06.06.24

Hoeven Outlines Importance of Crop Insurance, Access to Credit to Help Beginning Farmers and Ranchers

Senator Advocates for Provisions in Next Farm Bill to Ensure Next Generation of Producers Can Succeed

WASHINGTON – At a hearing of the Senate Agriculture Committee this week, Senator John Hoeven outlined the importance of providing beginning farmers and ranchers with tools to ensure the success of their operations as part of the next farm bill. Specifically, Hoeven made the case for incorporating provisions he authored as part the Farm Bill, including:

  • The Federal Agriculture Risk Management Enhancement and Resilience (FARMER) Act, legislation to strengthen crop insurance and make higher levels of coverage more affordable for producers.
  • The Producer and Agricultural Credit Enhancement (PACE) Act, legislation Hoeven introduced with Senator Amy Klobuchar to improve farmers and ranchers’ access to credit by modernizing loan limitations for U.S. Department of Agriculture (USDA) loan programs.

“We need to support the next generation of farmers and ranchers so American families continue to have access to the highest quality, lowest cost food supply in the world,” said Hoeven. “The average producer is currently close to 60 years old. We need to encourage young people to get into agriculture and to help make sure they’re successful. That includes ensuring that they are able to access affordable crop insurance, as well as the capital necessary for their operations. We have a good opportunity to do just that in the upcoming farm bill, which is why I’ve introduced legislation to bolster these important tools.”

Hoeven’s FARMER Act:

·      Increases premium support for higher levels of crop insurance coverage, which will enhance affordability and reduce the need for ad-hoc disaster assistance.

·      Improves the Supplemental Coverage Option (SCO) by increasing premium support and expanding the coverage level, providing producers with an additional level of protection.

·      Directs the Risk Management Agency (RMA) to conduct a study to improve the effectiveness of SCO in large counties.

·      Would not require producers to choose between purchasing enhanced crop insurance coverage or participating in Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs, giving them flexibility to make decisions that work best for their operations.

The PACE Act:

  • Increases loan limitations for the Farm Service Agency’s (FSA) Direct and Guaranteed Loan Programs for Farm Operating Loans and Farm Ownership Loans by the following amounts:
    • Direct Operating:  Increase from $400,000 to $750,000
    • Guaranteed Operating:  Increase from $2.04 million to $2.6 million
    • Direct Ownership:  Increase from $600,000 to $850,000
    • Guaranteed Ownership:  Increase from $2.04 million to $3 million
  • Changes the inflation benchmark for guaranteed ownership loans to the National Agricultural Statistics Service (NASS) Ag Land Values land survey.
  • Indexes the Direct Farm Ownership Down Payment Program to align with current loan limitations, helping support beginning farmers and ranchers to finance the purchase of a family farm.
  • Increases loan limitations for the FSA microloan program from $50,000 to $100,000.
  • Directs FSA to promulgate rules allowing distressed borrowers to refinance guaranteed loans into direct loans.

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