July 27, 2021
According to HB 95 legislation text: “The purpose of this act is to help the next generation enter agriculture by removing some of the existing barriers to entry and exit. The current tax code structure incentivizes farmers to hold onto their land until the time of death. The change proposed by this act will more readily allow succession to occur during the lifetime of a farmer, allowing beginning farmers to acquire assets sooner.” The bill, sponsored primarily by Susan Manchester of Ohio’s 84th District and Mary Lightbody from District 19, was created in the hopes of easing and encouraging the transition of land, equipment and other real property from aging farmers to the ownership of new, emerging farmers.
The agricultural industry continues to become an increasingly difficult one to earn a sustainable living from. According to the USDA, U.S. Dairy Farm numbers continue to decline year after year. A 2021 Milk Production Report confirms that statistic, citing a year-over-year decline in the number of dairy operations and a long trend of farmers deciding to exit the dairy business. Since 2003, the U.S. has lost more than half of its licensed dairy operations, now just shy of 32,000 dairy operations.
State legislators, particularly those from Ohio’s agricultural regions, have come up with a bill that they hope will help increase new farming endeavors throughout our state. In addition to easing some of the strict regulations that often prevent smooth transfer of property among retiring and new farmers, the bill provides tax credits for farmers who meet certain criteria. In order to qualify for these tax incentives, farmers must be new to the industry (by either newly seeking entry or having entered within the last 10-years), they must farm land in the state of Ohio, not be a partner or trustee of any assets they are seeking to buy or rent, have a total net worth of less than $800,000 in 2021, provide the majority of the labor on the farm, and satisfy several other requirements as are defined in the legislation. To learn more about the bill or to read it for yourself, you can visit the Ohio Legislature website.
While all of this sounds like a great benefit to farmers, some feel as though the bill could be better. A recent article in The Daily Record featured an Ashland-area couple who began farming in 2015. While they are grateful for any help they can get when it comes to sustaining their farm, they explain that it has been family support that has helped them more than anything thus far. The article goes on to say that HB 95 may be well-intentioned, but it is weak and is unlikely to provide farmers with the financial help nor the educational guidance they need to successfully run a farm.
Agricultural cooperatives such as Centerra Co-Op offer help to farmers in the form of low-interest loans, education, equipment training and rental, expertise, buying power and even manpower. If you’re interested in becoming a member of Centerra’s cooperative community, call Andrea Jenkins at 419-207-3661.