ALBANY – New legislation is focused on encouraging young farmers to follow their passions in New York state.
State Sen. Catharine Young, R-Olean, and other members of the Senate recently announced the Young Farmers NY program, which provides financial incentives for the next generation of farmers.
The average age New York farmers is 57. For every farmer under the age of 35, there are two farmers above age 65. The Young Farmers NY program centers on attracting young people to farming and supporting family farming for future generations.
“Agriculture is the backbone of our state’s economy, contributing more than $5.4 billion every year, and few work harder or face greater challenges than our dedicated farmers,” Young said. “We owe it to them and to the next generation of aspiring farmers and the agricultural leaders to enact the Young Farmers NY program and support them in their enthusiastic desire to help strengthen the farms that power our state’s economy.”
The program includes the Young Farmer Farm Preservation Tax Credit, which provides eligible farmers a tax credit for up to 10 percent of the sale price of their land and equipment. This $5 million fund aims to preserve farmland, allows retiring farmers a more equitable return on their lifelong investment and lowers the cost of farmland for beginning farmers.
The program also includes the Young Farmer Revolving Loan Fund, which will provide $5 million in startup loans for land and equipment purchases by new farmers, as well as the Young Farmer Innovation Grants, which allocate up to $50,000 for new farmers through a competitive grant program that seeks to encourage new technology and production innovation. $1 million has been dedicated to the innovation grants.
The Young Farmers NY program includes Farm Savings Accounts, a $5 million program which establishes tax-free savings accounts for the purchase of farmland or equipment and the Estate Tax Reform, a $14 million program which increases estate tax exemption to allow for the preservation of family farms passed from generation to generation.
Recently, Gov. Andrew Cuomo proposed raising the estate tax exemption to $5.25 million in his state budget plan.
With an increase for the estate tax exemption, farmers can transition their property and equipment to their children without stifling taxes. Currently, the estate tax exemption in the state is $1 million, meaning that any farm worth over $1 million is required to pay estate taxes.
According to John Knight, member of the Chautauqua County Farm Bureau board of directors, at the current exemption limit, a 150-cow dairy farm could owe roughly $400,000 in estate taxes after transitioning to the next generation – a price that often means the children are forced to sell parts of the property to pay taxes.
The Young Farmer Apprenticeship Program provides $500,000 in funding to BOCES programs to establish partnerships with working farmers and helps young people gain hands-on experience in farming.
The Young Farmers NY program also includes the Young Farmer Student Loan Forgiveness Program, which directs the Board of Regents to establish a student loan forgiveness program for up to 10 agricultural degree graduates annually who agree to work full-time in agriculture for at least five years. $100,000 has been dedicated to the loan forgiveness fund.
The program also specifies $158,000 for agricultural education, specifically increases in funding for the in-school Future Farmers of America program, which encourages careers in agriculture.
Members of the Chautauqua County Farm Bureau believe the program can make a positive impact on the county.
“The most alarming statistic was the average age of farmers in the state,” said Knight. “It shows that our farmers are getting older – if there’s isn’t a next generation coming up, who’s going to do it?”
Knight also noted that the lack of young people involved with farming in the state is not necessarily based on a lack of interest.
“There are young people out there that are interested; it’s just hard to get started,” Knight said.
Erin Urban, of Farm Credit East and member of the Chautauqua County Farm Bureau board of directors, said the Young Farmers NY program is a step in the right direction.
“I think the new Young Farmers NY plan is exciting and encouraging,” Urban said. “This new program would provide funding for high school BOCES and FFA programs, which would give hands on agricultural experience to someone who otherwise may not have the opportunity.”
Richard Kimball, president of the Chautauqua County Farm Bureau, said that the Young Farmers NY program has the potential to help the county.
“This kind of legislation is a good start – it gets discussion going,” he said.
Kimball also mentioned a meeting that took place with U.S. Sen. Kirsten Gillibrand, D-NY, a few years ago, where Kimball encouraged Gillibrand to provide incentives for older generation farmers to transition their farms to the younger generation.
“Hopefully in the future there will also be incentives for the older generation to bring in the younger generation. I still think that’s the best way to do it,” he said.
The $30 million Young Farmers NY program has been included in the state Senate’s budget resolution.
The Senate and Assembly are currently involved in a series of joint conference committee meetings to consider differences in the budget.