NSAC's Blog
Path to the 2018 Farm Bill: Beginning and Socially Disadvantaged Farmers
November 14, 2017
Workers harvesting sweet potatoes on Scott Family Farms International in Lucama, N.C. Photo credit: USDA, Preston Keres.
Editor’s Note: On October 24, the National Sustainable Agriculture Coalition (NSAC) released its 2018 Farm Bill policy platform, An Agenda for the 2018 Farm Bill, which provides a comprehensive vision for a more sustainable farm and food system based on the recommendations and experience of American family farmers and the organizations that represent them. This is the second post in a multipart series that breaks down NSAC’s policy platform for the 2018 Farm Bill.
It makes sense that agriculture has historically been an intergenerational industry – farming isn’t about short-term gains; farmers know that in order to be successful, they have to plan months, years, and even decades into the future. Passing on a farm operation from parent to child, therefore, makes sense because each generation can build upon the skills and successes of the one before it.
Today, however, keeping the farm in the family is no longer a sure thing. In the coming years, American farmers – the average age of which has risen to nearly 60 – will be retiring in increasingly higher numbers. Of even more concern, is the fact that few of these aging producers have succession plans in place to ensure the longevity of their operations and continued stewardship of the land for generations to come.
The good news is that interest in starting careers in agriculture is on the rise, including from those who don’t come from a farm family. In order to usher in our next generation of farmers and ranchers, however, we have to break down the barriers that prevent them from entering and succeeding in the industry. Aspiring farmers, particularly those considered young and/or socially disadvantaged, struggle with some very real challenges, including: the limited availability of affordable and desirable farmland, difficulty acquiring start-up capital and financing, and inadequate access to hands-on training and risk management tools.
One of the many roles of the farm bill is to ensure a vibrant and sustainable future for American agriculture by facilitating the transfer of skills, knowledge, and land between current and future generations of family farmers. Over the last few farm bills – thanks in no small part to the advocacy of groups like NSAC and our members – the U.S. Department of Agriculture (USDA) has made some significant progress in opening doors to aspiring farmers and ranchers. However, given the industry’s growing need for skilled producers, it is clear that a greater investment and a more coordinated national strategy are needed.
NSAC’s Farm Bill Platform lays out an ambitious agenda for how Congress and USDA can address the critical issues beginning and socially disadvantaged farmers by:
- Expanding access to credit, crop insurance, and affordable farmland
- Increasing technical assistance and outreach services to underserved communities
- Empowering farmers and ranchers with the skills to succeed in today’s agricultural economy
- Encouraging a heightened commitment to advanced conservation and stewardship
Expanding Access to Credit, Crop Insurance, and Affordable Farmland
Nearly 100 million acres of farmland (enough to support ~250,000 family farms) is set to change hands over the next five years – during the course of our next farm bill. Of this farmland, just 23 percent is expected to be sold to a non-relative. If we do nothing, new, non-heir farmers will be left with extremely narrow prospects for acquiring the land needed to start their farm businesses. Because farmland is scarce, prices for what little farmland is available to aspiring farmers is becoming increasingly unaffordable, Over the past 15 years, farmland inflation rates have increased by nearly 150 percent; in some states that are facing high development pressure or investor interest this has caused land prices to reach well over $10,000 per acre (USDA-NASS, 2016).
To improve access to affordable farmland for the next generation of farmers, the 2018 Farm Bill will need to help connect retiring farmers interested in passing on their farm businesses with aspiring farmers looking to enter the field. Policies that would help to facilitate this exchange in ways that benefit both generations of producers include:
- Increasing the flexibility and effectiveness of land-link programs like the Transition Incentives Program by removing the current funding limitation and expanding eligibility to all Conservation Reserve Program contract holders
- Launching a new farmland data initiative to support on-going data collection and analysis of national trends on farmland ownership, tenure, transition, barriers to entry, profitability and viability of beginning farmers
- Protecting farmland affordability for conservation easements purchased under the Agriculture Conservation Easement Program
In addition to land, access to credit is particularly critical for those just beginning their career in agriculture. Rarely do young, aspiring, and beginning farmers have the cash to outright to purchase the equipment, land, and other inputs needed to launch their businesses. By expanding access to credit options, beginning farmers are able to purchase the supplies they need in order to plant (and then harvest) the fruits of their labor.
Effective risk management strategies are also especially important during a farmer’s first few years – a time during which they may have few assets or savings to fall back on in case of a crop failure or lower-than-anticipated revenues.
The federal crop insurance program plays an important role in shielding farmers against unforeseen disasters and downfalls, but currently the program does not serve all producers equally or adequately. Federal risk management programs must be modernized so that they adequately meet the needs of historically underserved farmer populations, including: beginning, socially disadvantaged, organic, and diversified farmers, as well as operators of small and mid-sized farms.
