Ohio Expands Farm Loan Funding

Recent proposals in the Ohio legislature would expand state farm lending policies, expanding access to credit and enabling more farmers to obtain farm loans. The legislation currently under consideration is House Bill 415 and Senate Bill 281, both of which would reform Ohio’s Agricultural Linked Deposit program, known as Ag-LINK.  The goal of Ag-LINK, according to state agricultural officials, is to offer farmers and ranchers interest rate reduction on farm loans offered through the Ohio treasurer’s office.

To date, Ag-LINK has helped tens of thousands of Ohio farmers obtain the capital needed to start or expand their agricultural operation, allowing existing farmers to expand their businesses and offering affordable farm loans to new farmers, who often lack significant assets. Helping young farmers has been a particularly important part of Ag-LINK’s mission statement, according to officials at the Ohio Farm Bureau. Without support from the state, many potential farmers would be unable to obtain needed farm loans and would be prevented from entering the increasingly aging farm industry. Without new farmers, many experts fear for the longevity and stability of agricultural production in the United States.
In addition to specific benefits to the agricultural sector, expanding farm credit and access to farm loans is beneficial to the larger state and national economy. Officials from the U.S. Department of Agriculture and major farm advocacy groups all agree that a healthy farm industry translates into increased job creation, leading many state agricultural officials to portray increasing access to farm loans as a way to strengthen state economies. Aside from directly employing hundreds of thousands of individuals across the country, the farm sector has a symbiotic relationship with countless American industries, from veterinary services to mechanics. Expanding access to farm credit and farms loans guarantees stronger local economies, something of critical importance in the economically ravaged Midwest.
The legislation in question would raise current caps on individual borrowing and increase state funding for the Ag-LINK program. Current caps on reduced interest farm loans are set at $100,000, which would be raised to $150,000 if the proposed bills pass. In addition, the legislation would increase the program’s maximum annual funding from $125 million to $165 million. This increased funding from the state would expand the fiscal stability of the program and would guarantee that more farmers could qualify for low-interest farm loans.