- Provide student loan forgiveness for young people who enter agricultural careers
Two-thirds of college graduates have student loan debt when they graduate. Farming is a vital and in-demand career, and the Federal Government should provide incentives to young people interested in pursuing agriculture, as is the case in other careers that are critical to our nation’s well being. As one option, full-time farm workers, farm owners and farm apprentices could be added to the Public Service Loan Forgiveness Program (PSLF), now offered to physicians, teachers and government employees.
- Prioritize conservation easements that protect farmland affordability within the Agricultural Land Easement (ALE) Program’s National ranking criteria.
The U.S. Department of Agriculture’s Natural Resource Conservation Service will match up to 50 percent of the price of a conservation easement through its Agricultural Land Easement Program (part of the Agricultural Conservation Easement Program [ACEP]). This is an excellent use of federal funds that should continue and be expanded; however, priority should be given to programs or easements that include affordability provisions. If affordability protections are not made in an easement, the land can be sold at a price many times greater than what a farmer can afford and there is no guarantee that it will remain an active farm when the land next changes hands. Land held by a farmer is most likely to be used for production and actively managed to maintain its agricultural viability. Innovative land trusts are making their conservation easements stronger to ensure land stays in production and in the hands of working farmers. Because these easements can be 10-40% more expensive, it is critical that NRCS support them through ACEP funding. Model programs to assure affordability have been successfully implemented by the Vermont Land Trust and by the State of Massachusetts.
- Expand and improve training for new farmers
The Beginning Farmer and Rancher Development Program (BFRDP) was initiated in the 2008 Farm Bill and is one of the most successful programs to date helping young and beginning farmers. BFRDP provides competitive grants to non-profits and universities for beginning farmer-training opportunities. This program provides an important foundation for farmer training and should be renewed and expanded in the next Farm Bill.
- Make FSA loan programs work for young and beginning farmers
FSA loans are critical for many young and beginning farmers. As capital is one of the biggest barriers to starting a farming career, and farm financing has become more difficult in recent years, these programs must be a priority. The direct farm ownership loan experience requirement should be reduced to two years (from three), and USDA should be given the authority to increase the loan limits for direct farm ownership loans in areas of the country with higher real estate prices. The current loan limit is $300,000, which doesn’t go very far in many regions.
Furthermore, young and beginning farmers report that some FSA agents do not know about or promote young and beginning farmer loans, and loan rules are often applied too stringently, preventing young and beginning farmers from receiving credit. FSA should have specially trained agents to assist young and beginning farmers in each county office, or specialists serving multiple offices in a region. In the short term, the USDA should greatly expand their online resources for loan seekers.
Lastly, in competitive real estate markets, the FSA loan making process is likely to take too long for growers to purchase land. The current application process can take longer than 30 days, and funds may not be available for months. FSA should be authorized to pre-approve Direct Farm Ownership loans.
- Fund beginning farmer Individual Development Accounts
Individual development accounts (IDAs) help young and beginning farmers save money by matching funds that they put into a savings account, and help them become successful entrepreneurs by requiring business planning courses. IDA programs have been instrumental in helping young people start businesses in states including Michigan, Iowa and California. The 2008 Farm Bill authorized a matched savings program for beginning farmers, but Congress never funded the program. IDAs should be reauthorized in the 2012 Farm Bill with $5 million of mandatory funding.
- Offer tax credits for selling or leasing land to a beginning farmer
In Nebraska and Iowa, landowners are offered tax incentives for selling or leasing land to a beginning farmer. A similar program should be initiated at the federal level to encourage property owners to sell or lease their land to qualifying beginning farmers. Provisions to ensure that the beginning farmers are making a majority of their income in farming should be put in place.
State Policy Recommendations
- Prioritize conservation easements with affordability language and succession planning in Purchase of Agricultural Conservation Easement (PACE) funding
Protecting a farm from development with an agricultural easement may not ensure that the land will be owned and operated by a farmer or that it will be affordable for a farmer to purchase.37 Massachusetts, through its Agricultural Preservation Restriction program, is committed to keep working lands in active farming by requiring that eased parcels be resold at ‘agricultural value.’ As noted in the federal section, it is important that land protection be coupled with affordability and active farming. Other states should adopt similar regulations in their programs to fund agricultural easements.
- Provide tax incentives for landowners who rent or sell land to beginning farmers
Nebraska and Iowa have adopted innovative programs to provide tax incentives to landowners who lease or sell land to a beginning farmer. Other states should consider similar programs.
- Legalize apprenticeships and protect young farmers
State labor laws govern apprenticeships, and some state laws are friendlier to the idea than others. States should define apprenticeships, legalizing them for farmers while ensuring a safe work environment and fair compensation for farm apprentices.
- Offer competitive grants to beginning farmers
Massachusetts and Texas offer competitive small grants for beginning growers, a new program that helps young people get started in agriculture. This is a great program to watch, and one that should be considered by other states.
- Help make healthcare affordable for farmers
Very few farms offer health insurance for their employees, and many employees will go without because of financial considerations. Programs like Healthy New York and Insure Oklahoma, which enable small business owners to provide affordable health care, should be emulated in other parts of the country to help small farms afford health care for their employees. Farmers who provide health insurance to their workers should not be placed at a competitive disadvantage.
- Provide student loan forgiveness
In Pennsylvania, The Agriculture Education Loan Forgiveness (AELF) program helps eligible graduates repay student loans when they return to Pennsylvania to work in a qualifying agriculture field. Pennsylvania Higher Education Assistance Agency (PHEAA)will forgive up to $2,000 per year on outstanding American Education Services (AES)-administered, federally insured student loans for each year of satisfactory employment.