The AG BMP Loan Program
Provides low interest loans to credit-worthy rural landowners farmers and agriculture supply businesses to encourage projects that protect lakes, streams, and groundwater. Loans are used to reduce existing water quality systems, eroding soil, abandoned wells, feedlots, or other pollution hazards.
*Can be combined with government cost share or grants.
WHO MAY APPLY FOR LOANS?
 | Rural landowners |
| Farmers |
| Agriculture Supply Businesses |
WHAT ARE ELIGIBLE ACTIVITIES?
| Repair of individual septic systems |
| Erosion control projects along lake shores, streams, in cropland and forest land |
| Sealing of abandoned wells |
| Feedlot or manure storage improvements |
| Manure handling, spreading, or incorporation equipment improvements |
| Other equipment or facilities to protect water quality from chemical spills, misapplication, or other pollution hazards. |
| Windbreaks to prevent soil erosion |
WHAT ARE INELIGIBLE ACTIVITIES?
| Projects already started |
| Portions of projects dealing with expansion as the loans are for existing problems |
| Improvements for feedlot operations with more than 1000 animal units |
| Activities for operations that have had criminal procedures/legal action brought against them. |
HOW TO APPLY?
The program is locally administered by the Carlton County Soil and Water Conservation District. Applicants must send a letter of request to the District describing the water quality problem, how the loan would be used, and if available, a cost estimate of the project.
Send letter to: Carlton County SWCD, 115 5th Street South, P.O. Box 29, Carlton, MN 55718
WHAT IS THE APPROVAL PROCESS?
District Board reviews the applications to determine if projects meet state eligibility requirements.
Projects that do meet the requirements are sent on the local lender for approval process. The local lender (bank), decides if the applicant meets their lending guidelines for the loan. Projects must meet all federal, state, and local codes as well as Soil and Water Conservation District standards. The lender then approves the loan if the applicant meets the lending guidelines.
COMPARISON OF TYPICAL INTEREST PAID ON 3% AND 9% LOANS FOR 2 TO 10 YEARS
|
YEARS |
LOAN AMOUNT | TOTAL INTEREST PAID AT 3% | TOTAL INTEREST PAID AT 9% | COST SAVINGS |
| 2 | $5,000 | $226 | $685 | $459 |
| 5 | $5,000 | $459 | $1,427 | $968 |
| 10 | $30,000 | $5,169 | $16,746 | $11,577 |
| 10 | $50,000 | $8,615 | $27,910 | $19,295 |
TERMS OF LOANS:
Loan amounts are limited to $50,000 to any one individual or project. "Community" septic systems serving two or more people may receive up to $100,000.
Loans may be amortized over a period of up to 10 years except for conservation tillage practices and individual sewage treatment system projects which may be amortized over 5 years.
The maximum interest rate is 3% plus a one time 1/2% origination fee and other normal and customary charges.
The District and local lender may set additional terms and requirements for eligibility of projects.
These loans may only be used for existing water quality problems.