Federal funds sought for beginning farmer program

State funding for administration of the Beginning Farmer Tax Credit Act could be replaced with federal funds under a bill heard by the Agriculture Committee Feb. 22.

LB356, introduced by Holdrege Sen. Tom Carlson, would direct the state Department of Agriculture to use federal rural rehabilitation funds to pay the administrative costs of the Beginning Farmer Tax Credit Act and the Beginning Farmer Board.

The Beginning Farmer Tax Credit Act provides landowners who rent agricultural land to beginning farmers with a refundable tax credit equal to 10 percent of the cash rent or 15 percent of the value of the share crop rent received each year for three years.

Jay Rempe, representing the Nebraska Farm Bureau, testified in opposition to the bill, saying it would divert resources from agricultural education, youth and training programs such as FFA, Nebraska LEAD and Nebraska Agriculture in the Classroom.

Don Anthony, chairperson of the Beginning Farmer Board, testified in a neutral capacity. He said the beginning farmer program had 83 applicants last year and annually administers approximately $1.5 million in tax credits.

Greg Ibach, director of the state Department of Agriculture, also testified in a neutral capacity, saying the investment earnings of rural rehabilitation funds have varied in recent years. In order to cover the $45,000 in annual administrative costs for the Beginning Farmer Tax Credit Act, he said, support for existing programs that depend on the federal funds would need to be reduced.

The committee took no immediate action on the bill.