TWENTY-SEVENTH LEGISLATURE, 2013
STATE OF HAWAII
A BILL FOR AN ACT
RELATING TO AGRICULTURAL LOANS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Financial resources are not readily available to those new to farming or those who would like to experiment with new crops or techniques. Lack of capital oftentimes weighs heavily when deciding whether or not to choose or continue in farming as a career.
With the average age of the farm operator in Hawaii being fifty-nine years old, there is a need to encourage the younger generations to take over existing farms or start their own farms. Capital is also needed for farmers to be able to test new techniques and new crops in order to make their operations run more efficiently and thus be better able to survive foreign and mainland competition.
The purpose of this Act is to establish enhancements in the agricultural loan program to address these issues and provide incentives to enter into and to continue farming by:
(1) Expanding eligibility for the new farmer loan to include graduates of farm trainee programs;
(2) Amending eligibility criteria for the new farmer loan program to provide incentives for graduates of farm trainee programs and recent recipients of a college degree in agriculture; and
(3) Amending the purpose of the new farmer loan to include farm innovation loans for farmers to perform practical research in farming.
SECTION 2. Section 155-1, Hawaii Revised Statutes, is amended by amending the definition of "new farmer program" to read as follows:
program]" means a new farm enterprise [ for qualified new
farmers,] or a person, who by reason of ability, experience, and
training [ are], is likely to successfully operate a farm and who
otherwise [ meet] meets the eligibility requirements of section
155-10 and includes any of the following:
(1) Persons displaced from employment in an agricultural production enterprise;
(2) College graduates in agriculture;
(3) Community college graduates in agriculture;
(4) Members of the Hawaii Young Farmer Association and National FFA Organization graduates with farming projects;
(5) Persons who have not less than two years' experience as part-time farmers;
(6) Graduates from farm trainee programs designed to provide interns with the necessary hands on skills and management training to successfully operate their own farm;
Persons who have been farm tenants or farm laborers; or
Other individuals who have for the two years last preceding their
application [ have] obtained the major portion of their income from
SECTION 3. Section 155-3, Hawaii Revised Statutes, is amended to read as follows:
Restriction. Loans [
authorized by this chapter shall require two credit denials, except for
class "F" loans for new farmer and farm innovation programs,
which shall require one credit denial. This requirement shall be waived for
new farmer loans for $100,000 or less for farm trainees and recent college
graduates with a degree in agriculture. This requirement may also
be waived by the board of agriculture for emergency loans. Credit denials may
be accepted from any of the following:
(1) Private lenders;
(2) Members of the farm credit system; or
(3) The United States Department of Agriculture."
SECTION 4. Section 155-9, Hawaii Revised Statutes, is amended by amending subsection (g) to read as follows:
"(g) Class F: [
Loans for new farmer
programs shall provide for costs of a new farm enterprise for qualified new
farmers:] New farmer and farm innovation loan programs shall provide
farmer loans made under this class shall be for purposes and in accordance
with the terms specified in class "A" and "C" only, and
shall be made only for full-time farming. The loans shall be made for an
amount not to exceed $250,000 or eighty-five per cent of the cost of the
project, whichever is less[ ;]. Farm trainees and recent graduates
with a degree in agriculture with smaller projects requiring loans of $100,000
or less shall have a minimum five per cent equity contribution towards the cost
of the project;
(2) Farm innovation loans made under this class shall be for qualified farmers to perform practical research in crop development, innovative production techniques, new technologies, and production of new crops that are not typically grown in the State. Farm innovation loans shall be limited to a maximum of $75,000;
Any subsequent loan shall be made from classes "A" to "D",
respectively, depending upon the purpose for which the loan funds are used; and
(3)] (4) Borrowers shall comply with
special term loan agreements as may be required by the department and shall
take special training courses as the department deems necessary."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect on July 1, 2013.
Agricultural Loans; New Farmer; Farm Innovation
Expands the Department of Agriculture's agricultural loan program by adding farm innovation loan and expanding the definition of a new farmer. (CD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.