New Law Establishes Low Income Loan Program for Agricultural Disaster
The "agricultural disaster loan origination program of 2012" provides for a low interest loan program for growers, processors and agribusinesses affected by major crop loss from the extreme weather this spring.
September 1, 2012
Signed into law by Governor Snyder on June 26, 2012, the “agricultural disaster loan origination program of 2012” provides for a low interest loan program for growers, processors and agribusinesses affected by major crop loss from the extreme weather this spring. The program creates a partnership between private lenders and the state where private lenders extend a one percent interest rate to eligible growers and processors and the state supports the process by paying lenders a loan origination fee totaling five percent of the original loan amount, paid out over five years. The Michigan Farm Bureau estimates that for the maximum state investment of $15 million specified in the law, the state will support more than $500 million in annual economic activity.
Given estimates that between 80 – 95% of many tree and vine fruit crops in Michigan were destroyed by the early warm weather followed by late freezes, this program will hopefully provide a crucial source of cash flow for many growers, processors and agribusinesses. See the text of Public Act 193 of 2012 for more information.