Next Generation Farmland Acquisition Program
("Next Gen Program")
To apply, see the Application page
Thanks to the support of the Governor and the Maryland General Assembly, the Maryland Agricultural and Resource-Based Industry Development Corporation (MARBIDCO) is launching the Next Generation Farmland Acquisition Program ("Next Gen Program") this year to help qualified young and beginning farmers who seek to purchase farmland, but need some financial assistance to enter (or continue in) the agricultural profession due to relatively high farmland costs and a lack of access to capital. The Next Gen Program is basically a rapid-response, farmland conservation easement-option-purchase program, designed to help facilitate the transfer of farmland to a new generation of farmers, while also effectively helping to preserve agricultural land from future development. MARBIDCO expects to have nearly $2.4 million to distribute to select "Next Gen Farmers" during the coming fiscal year (at the time their farms are being purchased).
Essentially, the Next Gen Program allows MARBIDCO to provide a qualified "beginner farmer" (or other, more experienced farmer) with a farm purchase down-payment to help meet the equity requirements of a commercial lender (as a bank would be making a mortgage loan towards assisting with the farm purchase too). A "beginner farmer" is someone who has not operated a farm or ranch for more than 10 years, has at least one year of farming experience or has completed a qualified farm management-training program that includes substantial fieldwork experience, and expects to substantially participate in the farm operation on the subject property.
Through the Next Gen Program, MARBIDCO will pay up to 51% of the Fair Market Value (FMV) of the agricultural land only (with a cap of $500,000) with these funds being provided as a down-payment at a real estate settlement. The Next Gen Farmer will then have a period of several years to sell the permanent conservation easement on the farmland to a rural land conservation program (thus extinguishing the development rights on the property forever). If the Next Gen Farmer cannot sell the permanent easement within the specified timeframe, the option will be exercised (for no additional money) to grant the easement to the "default easement holder" (either the county agricultural land preservation program, or a farmland conservation program selected by MARBIDCO at the end of the option period).
The deadline for complete Next Gen Program applications to be submitted to MARBIDCO is August 31, 2017.
In addition, it is advisable that all prospective Next Gen applicants should have the following items in process during the month of July 2017:
- A contract of sale for the subject farm property is negotiated and ratified.
Note: It is recommended that these purchase contracts not expire before the end of February 2018, and that there be a provision for the return of an earnest money down-payment to the beginner farmer in the event that NGFAP funding is not approved. It is also suggested that these contracts specify whether the buyer and/or the seller will be responsible for paying the costs of the required land property survey, as well as other closing costs.]
- Be in contact with their respective county agricultural land preservation administrator or designee to discuss the subject farm property (as this individual will play an important role in the application process).
- Have a written farm business plan developed.
A Next Gen Farmer will also need to seek the participation of a commercial bank or Farm Credit Association to provide a portion of the farm purchase financing, but a firm bank loan commitment is not needed by the August 31st application deadline. Rather, the Next Gen Farmer will have a short window of time after being notified of approval, to arrange for commercial lender financing and submit a loan commitment letter to MARBIDCO.
Further information about the Next Gen Program may be obtained by contacting Allison Roe, Financial Programs Associate, at (410) 267-6807, or email@example.com
July 31, 2017: Deadline for Next Gen Program applicants to contact their respective County Agricultural Land Preservation staff.
August 31, 2017: Submission deadline for Next Gen Program applications by no later than 4:00 pm in the MARBIDCO office in Annapolis (or postmarked by August 29, 2017).
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(July 1, 2017)