The Tennessee Department of Agriculture is seeking an additional $20 million to support farm cost-sharing and economic development programs in 2025.
Tennessee’s agriculture department is seeking $20 million to boost farm support programs as one of the state’s biggest industries faces a historic drop in net farm income.
The department requested $15 million for the Agricultural Enterprise Fund, which supports agricultural job creation and economic development, and $5 million for the Tennessee Agricultural Enhancement Program, which offers cost-sharing for producers making long-term farm investments.
While Tennessee has made hundreds of millions of dollars in investments in agriculture and forestry, the industries face “pretty strong headwinds,” Commissioner Charlie Hatcher said during a budget proposal presentation to Gov. Bill Lee Tuesday.
Nationwide, farms are expected to see a $10.2 billion decrease in net farm income in 2024, following a drop in 2023 of $43.3 billion, according to the U.S. Department of Agriculture. In Tennessee, weather events including the recent flood in Northeast Tennessee and severe drought in some counties add pressure to an industry already burdened by inflation. The state has lost 432,000 acres of farmland since 2017, according to the department.
The $20 million ask is part of a requested $54.5 million budget increase. Other items on the wishlist include $30 million for a new Tennessee Center for Agriculture and Forestry in Wilson County, $3 million for fairgrounds improvements and $1 million for state forest upkeep.
Tennessee Agricultural Enhancement Program
Tennessee has poured $267 million into tens of thousands of projects in what Assistant Commissioner for Business Development Andy Holt considers the state’s “flagship cost share program” since its 2005 launch.
“What we’ve recognized is that the 7,600 applicants that we’ve had so far are representative of each and every county in the state of Tennessee. We think that it’s had a great amount of impact,” Holt said.
The program offers a 50% cost share with specific limits based on the type of project proposed.
The program’s current recurring budget is $26.5 million, but as costs rise and more producers are interested in assistance, the department is faced with a choice: decrease the reimbursement maximums, or turn people away.
“We don’t necessarily think that’s the way to approach it, because we think that agriculture is present in all these counties, and whether you’re a larger producer or a very small producer, you’re still a valuable part of the food and fiber network,” Holt said.
The department created a separate application for a dozen counties impacted by flooding this year, and has already seen 1,259 applications from those areas.
Agricultural Enterprise Fund
Where the state’s Agricultural Enhancement Program focuses on singular impacts to singular operations, the newer Agricultural Enterprise Fund shores up larger-scale projects that produce jobs.
The program launched in 2018 as a recommendation from the state’s rural Taskforce. It supported 281 projects from 2019 through 2023, 34% of which were in distressed or at-risk counties.
“This fund allows us to retain and recruit (agriculture) and forestry business, and we’ve never had that capability before,” Holt said. “It may be the single best program we have for economic development for (agriculture) and forestry.”
Projects supported by the program may not be eligible for consideration by the state’s Department of Economic and Community Development, Holt said, because projects may not meet the threshold for volume of new jobs.
In a rural county, a dozen new jobs is significant, Hatcher said.
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