Nebraska LB 1103: Change provisions of the Beginning Farmer Tax Credit Act

Bill Text

LEGISLATURE OF NEBRASKA
ONE HUNDRED SEVENTH LEGISLATURE
SECOND SESSION
LEGISLATIVE BILL 1103

Introduced by Brandt, 32.
Read first time January 19, 2022
Committee: Revenue
A BILL FOR AN ACT relating to the Beginning Farmer Tax Credit Act; to1
amend sections 77-5203 and 77-5209, Revised Statutes Cumulative2
Supplement, 2020; to redefine a term; to change provisions relating3
to net worth qualifications; to harmonize provisions; and to repeal4
the original sections.5
Be it enacted by the people of the State of Nebraska,6
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Section 1. Section 77-5203, Revised Statutes Cumulative Supplement,1
2020, is amended to read:2
77-5203 For purposes of the Beginning Farmer Tax Credit Act:3
(1) Agricultural assets means agricultural land, livestock, farming,4
or livestock production facilities or buildings and machinery used for5
farming or livestock production located in Nebraska;6
(2) Board means the Beginning Farmer Board created by section7
77-5204;8
(3) Cash rent agreement means a rental agreement in which the9
principal consideration given to the owner of agricultural assets is a10
predetermined amount of money. A flex or variable rent agreement is an11
alternative form of a cash rent agreement in which a predetermined base12
rent is adjusted for actual crop yield, crop price, or both according to13
a predetermined formula;14
(4) Farm means any improved or unimproved tract of land over ten15
acres in area used for or devoted to the commercial production of farm16
products;17
(5) Farm product means those plants and animals useful to man and18
includes, but is not limited to, forages and sod crops, grains and feed19
crops, dairy and dairy products, poultry and poultry products, livestock,20
including breeding and grazing livestock, fruits, and vegetables;21
(6) Farming or livestock production means the active use,22
management, and operation of real and personal property for the23
production of a farm product;24
(7) Financial management program means a program for beginning25
farmers or livestock producers which includes, but is not limited to,26
assistance in the creation and proper use of record-keeping systems,27
periodic private consultations with licensed financial management28
personnel, year-end monthly cash flow analysis, and detailed enterprise29
analysis;30
(8) Owner of agricultural assets means:31
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(a) An individual or a trustee having an ownership interest in an1
agricultural asset located within the State of Nebraska who meets any2
qualifications determined by the board;3
(b) A spouse, child, or sibling who acquires an ownership interest4
in agricultural assets as a joint tenant, heir, or devisee of an5
individual or trustee who would qualify as an owner of agricultural6
assets under subdivision (8)(a) of this section; or7
(c) A partnership, corporation, limited liability company, or other8
business entity having an ownership interest in an agricultural asset9
located within the State of Nebraska which meets any additional10
qualifications determined by the board;11
(9) Qualified beginning farmer or livestock producer means an12
individual who is a resident individual as defined in section 77-2714.01,13
who has entered farming or livestock production or is seeking entry into14
farming or livestock production, who intends to farm or raise crops or15
livestock on land located within the state borders of Nebraska, and who16
meets the eligibility guidelines established in section 77-5209 and such17
other qualifications as determined by the board; and18
(10) Share-rent agreement means a rental agreement in which the19
principal consideration given to the owner of agricultural assets is a20
predetermined portion of the production of farm products from the rented21
agricultural assets.22
Sec. 2. Section 77-5209, Revised Statutes Cumulative Supplement,23
2020, is amended to read:24
77-5209 (1) The board shall determine who is qualified as a25
beginning farmer or livestock producer based on the qualifications found26
in this section. A qualified beginning farmer or livestock producer shall27
be an individual who: (a) Has a net worth of not more than one million28
two hundred thousand dollars, including any holdings by a spouse or29
dependent, based on fair market value; (b) provides the majority of the30
day-to-day physical labor and management of his or her farming or31
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livestock production operations; (c) has, by the judgment of the board,1
adequate farming or livestock production experience or demonstrates2
knowledge in the type of farming or livestock production for which he or3
she seeks assistance from the board; (d) demonstrates to the board a4
profit potential by submitting board-approved projected earnings5
statements and agrees that farming or livestock production is intended to6
become his or her principal source of income; (e) demonstrates to the7
board a need for assistance; (f) participates in a financial management8