II 

118TH CONGRESS 

2D SESSION S. 4441 

To amend the Consolidated Farm and Rural Development Act to provide 

for a pilot program under which development loans and loan guarantees 

may be made to beginning farmers and ranchers, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 3, 2024 

Mr. WELCH introduced the following bill; which was read twice and referred 

to the Committee on Agriculture, Nutrition, and Forestry 

A BILL 

To amend the Consolidated Farm and Rural Development 

Act to provide for a pilot program under which development loans and loan guarantees may be made to beginning farmers and ranchers, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Capital for Beginning 

5 Farmers and Ranchers Act of 2024’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds that— 


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1 (1) beginning farmers and ranchers often pur2 sue business models featuring diverse and specialized 

3 production and marketing strategies; 

4 (2) diverse and specialized agricultural busi5 nesses typically require substantial early-stage in6 vestments which will benefit the operation for years 

7 to come; and 

8 (3) programs in effect as of 2024 often finance 

9 those multi-year investments as annual operating 

10 loans, resulting in beginning farmers and ranchers 

11 under-investing in critical start-up capacities, lim12 iting the ability of beginning farmers and ranchers 

13 to accumulate working capital, and increasing the 

14 difficulties faced by beginning farmers and ranchers 

15 in meeting the terms of those loans. 

16 SEC. 3. BEGINNING FARMER AND RANCHER DEVELOPMENT 

17 LOAN PILOT PROGRAM. 

18 Subtitle B of the Consolidated Farm and Rural De19 velopment Act (7 U.S.C. 1941 et seq.) is amended by add20 ing at the end the following: 

21 ‘‘SEC. 320. BEGINNING FARMER AND RANCHER DEVELOP22 MENT LOAN PILOT PROGRAM. 

23 ‘‘(a) DEFINITION OF DEVELOPMENT EXPENDI24 TURE.— 


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1 ‘‘(1) IN GENERAL.—In this section, the term 

2 ‘development expenditure’ means a capital invest3 ment that benefits a farming or ranching business of 

4 a qualified beginning farmer or rancher for more 

5 than 1 year. 

6 ‘‘(2) INCLUSIONS.—In this section, the term 

7 ‘development expenditure’ includes an expenditure— 

8 ‘‘(A) for the acquisition or development 

9 of— 

10 ‘‘(i) initial assets; or 

11 ‘‘(ii) intangible infrastructure; 

12 ‘‘(B) to increase long-term soil fertility, es13 tablish perennials, or develop breeding stock; 

14 ‘‘(C) to establish an appropriate founda15 tion of small equipment, tools, or supplies; 

16 ‘‘(D) to develop branding and reputation, 

17 establish commercial relationships with sup18 pliers and key service providers, access new 

19 markets, or refine product offerings; 

20 ‘‘(E) to establish a bookkeeping system 

21 sufficient to support invoicing multiple clients 

22 and managing profitability with respect to di23 verse crops and livestock; 

24 ‘‘(F) to establish payroll and implement le25 gally compliant labor practices; 


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1 ‘‘(G) to establish other business manage2 ment practices relating to food safety, environ3 mental, or other regulatory compliance; or 

4 ‘‘(H) for such other items as the Secretary 

5 determines appropriate. 

6 ‘‘(b) ESTABLISHMENT.—Not later than 2 years after 

7 the date of enactment of this section, the Secretary shall 

8 establish a pilot program to make or guarantee develop9 ment loans to qualified beginning farmers and ranchers 

10 to finance development expenditures. 

