Bustos, Bost propose Farm Bureau-initiated loan program

Loans would offer rates that better reflect the market, incentivize conservation practices and provide young farmers with credit access.

Bustos _bost _propose _farm _bureau _initiated _loan _program _1_636540353135131895

A proposed loan program would add incentives for planting cover crops and require the use of reduced-tillage and nutrient-management practices. (Illinois Farm Bureau file photo)

By Deana Stroisch

Corn, soybean and wheat farmers could qualify for a new conservation-oriented loan program under bipartisan legislation introduced last week by U.S. Reps. Cheri Bustos and Mike Bost.

The Conservation Assistance Loan Act of 2018, HR 4988, would establish a loan program which offers rates that better reflect current market conditions. The program would also serve as an incentive for conservation practices and provide young farmers with access to credit.

“Most farmers I talk to want to use cover crops and take other steps to be more sustainable and improve soil health, but face challenges that can make it tough to get started,” said Bustos, D-East Moline. “The Conservation Assistance Loan Act would help them overcome these challenges and improve both their operation and land.”

The idea for the loan program originated from farmers attending Illinois Farm Bureau farm bill work sessions last year. It was created with the help of University of Illinois’ Jonathan Coppess, Gardner Ag Policy Program director.

“It was the product of interest in better conservation policy that takes into account the risks farmers have to manage – especially price – and the efforts under way to reduce nutrient losses through the Illinois Nutrient Loss Reduction Strategy,” Coppess said. “As we talked through it, the combined issues presented an opportunity to suggest revisions to the marketing loan policy program.”

Related: State FSA director encourages farmers to sign up early for programs. Read more here.

Coppess noted the loan program has been around since the 1930s and last changed in the late 1980s and early 1990s.

Under the proposed legislation:

- Farmers would qualify for loans at 60 percent of the five-year Olympic average of the commodity’s marketing year average prices.

- Farmers agree to comply with applicable conservation and wetland protection requirements.

- Farmers must use a reduced-tillage method and nutrient-management practices associated with the commodity covered by the loan.

- Farmers borrowing money to plant cover crops would receive an additional 20 cents per bushel.

- Young and beginning farmers would qualify for loans at 75 percent of the five-year Olympic average.

Delegates at Illinois Farm Bureau’s Annual Meeting in December voted to support the program, adding language to its policy book. American Farm Bureau Federation delegates adopted IFB’s policy language in January.

“The goal is to get the bill enacted in the next farm bill,” said IFB President Richard Guebert Jr. “Farm Bureau members are grateful for the bipartisan leadership of Reps. Bustos and Bost and for recognizing that farmers need new tools to address the challenge of reducing nutrient losses from our fields.”

Bost, R-Murphysboro, said: “I’m happy to join this bipartisan effort to ensure our farmers have every tool available to improve soil health and reduce nutrient runoff. Cover crops, along with cutting edge technology, benefit the environment, the bottom line of the farmer, and allow for this generation of agriculture producers to pass along the land in better condition than when they received it.”

Content for this story was provided by FarmWeekNow.com.

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