DATE: Friday, March 14, 1997                TAG: 9703140630

SECTION: LOCAL                   PAGE: B01  EDITION: NORTH CAROLINA 

SOURCE: JEFFREY S. HAMPTON, CORRESPONDENT 

DATELINE: ELIZABETH CITY                    LENGTH:   64 lines

LOAN PROGRAM DESIGNED FOR NEW FARMERS GETS ATTENTION

A loan program with an extra low down payment for new farmers announced last week by North Carolina Agriculture Commissioner Jim Graham has drawn enough inquiries to fill a grain silo.

``I was out sick last week and when I came in Monday my desk was covered with them,'' said Billy Price, a loan officer with the Agricultural Finance Authority. The AFA has not counted the exact number of applications yet, but Price said ``they're calling one after the other.''

The loan program is so new, an officer with the Elizabeth City Farm Credit office was not aware of it and referred inquiries to the state headquarters in Greensboro. Agriculture extensions agents have not heard of it, either.

``There's definitely some opportunity here,'' said a surprised Al Wood, the agriculture extension agent for Currituck County.

The loan removes the largest obstacle to going into farming, the up-front money to get started, Wood said.

Conventional farm loans usually require a 20 to 25 percent down payment and are financed for only 10 years, said Tommy Emerson, an officer with the Farm Credit Association.

The AFA combines with Farm Credit to loan up to 95 percent of the farmland's appraised value, according to a release from the state Department of Agriculture, and allows a payoff period of 25 years. Applicants can get up to $300,000 with an interest rate of prime plus 1.75 percent.

The FCA is a co-op of farmers who hold stock in the federally regulated company.

In an industry where the average age is 52 and rising, the new loan is a carrot to attract more young people to farming.

``It's very difficult to get started in farming because of the cost of land and equipment,'' said Tom Campbell, the agriculture extension agent in Pasquotank County. ``When the old farmers die there are not that many young farmers to take over.''

``This is probably one of the biggest worries,'' said Price. ``Who's going to be on the farm torun it? We're going to be left short some day.''

The new loan program is the result of a challenge issued by Graham two years ago to help beginning farmers get started, Price said. The Department of Agriculture sponsored a similar program eight years ago that required a 10 percent down payment and a shorter payoff period. The new loan sweetens the offer even further.

The lack of young farmers accelerated when debts incurred during the 1970s overwhelmed many farmers during hard times in 1980s, said Don Baker, the agriculture extension agent in Pasquotank County.

``There are very few sons joining the family farm operation,'' said Baker. ``If they do go into farming, it's usually part time. They have full-time jobs and farm on the side. That's been the trend in recent years.''

Many family farms became subdivisions. Baker said Pasquotank County has lost thousands of acres to development in recent years, yet the county has not dropped in agricultural production.

``Scientific advancements have continued to outpace the loss of land,'' said Baker. ``I don't fear ever not having enough food produced on the land available.''

The loan, however, is available to more than conventional row-crop farmers, said Price. He has requests for goat ranches, nurseries, aquaculture ponds and hog farms.

``This loan is designed for the acquisition of long-term assets,'' said Emerson. ``I don't think it's a cure-all for young farmers, but I do think it is a step in the right direction.''

For more information, call (919) 733-0635.

Send Suggestions or Comments to webmaster@scholar.lib.vt.edu