Only a Few Days Left to Register for the Census of Agriculture 2017!

If you are a new farmer or rancher, or have not been contacted by National Agricultural Statistics Service (NASS), then you have until the end of June to register for the Census of Agriculture.

To qualify to be counted in the Census, you only need to have a place from which $1,000 or more of agricultural products have been produced and sold, or would have been produced and sold under normal circumstances in a particular year (here 2017).

So, if you are a farmer or rancher, please make sure that you are counted for the Census!

At 177 years old, the Census of Agriculture tells the story of U.S. agriculture. It provides the only source of uniform, comprehensive and impartial agricultural data for every county in the nation. The data are valuable to those who serve farmers and rural communities, including federal, state and local governments, agribusinesses, trade associations, extension educators, researchers, even farmers and ranchers themselves. Census results help shape farm programs and boost services for communities and the industry. The Census of Agriculture is a farmer or rancher’s voice, future, and opportunity. For more information about the 2017 Census of Agriculture, visit www.agcensus.usda.gov or call (800) 727-9540.

 

Source: https://www.agcensus.usda.gov/Newsroom/2017/06_22_2017.php

NOP Proposed New Rule on Organic Certification, Pt. 3

Happy Friday all! We close out this week with more on the NOP proposed new rules on Organic Certification. Today’s post deals with one of the biggest changes to the program – Avian living conditions – and a couple notes about transport and slaughter facilities. Again, the rule has been postponed to allow for a 30-day period for the public to comment on what action should be taken regarding the new rule. If you would like to comment on the course of action for the new rule, please visit: https://www.federalregister.gov/documents/2017/05/10/2017-09410/national-organic-program-nop-organic-livestock-and-poultry-practices-second-proposed-rule

The proposed final rule may be found in its entirety here: https://www.federalregister.gov/documents/2017/01/19/2017-00888/national-organic-program-nop-organic-livestock-and-poultry-practices.

AVIAN LIVING CONDITIONS

Avian living condition rules have been changed as well. The requirement for birds to have indoor space has been removed, but shelter must still be provided. Should you choose to provide indoor space for your birds, then you must comply with the requirements for indoor space. Indoor space must be large enough so that the birds may engage in natural behaviors and move freely.

Ammonia must be monitored monthly. When ammonia levels exceed 10ppm, remediation and additional monitoring must take place. Ammonia levels are not allowed to exceed 25ppm.

Natural lighting in the indoor space must be sufficient so that an inspector is able to read and write on sunny days while any artificial lights are turned off. Artificial lights may be used to augment natural light up to a 16-hour period per day. Artificial lights must be lowered gradually to encourage birds to settle in for the night.

Space requirements are given a significant overhaul with this new rule. 6 inches of perch per laying bird is required, although the lighting rail may count towards this requirement. For indoor exits, the requirement was removed that all birds must be able to exit within one hour. The new indoor density requirements for layers must not exceed (live bird weight): (i) Mobile housing: 4.5 pounds per square foot; (ii) Aviary housing: 4.5 pounds per square foot; (iii) Slatted/mesh floor housing: 3.75 pounds per square foot; (iv) Floor litter housing: 3.0 pounds per square foot; (v) Other housing: 2.25 pounds per square foot. The indoor density for pullets must not exceed 3.0 pounds of bird per square foot. For broilers, indoor stocking density must not exceed 5.0 pounds of bird per square foot.

Outdoor space has also been given new density requirements. For layers, outdoor space must be provided at a rate of no less than one square foot for every 2.25 pounds of bird in the flock. For pullets, outdoor space must be provided at a rate of no less than one square foot for every 3.0 pounds of bird in the flock. For broilers, outdoor space must be provided at a rate of no less than one square foot for every 5.0 pounds of bird in the flock. The outdoor space must be at least 50% soil with “maximal vegetative cover”. As above, work with your certifier to ensure compliance with this requirement.

Temporary confinement for birds is also allowed in certain circumstances, such as inclement weather, certain stages of life, health and safety risks, reseeding of soil, sorting for shipping, and nest box training, among others. All temporary confinements must be recorded.

