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MDA seeks $20 million for Rural Finance Authority

The Minnesota Department of Agriculture (MDA) is requesting $20 million in state bonding to fund low interest farmer loans through the Rural Finance Authority (RFA).

MDA commissioner Dave Frederickson says the RFA program was created by the legislature during the 1980’s farm crisis.

“It certainly was a lifeline for those trying to meet the demands of paying off debt in the early 80’s by restructuring outstanding loans.  And that continues to be the case today.”

During a conference call Thursday, Frederickson talked about an increase in Minnesota farmers seeking loans through the RFA.

He says the program has evolved, now partnering with more than 400 community banks, as well as members of the farm credit system and Farm Service Agency.

“Farmer borrowing funds through the RFA pay a lower interest rate than they would otherwise, somewhere in the area of between 3 and 3 1/2 percent.  Since 1986 over 3,000 loans have been issued under the program for nearly $249 million dollars.”

Frederickson says RFA has exhausted $25 million of the $35 million appropriated by the legislature in 2017, and Governor Dayton supports the $20 million dollar ask in this year’s bonding bill.