Down payment assistance program will provide much needed boost to Minnesota’s emerging farmers
The Minnesota Legislature this year approved $500,000 for down payment assistance for emerging farmers to get on land of their own.
ST. PAUL — In an attempt to make it easier for people interested in farming to acquire land, a new state program will help Minnesota farmers get down payment assistance.
State Rep. Samantha Vang, vice chairwoman of the House Agriculture Finance and Policy Committee, crafted the bill for the program aimed at helping small-scale farmers and farmers of color in Minnesota get on farmland of their own.
The policy was first in a bill sponsored in the Democratic-led House by Vang and in the Republican-majority Senate by Sen. Gene Dornink.
The program provides grants up to $15,000 per eligible farmer through the Minnesota Department of Agriculture. Eligible farmers need to be Minnesota residents purchasing a farm, and they would need to provide a non-state funding match.
“Let's say if you give $10,000, the state can match you $10,000, to help you buy a couple acres of land,” said Vang.
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There are some contingencies, such as the farmer would be required to own and farm the land for at least five years or pay a penalty equal to 20% of the grant per year.
“Farming is a capital-intensive venture, especially what’s happening today with the prices of fertilizer and fuel and such,” said Rep. Paul Anderson.
Vang said she wrote the program’s proposal after hearing from farmers across the state that accessing land is a critical barrier to starting or expanding operations. She said the bill will hopefully help build the next generation of farmers in the state.
“Trailways into expanding a farming business is difficult if you don't have the financial capital, and you don't have access to land,” said Vang.
She said she modeled the bill after similar proposals for helping first-time homebuyers.
“Down payment assistance is one of the direct ways that we can support folks into ownership,” she said. “For this, instead of homebuying, it's buying farmland.”
Helping farmers of color
The program is not only aimed at small-scale producers, but producers of color, said Vang.
“Farmers are at least 99% white,” said Vang. “And historically, farmers of color have been disenfranchised and have not had equal access to federal support, or government support and subsidies.”
She said farmers of color — many of whom have been farming for generations — also have a history of having land taken away from them.
“We know that farmers are crucial to our basic need in food, and we have a diversifying state, so the more that we're able to support more farmers — especially farmers of color — benefits all of us,” said Vang.
Uncertainty of renting
The program is also aimed at helping farmers who are currently renting land to get out of the uncertainty that comes with having a landlord control the future of their operation.
“A lease can end, and that could decide how a farmer is able to grow their operation,” said Vang.
She said if farmers want to grow crops that require land to be cultivated for many years, renting can be a barrier to doing that.
“Access to land can affect what they grow, how long they can grow for, and what kind of markets they can reach,” said Vang. “In order for these farmers to build sustainable livelihoods, they’ve got to be able to have access to long-term certainty, which starts with owning land.”
For the program, eligible farmers are required to provide the majority of the day-to-day physical labor and management of the farm, and farmers cannot earn more than $250,000 a year in gross sales of farm products.
Vang said because the amount of money eligible through the program is only up to $15,000, large producers won’t be applying for it.
“It will make a big difference to small farmers who struggle in getting access to that little financial push to help them buy those first couple acres of land,” said Vang.
The proposal was initially for $3 million, but it was slimmed down by the Legislature this year to $500,000 in the current two-year budget. The program will include $1.5 million each biennium after that.
“The key part is that continual investment — it’s not just one-time money,” said Vang. “Farmers can know that there's money there in the long term, so whenever farmers are ready to expand their business and jump-start into the industry, they have this resource that they can rely on.”