Bill Text: NJ S1426 | 2018-2019 | Regular Session | Introduced
Bill Title: Requires NJEDA to establish loan program to assist beginning farmers in financing capital purchases.
Spectrum: Slight Partisan Bill (Democrat 2-1)
Status: (Introduced - Dead) 2018-02-01 - Introduced in the Senate, Referred to Senate Economic Growth Committee [S1426 Detail]
Download: New_Jersey-2018-S1426-Introduced.html
Sponsored by:
Senator JEFF VAN DREW
District 1 (Atlantic, Cape May and Cumberland)
SYNOPSIS
Requires NJEDA to establish loan program to assist beginning farmers in financing capital purchases.
CURRENT VERSION OF TEXT
As introduced.
An Act establishing a beginning farmer loan program, and supplementing P.L.1974, c.80 (C.34:1B-1 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. As used in P.L. , c. (C. ) (pending before the Legislature as this bill):
"Agricultural improvement" means any improvement, building, structure, or fixture suitable for use in farming which is located on agricultural land.
"Agricultural land" means land suitable for use in farming.
"Authority" means the New Jersey Economic Development Authority established pursuant to section 4 of P.L.1974, c.80 (C.34:1B-4).
"Beginning farmer" means a person with a low or moderate net worth that engages in farming, or wishes to engage in farming.
"Department" means the Department of Agriculture.
"Depreciable agricultural property" means personal property suitable for use in farming for which an income tax deduction for depreciation is allowable in computing federal income tax under the federal Internal Revenue Code.
"Farming" means the cultivation of land for the production of agricultural crops, the raising of poultry, the production of eggs, the production of milk, the production of fruit or other horticultural crops, grazing, the production of livestock, aquaculture, hydroponics, the production of forest products, or other activities designated by the department pursuant to rules and regulations.
"Low or moderate net worth" means a net worth that does not exceed the maximum allowable net worth established by the department pursuant to rules and regulations. The department shall determine the maximum allowable net worth in using data compiled by the National Agricultural Statistics Service in the United States Department of Agriculture.
2. a. The New Jersey Economic Development Authority, in consultation with the Department of Agriculture, shall develop and administer a beginning farmer loan program to facilitate the acquisition of agricultural land, agricultural improvements, and depreciable agricultural property by beginning farmers.
b. (1) A beginning farmer seeking a loan pursuant to this section shall apply to the authority, in a form and manner as determined by the authority, and shall include such information as the authority determines is necessary in consideration of the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).
(2) In order to receive a loan from the authority pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill), the beginning farmer shall meet the following requirements:
(a) the beginning farmer shall be a resident of the State;
(b) the agricultural land, agricultural improvements, or depreciable agricultural property the beginning farmer proposes to purchase shall be located in the State;
(c) the beginning farmer shall have sufficient education, training, or experience in the type of farming for which the beginning farmer requests the loan;
(d) if the loan is for the acquisition of agricultural land, the beginning farmer shall have access to adequate working capital, farm equipment, machinery, or livestock;
(e) if the loan is for the acquisition of depreciable agricultural property, the beginning farmer shall have access to adequate working capital or agricultural land;
(f) the beginning farmer shall materially and substantially participate in farming;
(g) the agricultural land and agricultural improvements shall only be used for farming by, or under the direction of, the beginning farmer; and
(h) any other criteria established by the authority pursuant to rules and regulations.
(3) The authority shall review completed applications and approve applications that meet the requirements of this section and the rules and regulations adopted pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).
c. A beginning farmer loan under this section shall be made pursuant to a loan agreement with the authority, shall bear interest at rates and terms deemed appropriate by the authority, and shall contain other terms and conditions considered appropriate by the authority that are consistent with the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill) and with the rules and regulations adopted by the authority pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).
d. The authority may, in its discretion, require a beginning farmer that receives a loan pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) to submit an audited financial statement to the authority in order to ensure the beginning farmer's continued viability.
e. The authority may, either through the adoption of rules and regulations, or through the terms of the loan agreement made pursuant to subsection c. of this section, establish terms governing the incidence of default by a beginning farmer that receives a loan under the program administered pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill).
f. The authority may participate in, and cooperate with, programs of the Consolidated Farm Service Agency in the United States Department of Agriculture, Federal Land Bank, or any other agency or instrumentality of the federal government, or with any program of any other State agency in the administration of the beginning farmer loan program.
3. The New Jersey Economic Development Authority, in consultation with the Department of Agriculture, shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), rules and regulations necessary to effectuate the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill).
4. This act shall take effect immediately.
STATEMENT
This bill would require the New Jersey Economic Development Authority ("EDA"), in consultation with the Department of Agriculture, to develop and administer a beginning farmer loan program to facilitate the acquisition of agricultural land, agricultural improvements, or depreciable agricultural property by beginning farmers. Under the bill, a "beginning farmer" is any person with a low or moderate net worth, as determined by the department, that engages in farming, or wishes to engage in farming. An "agricultural improvement" is any improvement, building, structure, or fixture suitable for use in farming which is located on agricultural land. "Depreciable agricultural property" is personal property suitable for use in farming for which an income tax deduction for depreciation is allowable under federal law, such as farm machinery and trucks.
To qualify for a loan under the program, a beginning farmer would have to meet the following requirements: (1) the beginning farmer must be a resident of the State; (2) the agricultural land, agricultural improvements, or depreciable agricultural property the beginning farmer proposes to purchase must be located in the State; (3) the beginning farmer must have sufficient education, training, or experience in the type of farming for which the beginning farmer requests the loan; (4) if the loan is for the acquisition of agricultural land, the beginning farmer must have access to adequate working capital, farm equipment, machinery, or livestock; (5) if the loan is for the acquisition of depreciable agricultural property, the beginning farmer must have access to adequate working capital or agricultural land; (6) the beginning farmer must materially and substantially participate in farming; (7) the agricultural land and agricultural improvements must only be used for farming by, or under the direction of, the beginning farmer; and (8) any other criteria established by the authority pursuant to regulation.
The bill requires that an EDA-approved loan to a beginning farmer is to be made pursuant to a loan agreement with the authority, bear interest at rates and terms deemed appropriate by the EDA, ad contain other terms and conditions considered appropriate by the EDA that are consistent with the purposes of the bill and the regulations adopted by the EDA. The authority could require a beginning farmer that receives a loan under the program to submit an audited financial statement to the authority in order to ensure the beginning farmer's continued viability, and may, either by regulation or through the terms of the loan agreement, establish terms governing the incidence of default by a beginning farmer that receives a loan under the program. The EDA would have the authority to participate in programs of the United States Department of Agriculture Consolidated Farm Service Agency, Federal Land Bank, or any other federal or State agency in the administration of this program.
