LANSING, Mich. — A bill approved by the state Senate on Thursday would provide $15 million for the Qualified Agricultural Loan Origination Program to aid farmers and other agriculture-related businesses impacted by the state’s unusually harsh spring weather.
“Michigan’s agriculture industry has been deeply impacted by the overwhelmingly wet spring weather our state has experienced this year, and they need some help,” said Sen. Kim LaSata, R-Bainbridge Township. “The funds made available through this legislation to provide low-interest loans to those qualified will hopefully help to lessen the financial burden of this spring’s weather.”
The Agriculture Disaster Loan Origination Program is a privately administered and public- and private-funded loan program, providing 1% interest rate loans for qualified growers, processors and agribusinesses affected by a declared agricultural disaster.
Eligibility is based on an agricultural disaster declaration and borrowers would have to certify by affidavit that they have suffered a loss of 25% or more in major enterprises or production loss of 50% or more in any one crop. Participating farmers pay a fixed 1% interest rate or a fixed interest rate based on the five-year U.S. Treasury note plus 0.25%.
According to the governor, Michigan is currently experiencing the third wettest year in state history, with 37.9 inches of rain between May 1, 2018 and April 30, 2019. It has delayed and prevented farmers from planting crops throughout the state, and the governor has requested a disaster designation for all of Michigan’s 83 counties from the U.S. Department of Agriculture.
Additionally, the governor’s office indicated that, as of June 9, Michigan farmers have had just 3.5 days with proper conditions for field work, and crops are significantly underplanted, with corn down from between 88 percent to 63 percent and soybeans at only 43 percent planted.
If signed by the governor, the loan program could begin immediately should an official agricultural disaster declaration be made.
House Bill 4234 returns to the House of Representatives to be finalized and is expected to advance to the governor for consideration.