TRANSPORT AND SLAUGHTER

New guidelines about transport and slaughter have been established in the rule. Foremost is that organic animals must be identified as such during transport. Trailers must provide season-appropriate protection from heat and cold, and must have bedding provided for anything other than poultry crates. Organic feed and clean water must be provided every 12 hours during transport, regardless of whether the trailer is moving or not. Operations that transport organic livestock must also develop an emergency plan to address reasonably foreseeable issues during transport, such as feeding, escapees, and euthanization of injured animals during transport.

Organic certified slaughter facilities must be in compliance with the Humane Methods of Slaughter Act of 1978. Certified facilities must also provide any documentation of FSIS noncompliance and corrective action records to certifying agents upon request.

 

“Always do your best. What you plant now, you will harvest later.” – Augustine “Og” Mandino

NOP New Proposed Rule on Organic Certification

For certified organic producers and those who are seeking to become organic certified, there is a new final rule coming down the pipeline that will likely affect your operations. Among the changes are new rules regarding animal welfare, living conditions centered on outdoor access for both poultry and mammals, as well as transport and slaughter. As of May 10, 2017, the rule has been postponed to allow for a 30-day period for the public to comment on what action should be taken regarding the new rule. If you would like to comment on the course of action for the new rule, please visit: https://www.federalregister.gov/documents/2017/05/10/2017-09410/national-organic-program-nop-organic-livestock-and-poultry-practices-second-proposed-rule

If you believe that you may be affected by this new final rule, please take a look at the rule itself. Also, if your certifier has not reached out to you, make sure you contact them to discuss in detail all the proposed changes required for your specific operation. The final rule may be found here: https://www.federalregister.gov/documents/2017/01/19/2017-00888/national-organic-program-nop-organic-livestock-and-poultry-practices. Following is not a comprehensive list of changes, but some key highlights of the new rule.

The first set of major changes has to do with the definitions of certain terms. Notably, any areas that are roofed, but allow the animals to freely move from cover to the outside, may now be counted as ‘outdoor space’. The final rule will now prohibit some types of physical alterations to livestock. Therefore, eight terms have been defined in the rule to account for any local differences in the naming of certain alterations. The definition of stocking density has also been changed to be expressed in terms of pounds of bird per square foot, instead of individual birds per square foot.

Livestock Healthcare practices also see some significant changes as well. Needle teeth clipping and tail docking in pigs may no longer be performed routinely, under the new rule they may only be performed in response to a documented welfare reason, and other alternatives must have failed. For poultry, the new rule prohibits the following practices: de-beaking, de-snooding, caponization, dubbing, toe-clipping of chickens, toe-clipping of turkeys (unless with infra-red at hatchery), and beak clipping after 10 days of age. Forced molting has also been prohibited.

USDA is making it easier to transfer land to the next generation of farmers and ranchers.

Key points from the USDA’s announcement concerning the early termination of Conservation Reserve Program (CRP) contracts.

  • The goal is to make it easier for the next generation of farmers and ranchers, including family members, to acquire land.
  • USDA technical teams will determine which acres are ready to be productive with minimal impact on overall conservation efforts.
  • If land is determined to be ready a landowner can terminate their CRP contract early without being required to repay all previous payments plus interest.
  • This policy waives repayment requirements if the land is being transferred to a beginning farmer or rancher through sale or lease with the option to buy.
  • By clearing some of these CRP acres from the programs 24 million acre cap the USDA will be able to enroll other land with a higher conservation value.

For more information and details on this early termination opportunity visit www.fsa.usda.gov/crp or read the complete announcement at https://www.fsa.usda.gov/state-offices/Nebraska/news-releases/2016/stnr_ne_20161230_rel_408.

Value Added Producer Grants Available for Beginning Farmers

As the Center for Rural Affairs reminded me, USDA Value Added Producer Grants are now available.  What do you need to know about the grants?

First, the goals of the grant program is to generate new products, create and expand marketing opportunities, and increase producer income.  Beginning farmers, socially-disadvantaged farmers, and a small to mid-sized farm structured as a family farm (along with a few other categories) may receive priority in funding.