The 2018 Farm Bill must increase equitable access to financial capital and risk management options for beginning and underserved producers by:
- Ensuring that farmers are able to finance new farm purchases by raising the cap on FSA Direct Ownership Loans to $500,000, adjusted annually by regional farmland inflation rates
- Preserving the current loan limit on FSA Direct Operating Loans to ensure funding remains available to beginning and socially disadvantaged farmers to cover annual operating expenses
- Expanding beginning farmer crop insurance incentives to all new farmers with under 10 years of production history
- Creating an on-ramp to Federal Crop Insurance for beginning farmers with no revenue history through the Non-insured Crop Assistance Program
Increasing Technical Assistance and Outreach Services to Underserved Communities
Farming is a risky business in general, but farmers of color often face even greater challenges in launching and sustaining their operations. Although federal resources are an important part of the farm safety net, farmers of color have not historically participated in, or benefitted from USDA programs to the same extent as other farmers. This disparity in participation not only disadvantages these individual farmers, it also stifles the growth and prosperity of entire rural communities.
Over the past 20 years, federal initiatives like the Outreach and Assistance for Socially Disadvantaged and Veteran Farmers and Ranchers program (the 2501 program) have invested millions of dollars to develop and strengthen innovative outreach and technical assistance programs targeted at historically underserved producers. Recognizing that returning military veterans face their own unique challenges when trying to start successful farming businesses, the 2014 Farm Bill expanded the scope of the program to also include military veterans. In the same bill, however, program funding for the 2501 program was also inexplicably cut in half.
Underinvestment in the 2501 program has shortchanged our nation’s most vulnerable and chronically underserved farmers and ranchers and has slowed the progress of the American agricultural economy. Given the need for the critical services the 2501 program provides and the expanded scope authorized by the 2014 Farm Bill, it is essential that Congress scale up – not cut back – support for our nation’s most underserved communities. We can accomplish this in the 2018 Farm Bill by:
- Reauthorizing and providing permanent mandatory funding for the 2501 program
- Increasing program transparency, accountability, and efficiency by requiring an external peer review and public reporting on project outcomes
Empowering New Farmers with the Skills to Succeed in Today’s Agricultural Economy
Our nation’s farming population has dwindled from nearly half of the U.S. workforce at the turn of the century, to only two percent of our workforce as of the last Census of Agriculture. This means that fewer people are growing up on farms, and that many aspiring farmers today are first generation farmers who have not had the opportunity to acquire the skills to run a successful operation through hands-on experience or mentorship.
In order to give the next generation of farmers and ranchers the skills they need to succeed in agriculture, the 2018 Farm Bill must support innovative initiatives that help meet the needs of today’s modern producers, and also expand support for existing, successful programs, such as the Beginning Farmer and Rancher Development Program (BFRDP). The NSAC farm bill platform recommends that Congress accomplish these goals by:
- Securing permanent support for BFRDP to ensure sustained investments in new farmer training and expand priorities on succession planning, farm transfer, and transition planning
- Launching a new matched savings asset-building and financial training Individual Development Account program
- Increasing funding for the Rural Microentrepreneur Assistance Program to support 1:1 technical assistance and start-up capital to foster new farm businesses
Encouraging a Heightened Commitment to Advanced Conservation and Stewardship
Included in the farm bill’s conservation title are a handful of special incentives that specifically target support to beginning and socially disadvantaged producers. While these initiatives have had some success in connecting aspiring and beginning farmers with conservation, there are still significant barriers to the adoption of on-farm conservation activities that must be dismantled. The 2018 Farm Bill can make conservation programs more accessible and useful for beginning and socially disadvantaged farmers by:
- Increasing the existing set-aside for beginning and socially disadvantaged farmers from 5 to 15 percent within the Environmental Quality Incentives Program and the Conservation Stewardship Program
- Simplifying the EQIP Advance Payment Option to ensure automatic enrollment for beginning and socially disadvantaged farmers
- Adding a priority on beginning, socially disadvantaged, limited resource, and veteran farmer projects within Conservation Innovation Grants
What’s Next for Beginning Farmers and the Farm Bill?
As Congress ramps up work on the 2018 Farm Bill, conversations about how federal programs and policies can best support the next generation of farmers will heat up as well. Even at this early stage, there have been several beginning farmers bills introduced in both chambers that are setting the stage for the farm bill conversations ahead.
Last week, Representatives Tim Walz (D-MN) and Jeff Fortenberry (R-NE) introduced the Beginning Farmer and Rancher Opportunity Act (H.R. 4316), which lays out a comprehensive national strategy to address the critical issues new farmers face in accessing land, building skills, managing risk and financial security and investing in conservation. NSAC worked closely with both offices on this important legislation, and will be urging Congress to include this bill in its entirety in the 2018 Farm Bill.
Also in the House, Representatives Sean Patrick Maloney (D-NY) and Ryan Costello (R-PA) have recently introduced complementary legislation aimed at addressing the unique challenges faced by young farmers. The Young and Beginning Farmers Act includes policies to protect farmland, improve access to programs that assist young farmers, and support local and regional food systems.
For more information on NSAC’s 2018 Farm Bill work, click here.
Categories: Beginning and Minority Farmers, Farm Bill
The link for Maloney’s Beginning Farmer Act above is a little off. It is/should be
https://seanmaloney.house.gov/media-center/press-releases/maloney-announces-young-and-beginning-farmers-act-to-stem-coming-0
Thanks, fixed it!