TEXAS

Rick Rhodes
Texas Agricultural Finance Authority
PO Box 12847
Austin, TX 78711-2847
Telephone: (512) 936-0273 Toll Free: (877) 428-7848 FAX: (888) 216-9867
E-mail: rick.rhodes@tda.state.tx.us
Website: www.texasagriculture.gov
Organization Began: 1987


Program/Project Title: Agricultural Loan Guarantee Program
Program Began: 2009
Contact Person: Allen Regehr
Cost/Funding: Farm and ranch vehicle tag fees deposited to the Texas Agricultural Fund
Target Group: Agricultural Producers
Description: TAFA provides financial assistance to establish or enhance farming or ranching operations or to establish an agricultural-related business. The program provides loan guarantees based on a tiered structure, not to exceed $750,000 or 70% of the loan amount, whichever is less.  The program also provides an interest rebate up to $5,000 annually, as part of the guarantee process to eligible borrowers.  The proceeds of the commitment may be used to provide working capital, improvements, equipment, or real estate for the farm and/or ranch or agribusiness. Lender determines the Interest rates and are approved by the Authority.

Program/Project Title: Interest Rate Reduction Program
Program Began: 1998
Contact Person:  Allen Regehr
Cost/Funding: The allocation of State of Texas General Revenue by the Texas Legislature of not more than $30 million
Target Group: Ag entities that are: a) processing/marketing ag crops, b) producing alternative crops; c) producing crops which have declined due to a natural disaster; d) producing ag crops using water conservation equipment; and e) development of water conservation projects.
Description: Encourages private commercial lending at below market rates to eligible participants as outlined above. The proceeds of the commitment may be used for any ag-related operating expense, including purchase or lease of land or fixed asset acquisition or improvements. Interest rates are based on matching the loan maturity date to the closest treasury bill/note maturity date or the end of state’s fiscal biennium, typically below current market rates. The lender and borrower determine repayment, maturity, and collateral for the loan. The Interest Rate Reduction Program is an interest buy-down and not a guaranteed loan program.

Program/Project Title: Young Farmer Interest Rate Reduction Program
Program Began: 2009
Contact Person: Allen Regehr
Target Group: Agricultural Producers 18 to < 46 years old
Cost/Funding: TAFA Board allocated $1 million for 2011
Target Group:  Young agricultural producers 18 to less than 46 years of age.

Description: Encourages private commercial lending at below market rates to eligible participants as outlined above. The proceeds of the commitment may be used for any ag-related operating expense, including purchase or lease of land or fixed asset acquisition or improvements. Interest rates are based on matching the loan maturity date to the closest treasury bill/note maturity date or the end of state’s fiscal biennium, typically below current market rates. The lender and borrower determine repayment, maturity, and collateral for the loan.  The final interest rate under the Young Farmer Interest Rate Reduction program may be up to 1% less than the corresponding rate in the Interest Rate Reduction program. The Young Farmer Interest Rate Reduction Program is an interest buy-down and not a guaranteed loan program.

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