Every tool in the toolbox is an important one to farmers and ranchers, especially when livestock producers continually face depressed market prices, weather extremes and busy schedules.
For producers looking to expand their herd or shop for specific genetics, the Family Farm Breeding Livestock Tax Credit Program offered by the Missouri Agricultural and Small Business Development Authority (MASBDA) may be the tool worth reaching for.
The program provides a state tax credit to a lender in the amount of the first year’s interest for loans made to purchase breeding stock. The savings of that first year’s interest payment could make a contribution toward expenses like an extra bred heifer or additional feed costs for the year.
“Small farmers make up an important part of Missouri’s livestock industry,” said Jill Wood, executive director of MASBDA. “Waiving the first year’s interest will keep that cash in the farmer’s pocket and allow them to increase their herd size, or even assist new producers in making their first livestock purchase. Missouri’s livestock industry accounts for more than $3 billion in cash receipts each year and is a major part of our state’s economy.”
With a large number of cattle operations in Missouri, many producers are still eligible to utilize the program, and MASBDA urges producers to visit with their lenders on how the program can benefit their operation. Steven Luetkemeyer, a fourth generation cattle farmer, saw the opportunity to utilize the program and did just that.
When asked what advice Steven would give other producers, he said using your resources and knowing your capacity was important.
“Anything helps; you can have an impressive income, but all the expenses add up,” Luetkemeyer said. “I took the difference and invested it into the principle cost of my loan. Don’t jump in too big, too quickly; watch every dollar and remember you don’t always need to have the biggest, newest and best equipment as a small farmer. The old fits just the same.”
Scott Juergensmeyer, lending officer and vice president of Mid America Bank in Meta, has used the Family Farm Breeding Livestock Loan program to help some of his borrowers start or expand their livestock operations.
“The program offers minimal paperwork, eliminates a cost variable for producers and allows the bank to control all aspects of the loan,” Juergensmeyer said.
The program is targeted to small farmers and ranchers that have less than $250,000 in gross agricultural product sales per year and is limited to one qualifying loan per household. The maximum loan for beef cattle is $75,000; however, the program supports the purchase of other livestock as well: $75,000 for dairy cattle, $30,000 for sheep, $30,000 for goats and $35,000 for hogs.
With nearly 100,000 farms in our state, agriculture is Missouri’s number one economic driver, with agriculture contributing more than $88 billion to the state’s economy. The Missouri Agricultural and Small Business Development Authority’s focus is working with Missouri’s agriculture producers and agribusinesses on their plans for the future.
For more information regarding the Family Farm Breeding Livestock Loan Program or MASBDA, visit Agriculture.Mo.Gov or call (573) 751-2129.