Approximately $10.5 million is currently available.  More funds may come available should additional funds be allocated to the program.  Grants are awarded on a competitive basis.  The maximum grant amount is $75,000 for planning grants and $200,000 for working capital grants.

Today, December 16th at 1:00 p.m. Eastern time, the USDA will hold a webinar about the program.  The webinar will be recorded so it is likely that it will be available for viewing at a later date.

More information on the process for applying for the planning or working capital grants is here.  Included in that information are templates for applying for a planning or working capital grant.  If you’d like to read the announcement of funding in the Federal Register, you may do so here.  A detailed fact sheet from the Center for Rural Affairs, including resources for help in completing the grant application, is here.  The deadline for applications is February 24, 2014.

If you have any questions, please feel free to contact us.  We’re always happy to help.

A short guide on South Dakota law for leasing agricultural land.

South Dakota has a few wrinkles in their laws that are unlike Nebraska’s laws regarding the lease of agricultural land.  What do you need to know?

  1. South Dakota does permit oral leases, but those leases are only year-to-year leases.  South Dakota does not permit an oral multi-year lease.
  2. If there is no contract or usage to the contrary, rent is payable yearly at the end of each year.
  3. If your oral lease is for forty acres or more, special provisions apply to terminate the lease.  A landlord must give written notice on or before September 1 to terminate the lease or it is renewed automatically.  If notice is given on or before September 1, the lease terminates on March 1.  This is applicable to tenants leasing crop land and grassland, either native or tame.
  4. If you have a written lease, the above provisions regarding notice to terminate are not applicable.  The termination provision(s) in your written lease determine how and when the lease is terminated.
  5. If you are seeking a multi-year lease, it must be in writing.  Keep in mind that any lease for agricultural or wildland may not exceed twenty years.

The takeaways from above?  While oral leases are permitted in South Dakota, it is only on a year-to-year basis.  Further, if more than 40 acres is leased, notice to terminate the lease must be given prior to September 1st.  Written leases are preferred in the law, although a lease for agricultural land may not last longer than twenty years.

What is this I hear about liens?

It is not a topic many people want to think about, but what happens if you do custom work for a farmer and you do not get paid?  Every state has various laws to deal with this scenario. Nebraska and South Dakota have a number of different liens that may be filed, as every state does.

The National Agricultural Law Center maintains a listing of Nebraska and South Dakota liens.  Each state is discussed below:

Nebraska:

Nebraska requires most individuals filing a lien to do so through a financing statement.  A financing statement is part of Article 9 of the Uniform Commercial Code.  What is a financing statement in Article 9 of the Uniform Commercial Code?  It is a form that a creditor (here, the person filing the lien) files to give notice that the creditor may have an interest in the personal property of a debtor (the person who owes the creditor money).  The filing allows the creditor to “perfect” his or her interest, meaning that the creditor has an interest in specific property which would then be given a specific place in the priority of creditors to be paid.

The Nebraska Secretary of State is where financing statements are filed.  To obtain a financing statement to file, the Nebraska Secretary of State provides the form to fill out.  There is a filing fee to file the financing statement; the fees are listed here.

Keep in mind that a financing statement is effective for five years after the date of filing and is considered lapsed.  A continuation statement may be filed within six months of the expiration of the five year period.  Should the financing statement lapse, the lien will no longer be perfected, meaning your place in the priority for payment will be considered to have never existed.

In summary, know what type of lien is applicable to you and whether you must file a financing statement.  If you need assistance answering these questions, contact us!

South Dakota:

South Dakota does not have the Uniform Commercial Code requirements that Nebraska has.  In South Dakota, the county Register of Deeds is where liens are filed.  The procedures under the Uniform Commercial Code are not applicable in South Dakota for agricultural liens.

But just like Nebraska residents, if you have a question about liens, feel free to contact us!

FSA’s New Microloan Program

I’m sure you have heard about the Farm Service Agency’s new microloan program but nonetheless, since a few months have passed since the announcement, now may be a good time for a reminder about the program.

