A4492 —

A4492 AAN1R Statement[First 1/19/17Reprint] ASSEMBLY AGRICULTURE AND NATURAL RESOURCES COMMITTEE   STATEMENT TO   ASSEMBLY, No.

4492  STATE withOF committeeNEW amendmentsJERSEY 217th LEGISLATURE   STATEINTRODUCED OFJANUARY NEW12, JERSEY2017   DATED:  Sponsored by:

 JANUARYAssemblyman  19,BOB 2017ANDRZEJCZAK  District      1 The(Atlantic, AssemblyCape AgricultureMay and NaturalCumberland) ResourcesAssemblyman  CommitteeANDREW reportsZWICKER favorably,District 16 (Hunterdon, Mercer, Middlesex and withSomerset) committeeAssemblyman  amendments,ERIC AssemblyHOUGHTALING BillDistrict No.11 (Monmouth) Assemblyman  PARKER SPACE District 24 (Morris, Sussex and Warren) Assemblyman  ADAM J.

4492.TALIAFERRO District 3 (Cumberland, Gloucester and Salem) Assemblyman  RONALD S.

     DANCER ThisDistrict bill,12 as(Burlington, amended,Middlesex, wouldMonmouth require the New Jersey Economic Development Authority (“EDA”), in consultation with the Department of Agriculture, to develop and administerOcean) a  beginningCo-Sponsored farmerby: loan program to facilitate the acquisition of agricultural land, agricultural improvements, or depreciable agricultural property by beginning farmers.  Under the bill, as amended, a “beginning farmer” is defined as any person with a low or moderate net worth, as determined by the department, that engages in farming, or wishes to engage in farming.  An “agricultural improvement” is defined as any improvement, building, structure, or fixture suitable for use in farming which is located on agricultural land.  “Depreciable agricultural property” is defined as personal property suitable for use in farming for which an income tax deduction for depreciation is allowable under federal law, such as farm machinery and trucks.        To qualify for a loan under the program, a beginning farmer would have to meet the following requirements:

     Assemblyman 1)DeAngelo, theAssemblywoman beginningHandlin farmerand mustAssemblyman beLand a  resident  of  the  State;SYNOPSIS      Requires NJEDA to establish loan program to assist beginning farmers in financing capital purchases.

       2)CURRENT theVERSION agriculturalOF land,TEXT agricultural     improvements,As orreported depreciableby agricultural property the beginningAssembly farmerAgriculture proposesand toNatural purchaseResources mustCommittee beon locatedJanuary in19, the2017, State;with amendments.

        3)An theAct establishing a beginning farmer mustloan haveprogram, sufficientand education,supplementing training,P.L.1974, orc.80 experience(C.34:1B-1 inet theseq.). type of farming for which the beginning farmer requests the loan;

       4)     ifBe theIt loanEnacted isby for the acquisitionSenate ofand agriculturalGeneral land,Assembly of the beginningState farmerof mustNew haveJersey: access to adequate working capital, farm equipment, machinery, or livestock;

       5)     if1.    theAs loanused isin forP.L.     the, acquisitionc.     of(C.         depreciable) agricultural(pending property,before the beginningLegislature farmeras mustthis havebill): access to adequate working capital or agricultural land;

          6)“Agricultural theimprovement” beginningmeans farmerany mustimprovement, materiallybuilding, andstructure, substantiallyor participatefixture suitable for use in farming;farming which is located on agricultural land.

          7)“Agricultural theland” agriculturalmeans land andsuitable agricultural improvements must only be used for farminguse by,in orfarming. under the direction of, the beginning farmer;

and          “Authority” 8)means anythe otherNew criteriaJersey establishedEconomic byDevelopment theAuthority authorityestablished pursuant to regulation.section 4 of P.L.1974, c.80 (C.34:1B-4).       “Beginning farmer” means a person with a low or moderate net worth that engages in farming, or wishes to engage in farming.

