Numerous federal and state programs exist to help farmers, ranchers, communities, and businesses that have been hard hit by natural disasters, such as a severe drought. Below is a non-exhaustive list of federal and state resources that can help agricultural producers recover. To learn about which federal assistance programs might be right for you, please visit the USDA Disaster Assistance Discovery Tool.
State Ag Disaster Assistance Programs
Disaster Recovery Loan Program
Zero-interest loans are available to Minnesota farmers whose operations are suffering due to extreme drought conditions under the Minnesota Department of Agriculture Disaster Recovery Loan Program. This loan is available to help cover lost revenue or expenses not covered by insurance. The funds can be used for to help clean up, repair, or replace farm buildings, repair or replace septic and water systems, replace seed, fertilizer (or other cropping inputs), feed, or livestock and poultry. Applicants will work through local lenders to apply for the Disaster Recovery Loan Program. Upon completion of an application, the lender will apply for RFA participation. (The RFA must have a completed Master Participation Agreement with the lender on file). Eligible farmers must have received at least 50% of their annual gross income from farming for the past three years. Interest rates on the Rural Finance Authority portion of the loan are currently set at 0.0%.
Federal Ag Disaster Assistance Programs
Numerous federal assistance programs are designed to address agricultural losses following natural disasters, including drought. The U.S. Department of Agriculture (USDA) administers these programs, which include subsidized insurance, direct payments for loss, loans, and cost share to rehabilitate damaged lands. The programs have permanent authorization and are intended to assist producers recovering from production, financial, and physical loss related to or caused by natural disasters. Each program has a different administrative process for producers requesting assistance. The USDA Disaster Assistance Discovery Tool can assist individuals in learning which USDA assistance programs might be right for them.
Some USDA programs provide payments to cover production losses above normal mortality. Advance sign-up is not required. However, application deadlines exist following a qualified loss. These programs are permanently authorized and receive mandatory funding amounts of "such sums as necessary." USDA's Farm Service Agency (FSA) administers the following direct payment programs; producers may file applications through local FSA offices.
Livestock Forage Disaster Program (LFP)
LFP provides payments to eligible livestock producers who suffered grazing losses for covered livestock due to drought on privately owned or cash-leased pastureland (including cropland planted specifically for grazing). A county's Drought Monitor intensity level and the drought severity and duration trigger payment.
The Federal Crop Insurance Program and the Noninsured Crop Disaster Assistance Program (NAP) provide subsidized or federally supported insurance coverage for yield, revenue, or other losses on eligible crops and livestock for covered causes of loss. Policies must be purchased prior to a disaster event. These programs are permanently authorized and have mandatory funding authority. Approved private insurance companies sell and service federal crop insurance policies. Producers must contact their crop insurance agents to file a claim following a loss. NAP coverage is for crops that are ineligible for federal crop insurance and is purchased from FSA. Producers must notify their local FSA offices following a loss.
When either the President or the Secretary of Agriculture declares a county a disaster area, agricultural producers in that county may become eligible for low-interest emergency farm loans available through FSA. USDA issues this disaster designation nearly automatically during periods of severe drought under a "fast-track" process in accordance with Drought Monitor intensity. Loans may help producers recover from production and physical losses. The program is subject to appropriations ($1.2 billion available in FY2021).
Certain nonemergency USDA conservation programs also may provide assistance during drought periods.
Conservation Reserve Program (CRP) Emergency Haying and Grazing
CRP provides annual payments to agricultural producers to take highly erodible and environmentally sensitive land out of production and install resource-conserving practices for 10 or more years. Haying and grazing may be conducted on CRP land in response to drought or other emergencies (except during primary nesting season for birds). In many cases, environmentally sensitive land is ineligible. FSA issues haying and grazing authorization. In Minnesota, this is authorized after August 1, 2021.
Environmental Quality Incentives Program (EQIP)
EQIP provides financial and technical assistance to producers to address natural resource concerns on private agricultural and forestland. Under EQIP, conservation plans can emphasize improving soil health to be more drought-resilient and fund related conservation practices, such as no-till, cover crops, and irrigation system improvement. If existing conservation practices fail due to drought, assistance may be available to restore those activities. For more information, please visit NRCS Minnesota.