State Funding / Technical Resources
The Young Farmer Interest Rate Reduction (YFIRR) Program is intended to facilitate a lower interest rate to agricultural producers or agribusiness owners who are between 18 and 46 years of age through a commercial lender. The YFIRR program provides an interest reduction to the borrower on a qualifying bank loan for an eligible project. The Comptroller of Public Accounts for the State of Texas deposts funds in a bank (which must be a state approved depository) at a below market interest rate. The bank issues a loan of like amount, at no more than 4% above the interest rate on the state's deposit. The program does not offer a guaranty or participation by the Authority in the loan.
Program Funding: Program funds are distributed through the Texas Agricultural Fund. A borrower may have more than one linked deposit loan. The total of linked deposit loans to any one borrower cannot exceed $500,000. All linked deposits under this program shall expire upon the expiration of the biennium; however, subject to legislative authorizations and approvals, expired linked deposits may be renewed.
TAFA/TDA assists eligible lenders in acquiring capital through the Texas Comptroller of Public accounts for loans that will be made to agricultural producers or agri-business owners. TAFA reviews project applications to ensure the projects meet TAFA’s requirements, and recommends them to the Comptroller. Upon approval from the Comptroller, the lender is granted capital at a reduced interest rate and passes savings to the borrower.
- Any person who is 18 years of age but younger than 46 years who proposes to use loan proceeds for the creation or expansion of an agricultural business in Texas.
- The applicant should discuss the program with his or her lender and have the lender submit the application.
- Eligible lenders include any financial institution that makes commercial loans and is an approved depository for state funds.
- Farm Credit System lenders are not eligible because they are not able to accept deposits form the Comptroller of Public Accounts.
- The lender and the borrower determine the repayment, maturity and collateral for the loan.
Loan proceeds may be used for any agriculture-related operating expense, including:
- The purchase or lease of land;
- Fixed asset acquisition or improvement; and/or
- Any enterprise based on agriculture, as identified in the application.
- A loan under this program may be applied to existing debt only when required by the lender to finance the expansion of an eligible project.
|Young Farmer Interest Rate Reduction Program|
1700 N. Congress Avenue
Austin, TX 78701
Phone: (512) 463-6908
Fax: (888) 223-8861
To request additions or corrections to this entry email the Administrator