Farm bills seek to steer younger Arkansans into agriculture

by Ronak Patel ([email protected]) 2,427 views 

Rep. Julie Mayberry, R-Hensley, and Rep. Denise Garner, D-Fayetteville, have introduced a bill aimed at addressing the challenges young farmers face entering the profession.

According to House Bill 1003, an income tax credit would be available for farmers who sell or rent agricultural assets to a beginning farmer. Agricultural assets include land, livestock, facilities, buildings and machinery.

In an interview, Mayberry said the bill was sponsored in the previous legislative session by former Rep. Joe Jett, R-Success, but failed to make it out of the House Revenue and Taxation Committee.

“I think most committee members at the time were interested in the bill. They had a few concerns that I went back over to watch the tape to try and address some of those concerns,” Mayberry said.

Brandon Martin, a poultry and cattle farmer in White County, said agriculture is a high capital operation and that makes it difficult to enter the industry. He said young farmers having the ability to lease land can be helpful for young farmers.

“If you have a tax incentive to lease to a young farmer, you’re apt to lease to them than to somebody else or selling to somebody else that’s just going to add to their profile,” Martin said. “It helps young farmers get in and get started.”

According to figures tied to the bill’s fiscal impact statement, the tax credit amount for farmers who rent or sell to beginning farmers are:

  • 5% of the sale price of the agricultural asset;
  • 10% of gross rental income received during first three years of rental agreement;
  • 15% of the cash equivalent of the gross rental income received during first three years of the rental agreement.

Mayberry said the bill was at the top of her list of priorities. She said the lack of young farmers entering the field is concerning.

“If we’re not doing something to help beginning farmers who might not have the bloodline to get started, we’re going to have a crisis. We need to get ahead on that,” Mayberry said.

According to the University of Arkansas, farming is 12.3% of Arkansas’ gross state product, which is the market value of goods and services produced in a state.

Mark Lambert, director of state affairs for the Arkansas Farm Bureau Federation, said 2.5% of farmers are under 25 years old. He said 64% of farmers in Arkansas are over 55 and the average age is about 56 years old.

In addition to challenges getting into the industry, Lauren Martin, a poultry and cattle farmer in White County explained in some areas of farming, it can be difficult for young farmers to take over their family’s farm and have financial stability.

“There’s not enough money in cattle to be able to work on the farm and that’s where a lot of people are losing it. Your parents and grandparents may farm but there’s not enough money to sustain me and my father on the farm, so I would go off and get another job,” Martin said.

She added having to work an outside job and operating a farm can weigh down on families, leading them to sell the farm.

“No matter how small your farm is, it’s full time,” she said.

Mayberry said the bill also includes financial literacy and mentorship programs for young farmers.

“This is true of any line of work. You might know how to do that particular line of work great, but if you don’t know how to handle the finances you’re going to fall apart,” she said.

Beginning farmers who participate in the financial mentorship program can receive a tax credit, which is estimated to be a one-time payment of $1,500 and be redeemed for up to three years.

The tax credit for beginning farmers and the one for farmers renting or selling assets to young farmers is projected to cause a $6.1 million reduction in general revenue in the 2024 fiscal year. For fiscal year 2025 and beyond, it will cost $10 million a year.

There is a cap on the amount of tax credits the state can administer. The income tax credits can’t exceed $10 million a year. Lambert said in Ohio, where a similar tax credit is available, the cap has been raised. Mayberry said going forward, the cap could be raised, if needed.

Mayberry said it will be a challenge to get HB1003 out of the House Revenue and Taxation Committee with possible tax cuts, the LEARNS Act, and sentencing reform expected to have a large fiscal impact on the budget.

Rep. Bruce Cozart, R-Hot Springs, and Sen. Kim Hammer, R-Benton, have introduced legislation that would create an agricultural education pilot program in public elementary schools.

“I think it’s a great bill and it’s going to make Arkansas move forward. We are a farm state, a big farm state, so we’re going to try and keep these kids interested,” Cozart said in an interview with Talk Business & Politics.

According to House Bill 1336, the Division of Elementary and Secondary Education would work with members of the farming industry like the Division of Agriculture and the Arkansas Farm Bureau Federation to create curriculum for agriculture curriculums.

This would take effect during the 2025-2026 school year. The Division of Elementary and Secondary Education would be able to select a minimum of six schools to participate in the pilot program.

Cozart said there currently isn’t an amount available for how much the pilot programs would cost.

“The Farm Bureau is underwriting this, so they’ll take care of the money on this,” he said.

Cozart said the money given to schools for the pilot program would be used to set up the curriculum, along with things like setting up laboratories or horticultures.

Lindsey Rucker, education coordinator for the Arkansas Farm Bureau, said the pilot program would be a way to expose students to agricultural production and practices.

“They’re going to need to feed 9 to 10 billion people by the year 2050. If we’re going to have that many people on less land and less people getting into the farming industry, we’re going to have to educate them and the best way to start is young,” Rucker said.

Rucker explained the program will be in-depth and will teach students about gardening and how food is grown.

Cassie Davis, a parent and dairy farmer, said she would welcome the pilot program because she believes it would be valuable for kids to learn how food is grown.

“I think it’s important for us to know where our food comes from. A lot of times as adults we forget or take for granted where it comes from,” she said.

HB1336 has cleared the Arkansas House and currently awaits action in the Senate Education committee.