without success to grant-giving agencies for aid. These factors, along with the devastating rains of 1993, left their co-op almost bankrupt by last year.

Help finally came when Seattle’s Cascadia Revolving Fund intervened. Cascadia is a Community Development Loan Fund (CDLF), a non-profit lending institution. Their mission is to make small loans at below-market rates to economically disadvantaged people. Many CDLFs loan only to affordable-housing projects. (Housing can always be repossessed.) But the Cascadia Revolving Fund prefers the riskier work of small business/cooperative lending in Seattle’s inner city and in Puget Sound’s distressed rural areas.

Patty Grossman, executive director of the Cascadia Revolving Fund, explained her goal for the farmers: "To make them a stand-alone non-profit, not beholden to grant-making organizations." First meeting Joua-Pao Yang in a business skills class for minority entrepreneurs, Grossman was impressed with how quickly the refugees learned. Cascadia lent the farmers $2,500 to fix their tractors and buy seed and fertilizer. "All their expenses come at the beginning of the growing season, and they pay everybody back at the end," Grossman said. She knows rural economics from working with César Chávez in the 1980s.

But a small cash infusion wouldn’t solve everything. Cascadia’s assistant director, Terri Shapiro, educated the co-op officers further. From her the farmers learned about balance sheets, income statements, cash management, cash-flow projections, and how to calculate depreciation. The fund works so closely with its clients because "we don’t want them to fail," said Grossman. Cascadia will lend the Indo-Chinese Farmers $24,000 next year, and, she added, "They’re only a year away from being able to stand alone."

When asked why she personally wanted to help this group, Grossman said, "We have a moral obligation to support them because of what the [Vietnam] War did to them. We used their help." Grossman explained the larger social benefits, too. "It’s worth our money to support refugee businesses, at least for three to five years, because they encounter so many obstacles. The payback is that they stay in business and become good taxpayers if given the chance."

With the new loan, Yang said the farmers might buy more land. More land means more work, but as Joua-Pao Yang confided, "I want to pay off the mortgage on my house."

There are 42 community development loan funds in the United States. To find out about the ones in your region, contact: National Association of Community Development Loan Funds, 924 Cherry St., 3rd floor, Philadelphia, PA 19107-5085; (215) 923-4754.