The New Brunswick government plans to pump up four Agricultural Development Board (ADB) programs for new and/or established farmers with more favourable terms and, in some cases, access to more financing.
The province announced Wednesday it has introduced amendments to the related regulations under its Agricultural Development Act and Livestock Incentives Act.
The ADB’s New Entrant Farmer Loan Program, available to help a novice farmer set up a new farm or buy an established one, will see its financing limits increased to $750,000 from $500,000, “to reflect increased farm values and inflation,” the province said.
The regulatory changes will also make it possible for the ADB to take “new security instruments” other than a first mortgage, making it easier for a new entrant to get loans from other lending institutions, the province said.
The New Entrant program’s potential loan term is also to be increased to 20 years from the previous eight, the province said, and the program’s requirements for six years of educational and work experience are to be made “more flexible.”
The ADB’s New Land Lease Purchase Program, set up to help farmers during their initial establishment period by having the ADB buy eligible land on an applicant farmer’s behalf and then lease it back to him or her, will see a “more flexible” payment schedule, the province said.
Also, a Land Lease program’s stipulation that eligible land must not have been in intensive production for five years will be cut to two years. The province noted that change better reflects the program’s intent, to bring new or abandoned land into production.
The province’s amendments will also increase the term of a new farmer’s Land Lease program agreement to six years, up from five.
Perennial crops, livestock
Under the ADB’s Perennial Crop Establishment Loan Program, meanwhile, repayment terms are to be increased to a maximum of 10 years, up from the previous eight.
That program allows the ADB to advance mortgage loans for converting “ineffectively utilized” land over to perennial crops.
Also, the board’s Livestock Incentive Loan Program will move to “standardized maximum amounts” of $75,000 per farm. Under that program, the department can guarantee up to 90 per cent of a loan from a financial institution for a farmer buying and raising livestock.
The program’s previous limits were $30,000 for one person, $60,000 for partnerships of two or more people and $90,000 for corporations of three people or more.
The four ADB programs to be revised had been operated since 2000 by the province’s Business New Brunswick department. Their management was handed over to the agriculture and aquaculture department in April last year, “at the request of (the ag) industry.”
An “extensive review” of the ADB programs was then undertaken to identify “gaps between industry needs and the financing available,” the province said.