Sections

Weather Forecast

Close
Advertisement

USDA loan repayment program providing needed veterinarian services

Email

WILLMAR — The U.S. Department of Agriculture recently announced that it was awarding more than $4.6 million to 47 individuals to help repay a portion of their veterinary school loans in return for serving areas in the United States lacking sufficient veterinary resources. The awards are being provided under USDA’s Veterinary Medicine Loan Repayment Program, which is administered by the National Institute of Food and Agriculture.

Advertisement

By Wes Nelson

FSA executive director in Kandiyohi County

WILLMAR — The U.S. Department of Agriculture recently announced that it was awarding more than $4.6 million to 47 individuals to help repay a portion of their veterinary school loans in return for serving areas in the United States lacking sufficient veterinary resources. The awards are being provided under USDA’s Veterinary Medicine Loan Repayment Program, which is administered by the National Institute of Food and Agriculture.

The 47 loan repayment recipients will provide veterinarian services for underserved areas in 30 different states. Texas will fill four shortage areas, while Iowa, Minnesota, Montana, Oklahoma and South Dakota will each fill three shortage areas.

During the 2012 fiscal year, a total of 139 applications were received. The average award amount, which includes loan and tax payments, was $98,105, with 85 percent of the recipients receiving the maximum payment of $25,000 per year. In return, all award recipients are required to commit to three years of veterinary service in a designated veterinary shortage area.

Loan repayment benefits are limited to payments of the principal and interest on government and commercial loans received for attending an American Veterinary Medical Association-accredited college of veterinary medicine, resulting in a degree of Doctor of Veterinary Medicine or equivalent.

Since loan repayments are considered taxable income, included in the award is a federal tax payment equal to 39 percent of the loan payment. This amount is made directly to the award recipient’s IRS tax account to offset the increase in income tax liability.

Veterinarians are critical to America’s food safety and food security, plus the overall health and well-being of both animals and humans. Major studies indicate significant and growing shortages of food supply veterinarians, and veterinarians serving in certain other high-priority specialty areas.

An identified leading cause for the veterinarian shortages is the cost of completing four years of professional veterinary medical training, which according to the latest American Veterinary Medical Association survey can average more than $150,000.

USDA’s Farm Service Agency can assist farmers needing financial assistance

Spring planting may be several months away, but farmers are already making preparations for the 2013 growing season. Part of those preparations may include putting together a financial plan with a lender.

Farming today is much like operating a business in town. Profit margins can be small; large sums of money are often invested in machinery, facilities and labor; competition is fierce; and effective management of assets and capital can be critical to the success or failure of the farming operation.

Many farmers today may borrow $200,000 to $500,000 or more to cover their annual short-term crop and livestock expenses.

Input costs for farmers have risen dramatically in recent years, much of which is directly or indirectly the result of the increased cost of land, machinery and energy. And because of higher input costs, farmers may need additional capital to cover their annual operating expenses.

Farmers who are unable to obtain adequate private or commercial credit for farming purposes should remember that local Farm Service Agency offices offer several lending programs that may assist farmers with their financing needs. In addition, the agency will provide free supervised credit counseling for farmers that qualify for financing.

Local Farm Service Agency offices have funds for direct or guaranteed operating loans. The agency also reserves funds that are specifically devoted to beginning farmers, minorities and women.

The interest rates on loans are typically lower than commercial rates. However, the agency does not intend to take business away from private and commercial lenders. Therefore, Farm Service Agency offices will only provide financing to farmers who are unable to obtain private or commercial credit, including loans with commercial lenders that are guaranteed by the agency.

Direct farm operating loans may be used to buy items needed to operate a farm. Those items may include livestock, livestock feed, seed, fuel, chemicals, fertilizer, insurance and other operating expenses.

Direct operating loans can also be used to buy machinery, equipment, breeding livestock, pay for minor building improvements, or to refinance existing debts.

The interest rate on direct loans is a fixed rate that reflects the rate in effect at the time of loan approval or loan closing, whichever is lower. During the month of January, the direct operating loan interest rate is 1.25 percent.

The direct operating loan limit is $300,000. Repayment terms will vary according to loan purposes and the availability of loan security.

Annual operating loans have a one-year term, with up to a seven-year term for breeding livestock and equipment loans.

To qualify for a direct loan, the applicant must have sufficient ability to repay the loan, while also pledging enough collateral to fully secure the loan.

In addition to direct loans, the Farm Service Agency offers several guaranteed loan programs. With a guaranteed loan, the agency can guarantee up to 90 percent of a loan issued by a commercial lender. However, all loans must meet specific eligibility criteria to qualify for the guaranteed loan program.

Free ear tags available

In the interest of preventing disease in domestic animals and improving animal traceability in the event of a disease outbreak, the Minnesota Board of Animal Health is now offering free official ear tags to cattle, bison and farmed cervidae producers.

To order your free official ear tags and livestock inventory worksheets, call the Minnesota Board of Animal Health at 651-296-2942.

Wes Nelson is executive director of the USDA Farm Service Agency in Kandiyohi County.

Advertisement
Advertisement
Advertisement