H 3183 — Young Farmer Loan Program

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06, 2024) - South Carolina Legislature Online South Carolina General Assembly126th Session, 2025-2026Bill 3183Indicates Matter StrickenIndicates New Matter(Text matches printed bills.

Document has been reformatted to meet World Wide Web specifications.)                 A bill   TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING SECTION 48-59-160 SO AS TO ESTABLISH THE "YOUNG FARMER LOAN PROGRAM" UNDER THE SOUTH CAROLINA CONSERVATION BANK ACT;

AND BY AMENDING SECTION 48-59-50, RELATING TO BANK POWERS AND DUTIES OF THE SOUTH CAROLINA CONSERVATION BANK, SO AS TO PROVIDE THE BANK SHALL ADMINISTER THE "YOUNG FARMER LOAN PROGRAM."   Be it enacted by the General Assembly of the State of South Carolina:

  SECTION 1.  Chapter 59, Title 48 of the S.C.

Code is amended by adding:

      Section 48-59-160.

(A) Notwithstanding any other provision of this chapter or law to the contrary, the South Carolina Conservation Bank shall establish, operate, and administer the "Young Farmer Loan Program" pursuant to the provisions contained in this section.

    (B) To be eligible for a loan, a person must submit a loan application to the Department of Agriculture.

At the time of submitting the loan application the person must:

       (1) be at least eighteen years of age and no older than forty years of age;

       (2) have at least three years of farming or agriculturally related activity experience;

       (3) have a net worth of no more than $300,000;

       (4) be required to take title to the farmland in an individual name;

       (5) have farmland subject to the purchase that contains at least fifteen tillable acres;

       (6) not own or have an ownership interest in more than twice the tillable acres of farmland than the amount of tillable acres subject to purchases with loan monies;

       (7) purchase farmland located in this State;

       (8) be a resident of this State;

       (9) purchase farmland that may be comprised of a combination of tillable acres, forestlands, or wetlands;

provided, however, that the farmland property is zoned for agricultural usage;

       (10) purchase farmland that is not subject to an existing preservation easement, conservation easement, or similar limitation which restricts residential or commercial development;

and        (11) contractually commit that he will be actively engaged in agricultural usage of the purchased farmland during the term of the loan.

    (C) The Department of Agriculture shall transfer all loan applications it receives to the bank for review and approval.

       (1) The bank shall adopt a loan application form requesting information from the loan applicant which includes, but is not limited to, information regarding loan eligibility.

       (2) The following requirements and conditions shall apply to loans provided by the bank:

           (a) the maximum total amount of loans provided to an individual recipient shall not exceed $500,000;

           (b) the maximum loan amount for any loan shall not exceed seventy percent of the appraised easement value of the farmland property which is being purchased and subject to perpetual preservation easement;

           (c) a condition of the loan is that the eligible farmland being acquired is to be subjected at closing to a permanent preservation easement in the form determined by the bank, the easement to have priority status and not be subject to subordination;

and            (d) the loans provided by the bank shall be secured by Notes and Mortgages which allows for the following conditions:

               (i) the Notes and Mortgages will be subordinated to other loans provided for the purchase, in whole or in part, of the eligible farmlands;

provided, however, that the perpetual preservation easement placed on the eligible farmland property at the time of settlement shall not be subordinated;

               (ii) the Notes and Mortgages shall bear no interest and the payback may be structured for final payback within thirty years, with initial payments to begin after the primary commercial or other financing for the purchase of the farmland property is satisfied or released;

and                (iii) the Notes and Mortgages shall contain a requirement for payment in full of the balance of the loan upon the sale or transfer of the secured farmland property;

provided, however, the bank shall have the discretion to allow for assumption of the loan by the transferee under such terms and conditions deemed advisable, provided the transferee satisfies the loan eligibility requirements set forth in this subsection.

       (3) Loans shall be limited to the purchase of farmland and farmland improvements only.

Portions of the property subject to purchase which are used or proposed for use for residential purposes shall not be eligible for loans.

       (4) The approval of loans by the bank under this subsection is purely a discretionary function and the bank shall be under no obligation to provide a loan to any applicant.

    (D) The preservation easements provided as a condition for receiving a loan under this section shall include, but not be limited to, the following conditions:

       (1) the preservation easement binds and runs with the farmland in perpetuity;

       (2) no residential use is allowed on the farmland subject to the preservation easement;