Socially Disadvantaged and Veteran Farmers and Ranchers

Socially Disadvantaged (SDA) and Veteran Farmers and Ranchers (VFR): Title II (Conservation), Title V (Credit), Title VI (Rural Development), Title VII (Research, Extension, and Related Matters), Title XII (Miscellaneous); see also Beginning Farmers and Ranchers (BFR)

Provides support to socially disadvantaged and veteran farmers through increased funding for beginning farmer development; incentives for retiring farmers to sell or lease land coming out of the Conservation Reserve Program (CRP) to veteran farmers and ranchers; and improved outreach and communication to military veterans about farming and ranching opportunities.

Highlights

Excludes microloans used by veteran farmers from the term limits applied to other USDA direct operating loans and limits the operating loan interest rate for veteran farmers.
Funds the Transition Incentive Program that gives owners with land coming out of the Conservation Reserve Program (CRP) additional CRP payments if they lease or sell the land to a veteran farmer.
Requires USDA to set aside a portion of funding for the Environmental Quality Incentives Program (EQIP) and a portion of the acres for the Conservation Stewardship Program (CSP) for beginning and disadvantaged farmers. The 2014 Farm Act requires that preference be given to veteran farmers and ranchers that fall within these categories.
Requires USDA to give priority to veteran farmers and ranchers, along with socially disadvantaged farmers and ranchers, in awarding grants to producers under the Value-Added Development Grant Program.
Directs the establishment of a Military Veterans Agricultural Liaison to advocate for veteran farmers and ranchers and provide information to returning veterans about beginning farmer training programs.
Makes assistance for veteran farmers and ranchers a priority under the Beginning Farmer and Rancher Development Grant Program (BFRDP), including agricultural rehabilitation and vocations program training and providing a minimum 5-percent set-aside of BFRDP funding for veteran programs.

New Programs and Provisions

Definition of a veteran farmer (Title XII)—Veteran farmers or ranchers are now recognized as a distinct class of farmer who served in the United States Army, Navy, Marine Corps, Air Force, or Coast Guard, including the reserve components thereof, and who was discharged or released under conditions other than dishonorable, and who has 1) not previously operated a farm or ranch or; 2) has operated a farm or ranch for not more than 10 years.

Outreach and Assistance for Socially Disadvantaged Farmers and Ranchers and Veteran Farmers and Ranchers Program(Title XII)—Program was expanded in the 2014 Farm Act to include veterans, allowing USDA to provide additional technical assistance to veterans focused on enabling farm ownership and operation, as well as to conduct outreach to encourage participation in USDA programs.

Land Transition Incentives (Title II)—Land sales and leases to VFR are now specifically eligible for the Transition Incentives Program (TIP). Retiring farmers with land under expiring Conservation Reserve Program (CRP) contracts can receive additional payments for leasing or selling the land to a beginning farmer or rancher, a socially disadvantaged farmer or rancher, and now, a veteran farmer or rancher as previously defined.

Veteran Preferences and Priorities—Conservation Programs (Title II)—USDA is required to set aside a portion of EQIP funding and a portion of CSP-available acres for beginning and socially disadvantaged farmers and ranchers. The amount is 5 percent for beginning farmers and ranchers and for socially disadvantaged farmers and ranchers. The 2014 Farm Act requires that a preference be given to veteran farmers and ranchers who fall within at least one of these set-aside categories. USDA is also now authorized to provide additional incentives to veteran farmers for participation in conservation programs that provide new farming and ranching opportunities and enhance long-term environmental goals.

Microloan Assistance (Title V)—The 2014 Farm Act specifically excludes microloans that are held by veteran farmers from the term limits applied to other USDA direct operating loans, and modifies the USDA Operating Loan program to limit the interest rate that may be charged to veteran farmers.

Value-Added Development Grants (Title VI)—In awarding grants to producers under this program, USDA must now give priority to veteran farmers and ranchers, along with small and medium-sized family farms, beginning farmers and ranchers, and socially disadvantaged farmers and ranchers. The purpose is to assist farm businesses and producer groups in developing business plans and strategies to market value-added products.

Beginning Farmer and Rancher Development Grant (Title VII)—The 2014 Farm Act makes assistance for veteran farmers and ranchers a priority under the Beginning Farmer and Rancher Development Program (BFRDP) by specifically including agricultural rehabilitation and vocational training as an eligible service and providing a minimum 5-percent set aside of BFRDP funding for programs serving veterans. The BFRDP administers grants to organizations providing training, education, outreach, and technical assistance to beginning farmers and ranchers.

Military Veterans Agricultural Liaison (Title XII)—The 2014 Farm Act directs the Department to establish the position of Military Veterans Agricultural Liaison (MVAL) to help connect returning veterans with agricultural programs as well as assist in the use of veterans' education benefits for a farm or ranching career. The Liaison will also advocate on behalf of veterans in interactions with USDA staff to ensure veterans receive complete information on utilizing government programs and to ensure that USDA personnel understand unique veteran characteristics and the proper implementation of new veteran farmer programs. The MVAL will be able to enter into agreements with a variety of service providers to promote research, development of educational materials, workshops and vocational training, and mentorships and internships that serve veteran farmers.

Economic Implications

Microloans used by veterans have been excluded from the term limits applied to other USDA direct loans, providing veterans with more flexibility in the use of these loan funds. The change reduces the cost of capital and, like other loans offered by USDA, can be used to purchase livestock, equipment, feed, seed, fertilizer, and related supplies.

VFR and SDA farmers and ranchers should also benefit from funding priority for grants funded under the Value-Added Producer Grant program. The program will receive approximately $12.5 million annually through 2018 to help farmers and ranchers develop new markets for high-quality products meeting consumer demand for local and regional foods.