State Rep. Sharon Schwartz expressed shock and disappointment that House Bill 2527, which she sponsored last session to provide low interest loan assistance to farmers, was killed in the Senate Agriculture Committee.
"It is ridiculous," said Schwartz. "Those senators claim to be representing family farmers. This bill would help family farmers and they just killed it."
HB 2527 passed the Kansas House of Representatives on a vote of 118 to 6 during the 1999 legislative session. The Senate Agriculture Committee had three days of hearings that ended when over the objections of Chairman Morris, the bill failed to pass the Senate Agriculture Committee.
"The Federal Reserve just raised interest rates again," Schwartz noted. "This is one area where the state can and should help. It isn't a partisan or ideological issue and it angers me to see real relief to farmers being killed."
In the past seven months, the Federal Reserve Board of Governors has raised interest rates four times for a total of 1%. On a $1 million, a 1% increase cost is $10,000.
HB 2527 would make up to $50 million available to banks, at 2% below cost and cannot be loaned out higher than 2% above the cost. If the bill were law, a farmers would be able to borrow up to $250,000 for an operating loan at 7 1/2 to 8 1/2%. Operating loans today range from 9 1/2 to 12% interest.