11 ‘‘(c) TERMS AND CONDITIONS.— 

12 ‘‘(1) IN GENERAL.—Notwithstanding any other 

13 provision of law, a development loan made or guar14 anteed under this section— 

15 ‘‘(A) shall have a repayment term of— 

16 ‘‘(i) not less than 3 years; and 

17 ‘‘(ii) not more than 10 years; 

18 ‘‘(B) may be used only to cover develop19 ment expenditures; 

20 ‘‘(C) shall not exceed $100,000; 

21 ‘‘(D) shall have a collateral requirement of 

22 not more than 100 percent loan-to-value, sub23 ject to paragraph (2); 

24 ‘‘(E) shall have an interest rate, deter25 mined by the Secretary, of— 


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1 ‘‘(i) not less than zero percent; and 

2 ‘‘(ii) not more than 3 percent; 

3 ‘‘(F) shall require the participating quali4 fied beginning farmer or rancher to make an5 nual interest payments for the full amount of 

6 interest due; and 

7 ‘‘(G) shall include flexible principal repay8 ment, subject to the condition that not less 

9 than 1 percent of the remaining balance shall 

10 be due annually on a date determined by the 

11 Secretary. 

12 ‘‘(2) COLLATERAL REQUIREMENT.—The collat13 eral requirement described in paragraph (1)(D) may 

14 be reduced by the lender based on the farming or 

15 ranching experience and expertise of the borrower. 

16 ‘‘(3) TREATMENT.—A development loan made 

17 or guaranteed under this section— 

18 ‘‘(A) shall not count toward the limitations 

19 described in subparagraphs (B) and (C) of sec20 tion 311(c)(1); 

21 ‘‘(B) shall be considered to be— 

22 ‘‘(i) a direct operating loan or a guar23 anteed operating loan, as applicable, for 

24 purposes of section 346(b)(2); and 


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1 ‘‘(ii) an operating loan under section 

2 312 for purposes of section 343(a)(10); 

3 and 

4 ‘‘(C) except as otherwise provided in this 

5 section, shall be subject to all applicable provi6 sions of law relating to, as applicable— 

7 ‘‘(i) direct operating loans under this 

8 title; 

9 ‘‘(ii) guaranteed operating loans 

10 under this title; or 

11 ‘‘(iii) farmer program loans. 

12 ‘‘(d) BORROWER TRAINING.— 

13 ‘‘(1) IN GENERAL.—The Secretary shall provide 

14 to borrowers of development loans made or guaran15 teed under this section comprehensive training and 

16 support addressing farm and ranch management 

17 issues. 

18 ‘‘(2) REQUIREMENTS.—The training and sup19 port provided under paragraph (1) shall address, to 

20 the maximum extent practicable— 

21 ‘‘(A) bookkeeping, taxation, credit, and 

22 regulatory compliance; and 

23 ‘‘(B) cash flow, profitability, and risk man24 agement. 


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1 ‘‘(3) PROVISION.—The Secretary shall provide 

2 training and support under paragraph (1) through— 

3 ‘‘(A) entities with which the Secretary has 

4 entered into a contract under section 359; 

5 ‘‘(B) entities that receive funding through 

6 the beginning farmer and rancher development 

7 grant program established under section 

8 2501(d) of the Food, Agriculture, Conservation, 

9 and Trade Act of 1990 (7 U.S.C. 2279(d)); 

10 ‘‘(C) entities that receive funding through 

11 the risk management education program estab12 lished under section 524(a)(2) of the Federal 

13 Crop Insurance Act (7 U.S.C. 1524(a)(2)); or 

14 ‘‘(D) other relevant programs, as deter15 mined by the Secretary, including qualified pro16 grams that request such a determination. 

17 ‘‘(e) EVALUATION AND REPORTS.—The Secretary 

18 shall— 

19 ‘‘(1) evaluate the pilot program established 

20 under subsection (b) on an ongoing basis; and 

21 ‘‘(2) biennially submit to the Committee on Ag22 riculture, Nutrition, and Forestry of the Senate and 

23 the Committee on Agriculture of the House of RepVerDate Sep 11 2014 21:18 Jul 17, 2024 Jkt 049200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S4441.IS S4441

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1 resentatives a written report describing the oper2 ation and outcomes of the pilot program.’’. 

Æ 


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