The Official U.S. Maple Syrup Almanac -- 2017 Alamanc_2017 | Page 45

BUSINESS SIDE
Low-interest loans available to maple producers
LOAN RATES
By DEBORAH JEANNE
SERGEANT
Could you use a loan for expanding
your maple operation’s storage capacity?
You’re in luck--if you qualify.
FSA’s Farm Storage Facility Loan
(FSFL) program offers farmers low-inter-
est loans to improve their farm’s storage
capacity and includes maple operations.
David Holck, executive director for
Farm Service Agency for Washington,
Warren, Saratoga and Rensselaer coun-
ties in New York, said that containers for
maple sap and lines to the evaporator are
eligible for FSFLs, and, an addition to the
FSFL recently announced by the USDA,
containers for syrup, too.
Holck said that farmers must prove
their need for sap or syrup storage or
tubing, pay a $100 application fee, and
complete the paperwork.
Even producers able to acquire com-
mercial credit may apply for the FSFL.
The program is meant to help small to
mid-sized farms, new producers, and
underserved farmers.
Holck advises producers to know
how much they will spend before they
approach their FSA office about the loan
since they will need a down payment of
15 percent for loans over $50,000. For
a loan between $50,000 and $100,000,
producers the equipment provides the
security. For items over $100,000, farm-
ers must present more security, “often in
the form of real estate,” Holck said.
Though FSA runs a credit report, a
producer’s credit score doesn’t necessar-
ily affect his approval for a FSFL as much
as the balance sheet. Holck said that the
U.S. Maple Syrup Almanac
2017
Interest rates for loans disbursed in
May are as follows:
Loan Term
Interest Rate
3 years
1.500%
5 years
1.875%
7 years
2.125%
10 years
2.375%
12 years
2.375%
For more information about the
Farm Storage Facility program, visit
www.fsa.usda.gov/pricesupport.
FSA wants to see the last 90 days’ assets
and liabilities and the credit report helps
confirm the information. He compared
the FSFL with a vehicle loan.
Depending upon the producer’s busi-
ness structure, the FSA may need to see
his personal assets and liabilities, too.
“We’d need a cash flow projection
to show income and analyze based on
their cash flow, if they’d generate enough
income to make their loan payments,”
Holck said. “Any producer would have
to show their ability to repay. If it shows
on paper you have the ability to make the
payments, I don’t anticipate any problems
in approving the loan.”
Once the producers purchases and
installs the equipment, the FSA can close
and disperse the funds. Holck said that
the producer may need to talk with his
supplier or use a line of credit to acquire
the equipment.
“Now’s the time to start thinking about
upgrades and applying,” Holck said. “It
can take a couple months between apply-
ing and getting it all done. This is timely
for producers to start the process rolling
so everything is in place by the time they
want to start tapping.”
The interest rate is fixed until the loan
is paid off.
If you’re unsure about whether the
loan could apply to your business, Holck
advises calling your local FSA office to
discuss your farm’s needs.
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