A program to help a person interested in farming, but short on cash, get started has been enhanced and Missouri officials hope it gets renewed life here. The federal Farm Bill established the Beginning Farmer Loan Program in the mid-80s, lending up to a quarter million dollars at subsidized rates. But a quarter million doesn’t buy what it used to.
"Especially on some of the more concentrated operations, like dairy where you have a lot more in facilities or even some of the swine operations," says Tony Stafford, director, Ag Business Development Division within the State Department of Agriculture, "A building itself could eat up that much, almost, let alone any of the real estate."
The farm bill raises the maximum loan from $250,000 to $450,000. It works by providing tax exempt bonds to banks that participate, thus allowing the banks to shave up to two percent off the interest rate, quite a sum on a $450,000 loan.
"That can very well be the difference between a positive or a negative cash flow in a lot of years," says Stafford.
Stafford says too many young people are leaving the farm. He hopes the enhancement of the program will lure more Missourians to return to farming. About 260 Missourians have received loans under the program, borrowing more than $31.4 million over the years.