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Feds declare 12 counties eligible for drought-disaster relief loans

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Thursday, Jan. 10, 2013
By Michelle Peirano
Cronkite News

WASHINGTON – After being in a severe to extreme drought for more than eight weeks, farmers in 12 Arizona counties may qualify for emergency loans, the U.S. Department of Agriculture said this week.

The government declared Apache, Maricopa, Navajo and Pinal counties natural disaster areas Wednesday and extended the declaration to eight surrounding counties. Farmers in those counties who cannot qualify for commercial loans can now apply for a low-interest government loan.

“They’ve lost crops, which essentially equates to money,” said Tanya Brown, a spokeswoman for the department’s Farm Service Agency.

The U.S. Drought Monitor says that farms in severe drought areas are likely to lose crops or areas of pasture, experience water shortage and face more water restrictions.

But Julie Murphree of the Arizona Farm Bureau said that while drought can be tough for ranchers, who need grass to graze cattle, most Arizona farmers use irrigation canals to water their crops.

Brandon Fish, who farms hay in Gilbert, agreed. He said the water table is low, but the current drought has not affected production.

Murphree said Arizona has been experiencing severe drought for 12 to 15 years. She and Robert Piceno, executive director of the Farm Service Agency in Arizona, said the state’s farmers have learned to adapt.

“A drought in Arizona is like saying there’s no rainfall in the Sahara,” Piceno said.

His office only gives out about 20 loans each year because most Arizona farms either qualify for commercial loans or do not have enough income to make payments on a government loan, Piceno said.

“They don’t take advantage of the program because they prefer not to go into debt,” Piceno said. “It’s a Catch-22 kind of thing.”

It is unlikely that Arizona farmers will take out emergency loans in the next few months, he said. Drought is common in Arizona, so farmers cannot continually pay for loans.

This year’s drought already extends to much of the nation. Wednesday’s disaster designation brought the number of U.S. counties severely affected by drought to 597, which is a high number for so early in the year, said Chandler Goule, vice president of government relations for the National Farmers Union.

“That’s a very bad sign that we are about to have another very long, widespread drought again this year,” Goule said.

Last year, the area of the U.S. experiencing moderate to extreme drought peaked at 61.8 percent, the largest recorded since 1956, according to the National Climatic Data Center.

Goule echoed Piceno, saying that since drought is happening more often, farmers cannot afford to keep taking out government loans, despite the low interest rate.

“If there is a drought next year, they have to take another loan out,” Goule said. “Producers can’t just take low-interest loan after low-interest loan.”

But low-interest loans are the only tool the government can currently offer farmers. While portions of the 2008 farm bill were extended until September, the extension did not include provisions for disaster relief, such as government payments for farmers with crops damaged during drought, Goule said.

Farmers in disaster areas who do not qualify for a commercial loan have until Sept. 9 to apply for a federal loan with a 2.25 percent interest rate through their local Farm Service Agency.