House Bill 617, the “Supporting Small Farmers for NC’s Future Act,” creates a new Small Farmers Support Grant Program within the North Carolina Department of Agriculture and Consumer Services. The program would provide grants to eligible small farmers for equipment, infrastructure, food processing equipment, and other operational improvements intended to strengthen the long-term viability of small farms. The bill defines a “small farmer” as one with gross cash farm income of $300,000 or less and limits eligibility to North Carolina residents age 21 or older who had at least $1,000 in farm income in the prior taxable year.
The bill also appropriates $20 million in recurring General Fund money for fiscal year 2025-26 to support the new grant fund and related initiatives. Of that amount, $12 million would go to general small-farm grants, $3 million to cold storage equipment grants, $4 million to the Carolina Farm Steward Association’s FarmsSHARE program, and $1 million to bridge loans helping farmers participate in USDA NRCS EQIP conservation contracts. The Department could retain up to 1% for administration and add up to two full-time positions to support the program.
In addition to grant funding, HB617 lowers the income threshold for the state sales tax exemption for farmers. Under the bill, the qualifying income threshold would be reduced from $10,000 to $7,500 in annual farm income, and the same lower threshold would apply to the three-year average income test. The bill also makes conforming changes to conditional exemption certificates and disaster-related extension provisions, and it applies the sales tax changes only to exemption certificates issued on or after July 1, 2025.
The overall sentiment reflected in the bill text is strongly supportive of small and family farms, emphasizing barriers to entry, land loss, consolidation, and lack of access to capital. Although no committee transcripts or recorded votes were provided, the structure and findings of the bill suggest a pro-agriculture, pro-rural economic development approach aimed at helping smaller operations remain viable and competitive.
Potential points of contention are likely to center on the size and recurring nature of the appropriation, the creation of a new grant program and administrative staffing, and the policy choice to lower the sales tax exemption income threshold. Some may view the bill as targeted relief for small farmers, while others may question whether the state should use recurring General Fund dollars for grants, bridge loans, and program administration, or whether the eligibility and income thresholds are set appropriately.
HB617 would amend Chapter 106 of the North Carolina General Statutes by adding a new Article 61B establishing the Small Farmers Support Grant Program and the Small Farmer Growth Fund, both administered by the Department of Agriculture and Consumer Services. It would also amend G.S. 105-164.13E to reduce the income threshold for the farmer sales tax exemption and make related changes to exemption certificate rules. The bill would affect small farmers, the Department, grant recipients, and farmers seeking sales tax relief, while also creating new appropriations and administrative responsibilities for the state.
The bill’s tone and stated findings are broadly favorable toward small farmers, with an emphasis on preserving family farms, improving access to capital, and supporting long-term agricultural sustainability. No committee debate or vote history was provided, so there is no recorded opposition or support beyond the bill’s text. Based on the measure itself, the sentiment appears strongly pro-farmer and pro-assistance.
The main likely areas of contention are fiscal and policy-related. Critics may object to the $20 million recurring appropriation, the use of General Fund dollars for grants and bridge loans, and the addition of administrative positions. Others may debate whether the bill’s definition of “small farmer” at $300,000 in gross cash farm income is too broad or too narrow, and whether lowering the sales tax exemption threshold from $10,000 to $7,500 appropriately targets relief to farmers most in need. Supporters are likely to emphasize the need for capital, infrastructure, and tax relief for smaller operations.