The Program lowers the interest cost on loans made by private parties to Beginning Farmers for the acquisition of Agricultural Land and Agricultural Improvements and Depreciable Agricultural Property. This is accomplished by Beginning Farmers arranging loans through Eligible Lenders in compliance with the rules in this Division, so that the Eligible Lender may exclude interest from gross income under Section 147(c)(2) of the United States Internal Revenue Code and may exempt interest from Oregon personal income taxes.
The Program does not provide any state or federal money to repay Beginning and Expanding Farmer loans, to guarantee these loans, or to repay any Aggie Bonds that are issued under the Program. Those loans and the related Aggie Bonds are secured only by the resources that eligible Beginning Farmers provide to lenders.
A lender under the Aggie Bonds Program may become a “Participating Lender.” A Participating Lender will be familiar with the Aggie Bonds Program and will have executed a master financing agreement for Aggie Bonds with the Department. The Department will maintain a list of Participating Lenders and make that list available to people considering Aggie Bond financing.