Pennsylvania Farm Bureau is urging members of the state’s General Assembly to support legislation that would provide a tax credit for landowners who sell or lease land to “beginning farmers.”

Senate Bill 478 would provide selling landowners with a one-time tax credit totaling 5% of the sales price with a maximum credit of $32,000, or a 10% credit on the gross rental price with a maximum credit of $7,000 per year. Any landowner who rents property to a qualified beginning farmer would be eligible for the tax credit for a maximum of three years.  

“Over and over we hear from young farmers who are hindered from establishing their own businesses due to the lack of affordable land to buy or rent,” said Rick Ebert, president of Pennsylvania Farm Bureau, during a recent press conference in Harrisburg, Pa. “We are hopeful that the legislation will reduce some of those roadblocks and pave the way for a better future for young people who have a passion for growing food to meet the needs of consumers.”

Sen. Elder Vogel, chairman of the Senate Agriculture and Rural Affairs Committee and prime sponsor of the bill, says there are specific criteria defining who can qualify as a beginning farmer, including the exclusion of individuals who have engaged in farming for 10 years or longer.

The bill also states that selling or leasing land to a family member would not be eligible for the tax credit and that beginning farmers can’t have a net worth of more than $800,000.

The bill allocates $5 million for the program in the first year and $6 million a year in the second and subsequent years. The tax credits will be doled out on a first come, first serve basis.

New opportunities

At the press conference, Dauphin County hay farmer Tyler Shaw talked about the potential benefits of the legislation.

“The tax credit should provide more opportunities for me to rent land, help me solidify existing rental agreements and potentially allow me to enter into more favorable three-year lease agreements,” Shaw said. “Ultimately, I hope it creates an opportunity for me to be able to purchase my own land.”      

The National Young Farmers Coalition says similar legislation has been enacted in Minnesota following a successful campaign by the Central Minnesota Young Farmers Coalition in 2017.

"Beginning Pennsylvania farmers are struggling to access affordable farmland. High farmland prices, development pressure and a lack of transparent land markets all contribute to this major barrier for young farmers hoping to build successful farming careers,” says David Howard, Northeast campaigns director for the National Young Farmers Coalition. “This policy approach of providing incentives to landowners has proven successful in Minnesota, where a similar program facilitated more than 400 transactions between asset owners and beginning farmers. We applaud Sen. Elder Vogel Jr. for his leadership on this important issue and look forward to helping pass and enact the legislation.” 

Source: Pennsylvania Farm Bureau, which is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset.