By CELESTE BAUMGARTNER
Ohio Correspondent

COLUMBUS, Ohio — The Ag-Link deposit program, which increases the availability of low-interest loans for farmers, got a boost when the Ohio Senate unanimously approved Senate Bill 250.

The bill, which was sponsored by Sen. Karen Gillmor (R-Tiffin) and joint sponsored by Sen. Jason Wilson (D-Colum-biana), would expand funds available under Ohio’s Ag-Link deposit program.
“This program used linked-deposit interest from the state to help lower the interest on loans that farmers would take out through their banks,” said Gillmor, who is a member of the Senate Agricultural Committee. “It is one other element – financial instrument – that a banker can help a farmer put together so that the farmer can buy his seed, fertilizer and get started in the spring.”

The program was started by the legislature in 1985, Gillmor said. It was thought that the Treasurer of State could take the interest from short-term investments that the state made and use it for various programs. Ag-Link was one of those programs.

Ag-Link reduces the cost of operating loans for farmers by directing the interest, earned on certificates of deposit purchased by the state at participating financial institutions, on to the borrower, thereby “linking” them. In other words, Gillmor said, the State Treasurer deposits money in a bank and the interest that the state would have collected on that deposit is instead used to lower the interest rate for farmers participating in Ag-Link program.

Under Ohio law, the State Treasurer can invest up to 12 percent of the state’s total average investment portfolio in linked deposit programs. In April of this year $123 million in Ag-Link funds had already been applied for and granted, Gillmor said. The Treasurer (Kevin L. Boyce) asked to have the ceiling raised from $125 million to $200 million.

“I looked back at the program (it began in 1985) and saw that in some years it was undersubscribed,” Gillmor said. “I knew the program was widely recognized in Ohio; it wasn’t because people didn’t know that it could be applied for.

“I asked the Ohio Farm Bureau Federation whether they thought $100,000 was not enough money per entity to borrow and meet the need,” she said. “They said that’s probably true, and they got me the number $150,000. That not only increases the pot of money from $125 million to $200 million with no new money, but it increases the amount that an entity can borrow from $100,000 to $150,000.”

Farmers apply for Ag-Link loans through their banker or ag credit.
“This is one piece of what the farmers need,” Gillmor said. “It could be all they need or it could be part of a package of many sources.”
Since passing the Senate, the bill will now move through the House. It must be signed by the governor – which should not be a problem since his Treasurer of State asked for it. The bill will go into effect in 90 days after the signing.

The Gillmor family has been in farming in Seneca and Sandusky Counties for several generations, Gillmor said.

“Our family cares a lot about our No. 1 industry in the state,” she said.