U.S Senator reintroduces Capital for Farmers and Ranchers Act
The bill would increase the loan amounts farmers could receive
By Diego Flammini
Assistant Editor, North American Content
A Senator from North Dakota wants farmers to have access to higher loan amounts to reflect the industry’s volatility.
John Hoeven, who is also the chairman of the Senate Agriculture Appropriations Committee, reintroduced the Capital for Farmers and Ranchers Act on August 4. He originally introduced the bill on July 14, 2016 but it was not enacted.
On July 28, 2017, Hoeven announced his intentions to reintroduce the bill at a hearing of the Senate Agriculture, Nutrition and Forestry Committee.
The bill calls for the Farm Service Agency’s (FSA) loan guarantee to increase from $1.39 million to $2.5 million and to double the amount of direct loans from $300,000 to $600,000.
The bill is cosponsored by Senators John Boozman (Arkansas) and Luther Strange (Alabama).
The increases would cover two types of loans and guarantees.
Farm operating loans would cover a variety of expenses, including purchasing livestock, feed, equipment, fuel, minor building repairs and costs associated with land development.
And the increases would also cover farm ownership loans to purchase land, erect buildings, and promote soil and water conservation.
More than ever, farmers need to have the financial flexibility to manage agriculture’s unpredictable nature, says the legislation’s supporters.
“This will not only help ensure they can continue producing the highest quality, lowest cost food in the world, but also provide greater stability to rural economies across the country,” Hoeven said in an August 4 statement. “Our farmers and ranchers need access to credit, especially during challenging times like these.”
Farm groups support FSA lending increase
Many of America’s farm organizations also feel producers need access to more capital to ensure their operation is successful.
“The loan limits are just not up to par for what farmers need today to get started,” Mark Hayes, director of media relations for the Farm Credit Council, told Farms.com. “If someone is going to get started in farming they need to be able to get to the point of being commercially viable.
Earlier in the year, the Farm Credit Council and other ag organizations wrote to the Senate and House committees on appropriations to advocate for higher FSA loan limits.
“…low commodity prices have reduced net farm income by over 50 percent in the past four years and FSA loans serve as an important lifeline for many distressed producers,” reads the letter co-signed by a number of farm groups, including the National Corn Growers Association, American Soybean Association and National Milk Producers Federation.
The letter is dated June 14, almost a month before Senator Hoeven planned to reintroduce his bill.