As background, FSA devotes a percentage of its resources to assisting beginning and socially disadvantaged farmers.  As a result, the microloan program may be one in which beginning farmers are interested for the reasons detailed below and the FSA will be able to assist.

As you may or may not know, the FSA can now provide “microloans”, which were developed to for beginning, small, and niche farming operations.  The loans are for up to $35,000 payable over seven years.  While the microloan program requires farm management experience, the requirement is flexible.  This can be met by prior farming experience, apprenticeship, or past participation in organizations such as 4-H, Future Farmers of America, beginning farmer programs, and community-based organizations.  Further, small business experience along with a self-directed apprenticeship can allow a person to start farming with a microloan.

What may the loans be used for?  Examples include initial start-up expenses, direct marketing to restaurants and grocery stores, organic production, farmers markets and/or community supported agriculture, purchase of breeding livestock, delivery vehicles, annual expenses such as feed, fertilizer, and/or land rent, and minor farm improvements.  Importantly, microloans may also be used for family living expenses.  These are only examples, however; other expenses and needs may also be funded through microloans.

The microloans provide a bridge between the FSA Youth Loans and more traditional loans for larger-scale production.  As a result, the paperwork and application process is streamlined and simplified for a microloan than traditional operating loan from the FSA.  Most importantly, an itemized cash flow budget are not required for the microloan.

What is the catch?  Frankly, I cannot think of any.  For small and beginning farmers, the microloan program is an opportunity to finance your operation in a small, managed way.

The FSA’s FactSheet is here and provides guidance.  Go here to locate your local FSA office or here to access the microloan forms.

As always, if you have any questions or need assistance, feel free to contact Legal Aid of Nebraska online or at 866-660-1391.

USDA designates 89 Nebraska counties as primary natural disaster areas

The USDA designated 89 Nebraska counties as primary natural disaster areas due to the drought.  Further, surrounding contiguous counties are also eligible to receive assistance.  This includes counties in South Dakota, Wyoming, Kansas, Colorado, and Missouri.

Due to the natural disaster designation, farmers and ranchers are eligible for emergency loans from the Farm Service Agency if eligibility requirements are met.  Farmers and ranchers have eight months from the time of the natural disaster declaration to apply for loans.

 

South Dakota Beginning Farmer Bond, Part 2

We previously discussed the South Dakota Beginning Farmer Bond Program (SDBFBP) eligibility and qualification requirements.  This post discusses some of the nuances involved with SDBFBP.

Is there a minimum loan amount for the SDBFBP?

No.  There is, however, a maximum amount.  Under federal law, the loan maximums are %501,000 for agricultural land and agricultural improvements and $250,000 for new depreciable agricultural property.  Of the depreciable agricultural property, no more than $62,500 may be used for used property.

Can the beginning farmer purchase a residence with the proceeds from the loan or sales contract which is secured by the bond?

Yes if certain stipulations are met.  If the residence is a minor part of a farm or acreage purchase, it can be included as part of the loan.  No more than 5% of the bond proceeds can be used towards the purchase of a house.

Can I purchase farmland that is enrolled in CRP?

The purchase of farmland that is entirely enrolled in CRP is not permitted.  However, depending upon whether a portion of the bond proceeds are used to purchase a residence (which cannot exceed 5% of the bond proceeds), 20-25% of the bond proceeds may be used to purchase CRP farmland.

Can I purchase “working capital” such as feed, see, fertilizer etc.?

No.  The financing of working capital is not permitted.  This limitation also includes feeder cattle, feeder pigs, and/or feeder lambs.  However, livestock used for breeding or dairy purposes may be purchased.

Is it possible to re-finance existing debt?

No.  Any debt that has been incurred by the beginning farmer prior to 60 days of the approval of the bond may not be re-financed.

These are some of the common questions and answers above.  The SDBFBP may seem complicated but it may be the program for a beginning farmer.   You may have additional questions and we welcome that!   If you have any questions, feel free to contact Legal Aid of Nebraska at 855-660-1391.