The farmland financing program will help attract new entrants to the industry and allow young farmers to expand their operations, Agriculture and Forestry Minister George Webster recently told members of the PEI Federation of Agriculture.
Promised in the 2013 Speech from the Throne, the program will be administered by Finance PEI. Innovation Minister Allen Roach unveiled the details of the program just prior to Webster’s address. The agriculture minister noted the program is based on a recommendation from the federation.
The new program offers two streams and applicants can only apply under one scenario. The new entrants stream provides five-year term loans to PEI farms, up to 90% to 100% of purchase price of farmland, to a maximum of 150 acres at an interest rate of 4% with blended payments (principal and interest), commencing immediately.
The expension/succession provides five year funding for up to 80% of the purchase price of farmland, to a maximum of 450 acres. Participants have the option of making interest only payments for a period of five years at the prevailing interest rates or a fixed interest rate of 4% over the five-year term of the loan with blended payments (principal and interest), commencing immediately. The farm must be able to produce the remaining 20% of the purchase price through other sources.
To be eligible, producers must have a combination of five years of post-secondary education in agriculture and/or work experience in a farming operation. Under the new entrants stream, theymust provide financial projections showing at least $15,000 in agricultural sales
Under expansion/succession , the farming operation must be a viable business venture with a minimum annual sales of at least $15,000 from agricultural commodities or 25% of the individual’s income from farming, supported by Income Tax Returns;
“This unique new program will get results for our hard-working Island farmers, and ensure our young farmers have the opportunity and resources to participate in our agricultural economy,” said Roach. “Supporting agriculture is a strategic way to encourage entrepreneurship, create rural employment and boost exports.”
Webster added “By making capital for farming more accessible, this program fulfills government’s pledge to help new entrants to agriculture and to make it easier for those retiring or leaving the industry to pass on their lands to new farmers.
The speech by Webster was likely the last time he will address the federation, since he is not re-offering in the next election—widely expected in April or May. He told the gathering “it has truly been a wonderful experience to be the minister of agriculture.”
The Borden-Kinkora MLA, who was a potato grower before he entered the political arena, said he found himself constantly in awe of the dedication and professionalism of people involved in the industry, as well as the staff at his department.