Local small and mid-size local farms may now benefit from two initiatives just recently announced by the U.S. Department of Agriculture.

The USDA has made changes to its Farm Storage Facility Loan program and created Whole Farm Diversified Risk Management revenue insurance. The National Sustainable Agricultural Coalition lobbied for both benefits.

Changes to the FSFL loan program will help fruit and vegetable growers qualify for loans to build storage sheds. The program has also expanded to cover financing for packing and washing sheds where farmers wash, sort, grade, label, box and store fresh produce before bringing it to market.

Previously, any loan over $50,000 required the producer to provide additional security, such as a lien on the property where the facility would be located. Moreover, the value of the property had to at least equal the amount of the loan and the producer had to provide either a severance agreement from any prior lien-holders or other ways to secure the loan, such as a larger down payment.

For many small and beginning farmers, these requirements discouraged applications because of the time and money required to obtain a relatively small loan. Under the new rule, the requirement for additional security does not apply unless the loan exceeds $100,000. These changes, in addition to the changes for diversified growers, should make it easier for beginning farmers to access lines of credit.

Also, the new 2014 farm bill authorizes USDA to develop whole farm revenue insurance for highly diversified farms. This product will be available nationwide and include a strong diversification bonus.

The new insurance will cover expenses such as the incidental processing activities that occur soon after harvest – packing, packaging, washing, sorting and other activities – all essential to producing a marketable crop.