Farm storage facility loans
Radio interview source: Craig Trimm, Acting Deputy Administrator for Farm Programs, Farm Service Agency
It's expensive to maintain or build enough storage for farm products. The Farm Service Agency, or FSA, provides low-interest financing to build or upgrade facilities.
Craig Trimm is the acting deputy administrator for farm programs with the FSA in Washington, D.C. He says the farm storage facility loan program can help operations of all sizes. "That includes our grain crops, our oilseed crops, peanuts, our pulse crops, hay, renewable biomass commodities, and fruits and vegetables," Trimm says. "As far as the facility types, the three major ones that we are involved in are grain bins, hay barns, and facilities for cold storage, which are more for our fruit and vegetable producers."
The maximum principal amount of a loan is $500,000, with a minimum down payment of 15-percent. The term for repaying the loan is 7, 10, or 12 years. Trimm says all structures and equipment must have a useful life expectancy of 15 years. Trimm says borrowers also have to meet several criteria.
"The producer has to produce an actual commodity, they have to demonstrate that they need that storage capacity, we look at whether or not they have a satisfactory credit rating and the ability to repay the loan," says Trimm. "They can't be delinquent to the federal government. We require some type of proof of crop insurance, or some type of insurance coverage applicable to the crop to ensure that if they do have a loss, at least they have some repayment capabilities as far as making their payments."
If you're interested in applying, visit your county Farm Service Agency. Bring a current balance sheet and income statement, estimated costs of everything, storage capacity you now own, proof of crop insurance, and a $100 application fee.
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