          The“Department” bill,means asthe amended,Department requiresof thatAgriculture.  an     EDA-approved“Depreciable loanagricultural toproperty” ameans beginningpersonal farmerproperty issuitable tofor beuse madein pursuantfarming tofor awhich loanan agreementincome withtax thededuction authority,for beardepreciation interestis atallowable ratesin andcomputing termsfederal deemedincome appropriatetax byunder the EDA,federal andInternal containRevenue otherCode.  terms     and“Farming” conditionsmeans considered appropriate by the EDAcultivation thatof areland consistentfor with the purposesproduction of theagricultural billcrops, and the regulationsraising adoptedof bypoultry, the EDA. production Theof authorityeggs, could require a beginning farmer that receives a loan under the programproduction toof submitmilk, an audited financial statement to the authorityproduction inof orderfruit to ensure the beginning farmer’s continued viability, and may, either by regulation or throughother thehorticultural termscrops, ofgrazing, the loanproduction agreement, establish terms governing the incidence of defaultlivestock, byaquaculture, ahydroponics, beginning farmer that receives a loan under the program. production The EDA would have the authority to participate in programs of theforest Unitedproducts, States Department of Agriculture Consolidated Farm Service Agency, Federal Land Bank, or any other federalactivities ordesignated Stateby agencythe indepartment thepursuant administrationto ofrules thisand program.regulations.

      COMMITTTEE“Low AMENDMENTS:or moderate net worth” means a net worth that does not exceed the maximum allowable net worth established by the department pursuant to rules and regulations.  The department shall determine the maximum allowable net worth in using data compiled by the National Agricultural Statistics Service in the United States Department of Agriculture.

            2.  a.  The committeeNew amendmentsJersey makeEconomic technicalDevelopment correctionsAuthority, in consultation with the Department of Agriculture, shall develop and administer a beginning farmer loan program to facilitate the bill.acquisition of agricultural land, agricultural improvements, and depreciable agricultural property by beginning farmers.       b.    (1)  A beginning farmer seeking a loan pursuant to this section shall apply to the authority, in a form and manner as determined by the authority, and shall include such information as the authority determines is necessary in consideration of the provisions of P.L.     , c.     (C.         ) (pending before the Legislature as this bill).

     (2)   In order to receive a loan from the authority pursuant to P.L.     , c.     (C.         ) (pending before the Legislature as this bill), the beginning farmer shall meet the following requirements:

     (a)   the beginning farmer shall be a resident of the State;

     (b)   the agricultural land, agricultural improvements, or depreciable agricultural property the beginning farmer proposes to purchase shall be located in the State;

     (c)   the beginning farmer shall have sufficient education, training, or experience in the type of farming for which the beginning farmer requests the loan;

     (d)   if the loan is for the acquisition of agricultural land, the beginning farmer shall have access to adequate working capital, farm equipment, machinery, or livestock;       (e)   if the loan is for the acquisition of depreciable agricultural property, the beginning farmer shall have access to adequate working capital or agricultural land;

     (f)   the beginning farmer shall materially and substantially participate in farming;

     (g)   the agricultural land and agricultural improvements shall only be used for farming by, or under the direction of, the beginning farmer;

and      (h)   any other criteria established by the authority pursuant to rules and regulations.

     (3)   The authority shall review completed applications and approve applications that meet the requirements of this section and the rules and regulations adopted pursuant to section 3 of P.L.     , c.     (C.         ) (pending before the Legislature as this bill).       c.     A beginning farmer loan under this section shall be made pursuant to a loan agreement with the authority, shall bear interest at rates and terms deemed appropriate by the authority, and shall contain other terms  and conditions considered appropriate by the authority that are consistent with the purposes of P.L.     , c.     (C.         ) (pending before the Legislature as this bill) and with the rules and regulations adopted by the authority pursuant to section 3 of P.L.     , c.     (C.         ) (pending before the Legislature as this bill).       d.    The authority may, in its discretion, require a beginning farmer that receives a loan pursuant to P.L.     , c.     (C.         ) (pending before the Legislature as this bill) to submit an audited financial statement to the authority in order to ensure the beginning farmer’s continued viability.

     e.     The authority may, either through the adoption of rules and regulations, or through the terms of the loan agreement made pursuant to subsection 1[d.] c.1 of this section, establish terms governing the incidence of default by a beginning farmer that receives a loan under the program administered pursuant to P.L.     , c.     (C.         ) (pending before the Legislature as this bill).       f.     The authority may participate in, and cooperate with, programs of the Consolidated Farm Service Agency in the United States Department of Agriculture, Federal Land Bank, or any other agency or instrumentality of the federal government, or with any program of any other State agency in the administration of the beginning farmer loan program.         3.    The New Jersey Economic Development Authority, in consultation with the Department of Agriculture, shall adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.),  rules and regulations necessary to effectuate the purposes of P.L.     , c.     (C.         ) (pending before the Legislature as this bill).         4.    This act shall take effect immediately.