HF 650

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to agriculture; providing no-interest loans for dairy farmers to purchase
additional mature dairy cows; proposing coding for new law in Minnesota
Statutes, chapter 41B.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [41B.0455] DAIRY STABILIZATION LOAN PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The authority shall establish, adopt rules for, and
implement a direct, no-interest loan program to assist each Minnesota dairy operator who
applies and is eligible in the acquisition of up to six additional mature dairy cows.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin (a) The definitions in this subdivision apply to this section.
new text end

new text begin (b) "Applicant" means a dairy operator that has applied to the authority for a dairy
stabilization loan.
new text end

new text begin (c) "Borrower" means a dairy operator that has been approved by the authority for a
dairy stabilization loan.
new text end

new text begin (d) "Minnesota dairy operator" or "dairy operator" means an entity that is not
prohibited from owning agricultural land under section 500.24 and that is registered with
the Department of Agriculture as a dairy producer or, if the operator is not currently
a dairy producer, would meet eligibility criteria under section 41B.03, subdivision 3,
paragraph (a), clauses (1), (4), (7), and (8).
new text end

new text begin (e) "Dairy stabilization loan" means a direct loan from the authority to a qualifying
dairy operator in an amount not to exceed $6,000 for purposes of allowing the dairy
operator to purchase up to six mature dairy cows for inclusion in the dairy operator's
farming operation.
new text end

new text begin (f) "Mature dairy cow" or "cow" means a bovine of a breed commonly recognized as
suited for dairying applications that is a bred heifer or is lactating or has been through at
least one lactation cycle.
new text end

new text begin Subd. 3. new text end

new text begin Application forms; procedures; limits. new text end

new text begin (a) Not later than October 1,
2007, the authority shall provide application forms and instructions at dairy processing
facilities and at places reasonably accessible to the public. A printable version of the
forms and instructions may also be made available on an Internet site.
new text end

new text begin (b) An applicant for a no-interest loan must complete the loan application forms and
submit them, along with a written dairy business plan and any additional documentation
required by the authority, to the authority within the eligibility timeline.
new text end

new text begin (c) A loan under this program must be used only for the acquisition of mature dairy
cows. The maximum number of cows that can be financed for any dairy operation or dairy
operator is six, and the maximum amount of financing per cow is $1,000.
new text end

new text begin (d) The maximum term of a loan is six years.
new text end

new text begin (e) No dairy operator is eligible for more than one loan under this program.
new text end

new text begin Subd. 4. new text end

new text begin Review of applications. new text end

new text begin Not later than 30 calendar days after receipt
of a properly completed application for a dairy stabilization loan, the authority must
approve or deny the application. If the loan is approved, the authority must issue a letter of
commitment to the applicant. Within ten business days after the authority receives proof
from the applicant that up to six cows have been purchased, the authority must make
payment to the borrower or a local lender that has provided credit to the borrower on the
basis of the authority's letter of commitment.
new text end

new text begin Subd. 5. new text end

new text begin Repayment of loans. new text end

new text begin (a) A borrower must repay the principal amount of
a dairy stabilization loan not later than six years from the date the loan is issued to the
borrower. The schedule for repayment must be at the option of the borrower and may
include a balloon payment on the sixth anniversary of the loan.
new text end

new text begin (b) If at any time during the term of a loan the borrower no longer qualifies as a
Minnesota dairy operator, the loan immediately becomes payable in full.
new text end