Financial Opportunities for Acreage Owners Mindy Hubert [email protected]...
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Transcript of Financial Opportunities for Acreage Owners Mindy Hubert [email protected]...
![Page 2: Financial Opportunities for Acreage Owners Mindy Hubert mindy.hubert@sdstate.edu mindy.hubert@sdstate.edu.](https://reader035.fdocuments.in/reader035/viewer/2022070307/551b7ad3550346a10a8b4e63/html5/thumbnails/2.jpg)
Income Opportunities
• Ag Status (tax savings)• Grants• Other programs
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Benefit of “Ag Status”• Can help lower property taxes,
sometimes very significantly
– Depends on your county tax levy – Example:
$14 tax/$1000 assessed for ag landvs.
$16 tax /1000 assessed value for non-ag
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Benefit of “Ag Status”• More significantly, depends on
how your property is assessed:– Non-ag (owner-occupied) vs. ag
property
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Benefit of “Ag Status”• Non-ag property is assessed at
market value
• Ag property is assessed based on a productivity formula– Almost always significantly less than
Market Value• most notable on properties valued
high (Black Hills)
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ExamplePropertyDescription
Assessment Tax
Wall or Black Hills,100ac
ag land @ $200/ac $200*100ac=$20,000*.014 (levy rate)=$280
Wall, 100ac non-ag @ $1000/ac
$1000*100ac=$100,000 *.016 (levy rate) =$1600
Black Hills, 100ac non-ag @ $5000/ac
$5000*100ac=$500,000 *.016 (levy rate) =$8000
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Qualifying for Ag Status
• SDCL 10-6-31.3• Two of three following criteria
must be met:1. (State Requirement) Minimum of
20 acres owned• Counties can require up to
160 total acres
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Minimum Acreage SizeCounty Minimum Size
(ac)
Butte 145
Lawrence 41
Pennington 40
Meade 73
Custer 40
Fall River 160
Harding 160
Jackson 70
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Criteria-continued2. 33.3% of total family gross income is ag3. Acreage is devoted to:
• Raising crops, timber or fruit trees
• Rearing, feeding, and management of farm livestock, poultry, fish, or nursery stock
• Production of bees and apiary products, or horticulture
• Horses generally not considered Ag (thought of as a tool to conduct ranch work)…like a ranch truck or border collie
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Criteria• Hobby Ag vs. Production Ag:
o Principal use of the property is ag production with “Intent to produce income”
o A 40 acre property with a home, garage, and 20 sheep does not meet this criteria.
o A 40 acre property with a home, garage, and 200 head feedlot does.
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Directors of Equalization: http://www.sdcounties.org/
Shannon Rittberger, [email protected] 505 Kansas City StreetRapid City, SD 57701(605) 394-2175
Kirk Chaffee, Meade [email protected] Sherman St., Suite 222 Sturgis, SD 57785(605) 347-3818
Allison Jensen, [email protected] Mt Rushmore RdCuster, SD 57730 (605) 673-8170
Polly Odle, Butte [email protected] 5th Ave.Belle Fourche, SD 57717(605) 892-3950
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Directors of Equalization Terri Halls, Fall [email protected] N. River St.Hot Springs, SD 57747(605) 745-5136
Tim Hodson, [email protected] 90 Sherman StreetDeadwood, SD 57732(605)-578-3680
Kyle Helseth, [email protected] N. Dakota Ave.Sioux Falls, SD 57104(605) 367-4228
Directors of Equalization: http://www.sdcounties.org/
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May Help Qualify for Ag Status (Pennington, Fall River, Custer)
• Tree Farm System http://www.treefarmsystem.org• 105 certified American Tree Farms in SD• Must have an approved Management Plan for property Inspections every 5 years• Can help prove Principal Use of acreage is Timber
• John Hinners, [email protected] South Dakota Department of AgricultureP.O. Box 940Huron, SD 57350-0940
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Grant Opportunities for Acreage Owners
• Ag-related grants generally fund:o Sustainability projects (water, land, etc.)o Income-based operationso Demonstrations/feasibility studieso Outreach/Education projectso Marketing Strategies
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Federal Grants
• Primary source of most grants
• Very competitive
• Specific goals or priorities you need to address
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Federal Grants: USDA SARE
o SARE “Sustainable Agriculture Research &
Education”
o http://www.northcentralsare.org/GRANTS
o Four Programs:
o Research & Education
o Professional Development
o Youth/Educator
o Farmer/Rancher Grants
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Federal Grants: USDA Rural Develop.
• Value-Added Producer Grants (VAPG)
• http://www.rurdev.usda.gov/rbs/coops/vadg.htm
o Eligible: independent producers, farmer/rancher
cooperatives & producer groups & businesses
o Funds:o Planning grant ($100,000)o Working capital ($300,000)
o Belle Fourche: Jackson Winery and Vineyards, LLC $300,000
o Rapid City: Wild Idea Buffalo Company $17,500
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Federal Grants: USDA Rural Develop.
• Rural Energy for America Program (REAP) • http://www.rurdev.usda.gov/BCP_Reap.html
o Financial assistance to agriculture producers & rural small businesses for purchasing, installing and constructing renewable energy systems (windmills, etc.)
o An agricultural producer is directly engaged in the production of agricultural products whereby 50 percent or greater of their gross income is derived from the operations.
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Federal Grants: USDA Rural Development • Rural Energy for America Program (REAP)
o Grants available up to 25% of total project cost up to $500,000
o Loan Guarantees up to 75% total project cost of
$2500-$25M
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Natural Resource Conservation Service (NRCS)
• Various conservation programs offered
• Signup is continuous for many programs
• Limited resource farmers/ranchers, beginning farmers/ranchers, socially disadvantaged producers, and Tribes may be eligible for a higher payment rates
• No acreage limits for most programs; preference given to largest impact producers
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Natural Resource Conservation Service (NRCS)
• 2011: 3,700 conservation plans implemented in SD; positively affecting 1.6 million acres (430 acres on average)
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State Grants• Dept. of Ag: http://
www.sdda.sd.gov/AgPolicy/Grants o Specialty Crop Block Grant (SCBG)
o Purpose: solely enhance the competitiveness of specialty crops (fruits, vegetables, tree nuts, dried fruits, horticulture, and nursery crops [including floriculture]).“
o Due April 2nd 2012o Range of awards $2100-$35,000
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Private Industry Grant Links
• https://attra.ncat.org/calendar/funding.php• http://www.beginningfarmers.org/• http://aggrantguru.blogspot.com/• http://ofrf.org/
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Producer Participation Opportunities:• Spring Creek Watershed Partnership
o For landowners in the Upper Spring Creek Watershed (above Sheridan Lake)
o Cost share opportunity to improve water resourceso http://www.springcreekblackhills.com
• Belle Fourche River Watershed Partnershipo funding available to convert flood irrigation to center
pivots and to convert open ditches to pipelines in flood irrigation systems.
o http://www.bellefourchewatershed.org/o Contact local NRCS office for more info
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Links from this Training• www.sdstate.edu/wrac/sdsa– Real estate tab• ACRE exam• Upcoming Continuing Education events• Presentations posted from training
• www.iGrow.org– ACRE designees listed– Extension Field Staff– Livestock & Small acreage tabs
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Links from this Training• SDSU Regional Extension Center– 605-394-1722
• Denise Miller, GIS SpecialistNRCS - Rapid City FSO605.343.1643 ext. 134