If you’re ready to start farming and looking for financial help and business advice, the new FarmNext program may help. FarmNext encourages new farmers to begin farming in Nova Scotia with business planning and coaching, interest rate financial benefits, and on-going financial management advice from specialists of Industry Development and Business Services Branch of the Department of Agriculture.
“Farming continues to be an exciting and valued career choice in Nova Scotia. But, challenges like access to capital are the same in Nova Scotia as throughout Canada,” explains Maria McCurdy, senior loan officer with the Nova Scotia Farm Load Board at Truro. “The FarmNEXT program will provide support with funding and coaching in business planning. The Nova Scotia Farm Loan Board will provide loans and financial lending expertise.”
The program is to encourage new farmers to begin farming in Nova Scotia. Program funds are intended to support new farmers by reducing loan principal to provide a stronger equity position for the farm business in the first year of operation. Beginning farmers will receive coaching in business planning and ongoing farm financial management advice from specialists of the Department of Agriculture.
The Nova Scotia Farm Loan Board, Nova Scotia’s agricultural lender, will also provide loans with long term fixed rates, which relates to additional stability for beginning farmers.
FarmNEXT will support new farmers by helping reduce the financial burden of their loans. New farmers may be eligible for up to $30,000 in loan relief when starting a farm business or up to $20,000 in loan relief when buying an established farm business.
FarmNEXT is an evolution of a previous program, the New Entrants to Agriculture program. In the spring of 2011, the New Entrants to Agriculture program was reviewed by stakeholders. Following the review, recommendations for program improvements were submitted for consideration. The result was creation of a new program that would have a both a funding component as well as an education/coaching component.
The New Entrants to Agriculture program has been offered for 10 years. Commitments already made to farmers and agri-businesses under the existing program will be met before the new program comes into effect.
With FarmNEXT, applicants will be considered under two categories:
- Succession: Available for succession of existing businesses and the maximum benefit to the business will be $20,000 (based on up to 2 years of interest costs). Funds will be available in the year of application.
- Beginning farmer: Available to applicants beginning a farm operation. Maximum benefit under this category is $30,000 (based on up to 4 years of interest costs). Funds will be available in the year of application.
A beginning startup farmer is defined as a person who is purchasing farm assets to develop a commercial farm for the first time, and must have at least a 51% controlling ownership in the farm. A beginning succession farmer is defined as someone who is purchasing a commercial farm or farm assets to further develop a commercial farm for the first time and who has at least 25% controlling interest in the farm.
McCurdy provides an example of the value of the program. The loan amortization schedule will provide the basis for the benefit funding. For Start up applicants, a $150,000 loan with an interest rate of 5.75 over 20 years will receive maximum benefits of $30,000 from the program.
FarmNEXT funding is available to applicants purchasing personal property. In this case, a long-term lease arrangement must be provided by the applicant. Industry Development and Business Services staff will be paired with applicants to provide coaching in business planning.
Loans will be extended by the Nova Scotia Farm Loan Board. Loans will have a 5 year amortization or greater. Applications will be available after April 1, 2012. For more information prospective applicants should contact the Nova Scotia Farm Loan Board.