USDA Funding Available

Farm Storage Facility Loan Program

 

Proper storage, both on-farm and mobile, is essential to keeping food fresh and safe prior to marketing. Now, thanks to new federal rules, farmers serving local and regional markets will have more options to finance the storage facilities and equipment they need for a successful operation. On Friday, April 29, the U.S. Department of Agriculture’s (USDA) Farm Service Agency (FSA) announced that farmers can now use the Farm Storage Facility Loan (FSFL) program to help finance portable storage structures, portable equipment, and storage and handling trucks; the program will also continue to support stationary crop and cold storage on-farm facilities.

Program Details
Expansion of the low-interest FSFL program will allow FSA to better serve fruit and vegetable as well as other producers who need specialty equipment to get crops safely and efficiently to local farmers markets, schools, restaurants, food hubs, and retail establishments. The new program changes announced this week will allow financing for portable storage structures, portable equipment, and storage and handling trucks. Previously, only permanently-affixed and stationary equipment and facilities were eligible for financing under this program.

In the past two years, FSA has expanded the program to make produce packing sheds eligible. FSA also expanded program eligibility to unprocessed meat and poultry, eggs, milk, cheese, butter, yogurt, flowers, hops, rye, and aquaculture – products previously not included in the FSFL program. The agency also started to coordinate the storage loan program with other federal farm credit programs, which enables farmers to put together loan packages more easily and cover a wider range of their financing needs.

The program also offers a new "microloan" option, which allows applicants seeking less than $50,000 to qualify for a reduced down payment of five percent and no requirement to provide three years of production history. Farms and ranches of all sizes are eligible. The microloan option is expected to be of particular benefit to smaller farms and ranches, and specialty crop producers who may not have access to commercial storage or on-farm storage after harvest.

How to Apply
Loan applications should be filed in the local FSA Office that maintains the farm’s records. To find your local office, use the USDA service center locator. The Farm Storage Loan application form is CCC Form 0185 and can be found on the FSFL overview page.

Background
The current version of the FSFL program was created in 2000 by FSA. The program has permanent mandatory funding through the Commodity Credit Corporation (CCC) and does not require a congressional authorization or an appropriation. The costs of running the loan program are automatically reimbursed to the CCC.

In the 2008 Farm Bill, Congress added hay and renewable biomass as well as fruits and vegetables as eligible commodities, added cold storage as eligible facilities, increased the maximum loan term and loan about, and allowed for partial loan disbursement during construction.

In 2014, FSA took several actions to improve the program, particularly for small and mid-sized farms serving local and regional markets, including:

  • Producers can now provide information on sales, volume sold (based on farmers market space or vehicle size), CSA shares, or other similar measures, instead of the typically required three-year acreage yield reports
  • Waiving the requirement to first obtain crop insurance or non-insurance crop disaster assistance program (NAP) coverage on a case-by-case basis
  • Allowing loans for financing packing sheds and certain handling equipment, such as packaging, cold dip tanks, sorting and grading bins and tables, washers, and waxers, among others.

The storage program’s expansion to cover mobile equipment and vehicles came via a federal rulemaking, published in the Federal Register on Friday, April 29, 2016, which became effective immediately upon publication.

More Info
FSA's FSFL webpage
FSA’s FSFL Fact Sheet
FSA FSFL Handbook
Farm Storage Loans Expanded to Help Farmers Reach Local Food Markets - blog post from NSAC
FSFL page in NSAC's Grassroots Guide to the Farm Bill

Photo Credit: Trent Campbell