LANSING – Legislation to help provide financial relief for Michigan’s fruit farmers, who were devastated by this winter’s early thaw and subsequent frost, was sent to the governor on Thursday to be signed, said Sen. Darwin Booher.
“The unprecedented disaster in the wake of unusual weather this spring has put most Michigan fruit growers in a state of emergency,” said Booher, R-Evart. “Thankfully, help is on the way.”
House Bill 5717, sponsored by Rep. Ray Franz, R-Onekama, creates the Agriculture Loan Origination Program to provide financial relief in the form of low-interest loans of up to $1 million to farmers with significant weather-related crop losses. It is similar to the 2002 Michigan Farm Disaster Relief Program that has since sunsetted.
“An April frost wiped out up to 90 percent of Michigan’s tart cherry crop and 80 percent of the apple crop, and the losses to our farmers statewide could top $200 million,” Booher said. “Our farmers are proud and responsible people. This is not a handout and our farmers have not asked for one. This is a helping hand to help them financially recover from a disaster.”
According to industry analysts, for apples, blueberries, grapes, peaches, asparagus and both sweet and tart cherries the estimated loss this year is 58 percent of the 2006-2010 average, or $209.8 million. As a result of the crop loss, the level of output of goods and services in Michigan is expected to decline by about $503 million compared to the 2006-2010 average.
Under the program, growers, processors and agri-businesses with documented losses would be eligible for one percent interest, five-year loans with the first principle payment not required until the end of the loan’s 24th month. The loans would be privately administered with private funds. The state would only provide partial reimbursement of loan origination costs equal to five percent of the loan’s original principal and would make payments over a five-year period.
“The most pressing need is for financial support to growers to help maintain their fruit vines and trees, so that they don’t lose next season’s crop as well,” Booher said. “The Senate and the governor have requested federal disaster assistance, but that aid will not come soon enough to help growers and processors this growing season.
“For a maximum of $15 million during the next five years, the state can help meet the needs of our fruit growers and support more than $500 million in annual economic activity.”