Organic Dairy Transition Loan Program
Montpelier, VT - The Vermont Agricultural Credit Corporation (VACC), a subsidiary of the Vermont Economic Development Authority (VEDA), and the Vermont Agency of Agriculture, Food and Markets (VAAFM) are announcing a new program to make deferred payment loans to eligible dairy farmers transitioning to organic milk production. The Organic Transition Program will provide loans to offset costs of transitioning to organic dairy production and allow farmers to begin repayment after achieving organic certification, at which time they will receive an enhanced price for organic milk.
"The transition to organic dairy production requires farmers to change production practices, and the costs involved in making those changes can sometimes be a limiting factor to dairy farmers looking to earn an enhanced price for organic milk," said Agency of Agriculture, Food and Markets Secretary Stephen Kerr. "This program was designed to help farmers make that transition successfully."
Through the Dairy Summit held in June of 2006, Governor Douglas and the Vermont General Assembly provided $100,000 to the Vermont Agency of Agriculture, Food and Markets to pay loan interest for the Organic Transition Program, and the Vermont Agricultural Credit Corporation has committed up to $1 million in financing for the program. In an effort to assist as many transitioning organic dairies as possible, individual loan amounts will be capped at $20,000.
In order to be certified organic, land that provides feed for the animals must be free of herbicides, pesticides and chemical fertilizer for three years and the animals must be managed organically for 12 months prior to certification. The Organic Transition Program is designed to assist farmers with eligible costs specifically incurred within the last 12 months of the organic transition.
"Farmers face many expenses within the last 12 months of organic transition," said VEDA's Chief Executive Officer Jo Bradley. "Increased feed costs, investments in fencing, barnyards, or remodeling the barn are all eligible expenses for transitioning dairy farmers." The Organic Transition Program will provide loans to meet these and other costs, and will not require repayment until after organic certification has been obtained. Loans will be made to eligible borrowers on a first come, first served basis and must be repaid within 62 months of the date of certification of organic milk production. Eligible borrowers must be operating a dairy farm in its last year of transition to organic dairy production.
For more information about the Organic Transition Program and the application process, please contact Diane Bothfeld at the Vermont Agency of Agriculture at 828-3835, or Sarah Isham at the Vermont Agricultural Credit Corporation at 828-5627.