Part of the Food Policy Snapshot Series
This is the eighth in a series of Snapshots breaking down the $867 billion Farm Bill that was signed into law on December 20, 2018, and is effective through fiscal year 2023. Each Snapshot focuses on a particular section or topic within the bill and explains its implications for U.S. agriculture over the course of the next five years.
Policy Name: Title V of the Agriculture Improvement Act of 2018, aka the Farm Bill
Location: The 2018 Farm Bill is a bipartisan, federally-enacted law containing provisions and recommendations that are effective on state and local levels.
Overview: Approximately every five years, the United States Congress passes a new Farm Bill whose purpose is to reevaluate the agricultural landscape of the country and determine new protections, procedures, and funding for the various players in this diverse and interwoven network of food producers, traders, and consumers. Read more about the the general purposes and development of a Farm Bill here.
Title V of the bill covers federal credit programs that supply farmers with loans to aid them in expanding or maintaining their agricultural operations. The program that saw the greatest qualitative change under the 2018 Farm Bill is the Farm Service Agency’s (FSA) Farm Loan Programs, which is a collection of various loans at differing rates which are available to family farmers and ranchers. These loans are specifically intended to expand agricultural opportunities to historically underfunded operators, including ethnic minority farmers, women, youth, and farmers using alternative production methods.
Program/Policy Initiated: The Farm Loan Programs were started in the 1930s under the New Deal and have undergone various amendments since. You can read a brief history here. Any reforms made in the 2018 bill are effective for the 2019 coverage cycle.
Food policy category: Social and Economic Equity
How it works: Amendments to the Credit Title of the Farm Bill for the FY2019-FY2023 cycle include a mix of budgeting and practice changes to the Farm Loan Programs that will affect the eligibility requirements and the extent of loan-giving to U.S. agricultural producers. The most notable changes are as follows:
- An amendment which increases loan accessibility by specifying certain conditions under which the Secretary may reduce the requirements (typically three years of farming experience) before providing farmers with a loan, thereby making it possible for more beginning farmers to have access to federal credit.
- The Farm Loan Programs are also amended to allow alternate forms of experience as qualifiers for a loan under the FSA:
- Agriculturally-related post-secondary education.
- Completion of a farm management curriculum offered by a community college, vocational program, or agricultural non-profit.
- At least one year working as hired farm labor.
- Completion of an agricultural mentorship, internship, or apprenticeship program with a significant focus on management and related decisions.
- An ongoing relationship with someone who has farming experience and will commit to mentoring the loan recipient.
- The Bill also increases the statutory base funding for the Farm Loan Programs by more than $300,000 per borrower.
Progress to date: Given how recently the current bill was passed, it is too soon to know how these policy changes will specifically affect farmers.
Evaluation: The changes to the FSA’s Farm Loan Programs reflect a growing understanding of the circumstances and needs of our nation’s farmers. The loosening of eligibility requirements makes federal loans more accessible to historically marginalized or beginning farmers, a decision which supports a socioeconomically inclusive approach to expanding the agricultural economy. Similarly, it will be interesting to see how the allowance of alternative experience will diversify the population entering into agricultural business.
Similar practices: To understand the context and significance of the changes in the 2018 Farm Bill, it is useful to compare it to previous versions. To learn more about how the 2018 bill compares to the 2014 version, check out the first resource in the “Learn more” section below.
Learn more:
- To learn more about how the 2018 Farm Bill compares to the 2014 version, check out the Congressional Research Service’s report: https://fas.org/sgp/crs/misc/R45197.pdf.
- To learn more about how the 2018 Farm Bill affects beginning and socially disadvantaged farmers, read the National Sustainable Agriculture Coalition’s rundown here: https://sustainableagriculture.net/blog/2018-farm-bill-drilldown-beginning-farmers/
- To learn more about the details of the FSA’s loan program, check out their website here: https://www.fsa.usda.gov/programs-and-services/farm-loan-programs/
Point of Contact:
House bill sponsor Mike Conaway (R-TX-11), Washington, D.C., office:
Phone: (202) 225-3605
Or, email his office via this form.
References:
- H.R.2 – Agriculture Improvement Act of 2018
- 115TH CONGRESS 2D SESSION
- The House Agriculture Committee’s 2018 Farm Bill (H.R. 2): A Side-by-Side Comparison with Current Law
- USDA Farm Loan Programs
- 2018 Farm Bill Drilldown: Beginning and Socially Disadvantaged Farmers
- Direct and Guaranteed Farm Loans
