by Lyle Hosler, project manager
Economic Development Company of Lancaster County

Lancaster Farming
January 3, 2009

With a history spanning almost 50 years of promoting, planning and funding economic development projects in Lancaster County, the Economic Development Company (EDC) of Lancaster County and its subsidiary organization, EDC Finance Corporation, actively work to provide experience, vision and resources to secure Lancaster’s future economic prosperity.

However, it was not until 2005, when the Commonwealth of Pennsylvania created the First Industries Fund program, that EDC had the resources to make agriculture a priority for its economic development agenda. Welcome to the crossroads of economic development and agriculture! Perhaps it is more like the highway merging lane where economic development and agriculture come together and travel full speed ahead. When EDC hit the ground running with the First Industries Fund four years ago, EDC personnel were often confronted with the question — “Isn’t economic development antiagriculture and responsible for construction on valuable Lancaster County farmland?” EDC, to many farmers’ initial surprise, is actually proagriculture and therefore has directed millions of dollars directly or indirectly toward projects that keep Lancaster farms economically viable and continually productive.

Since 2005, economic development efforts in Lancaster County have directly enhanced 100 projects by providing valuable capital that has been used for everything from first time farm buyer projects to robotic milking equipment purchases. In fact, 2008 has been EDC’s busiest ag economic development year to date, with more than $12 million of financing being provided to 38 projects that invested more than $32 million in new agricultural endeavors.

Through the First Industries Fund, EDC has provided numerous loans in an amount up to $200,000 that currently offer a 3 percent fixed interest rate (2 percent if the farm is preserved or in an ag security area) for a term of up to 15 years. The loans are almost always subordinate to primary bank financing and have allowed many farmers to purchase additional farmland, construct new production buildings, and take on needed upgrades, all while providing a low fixed interest rate hedge to compliment their primary financing. Additional funding is also available under a separate component of First Industries Fund for 50 percent of new machinery and equipment costs (including dairy cows) within the same interest rate structure.

Although not a direct loan through the organization, EDC continues to promote the Next Generation Farmer Loan Program that allows a first time farm purchaser to obtain bank financing at a tax exempt interest rate, saving the new farm owner 20-30 percent in interest expenses over the course of the loan. EDC assisted Lancaster County farmers in obtaining approvals for all of the $3 million in Next Generation Farmer program funds available statewide in 2007 and has nearly doubled that committed amount in 2008.
Indirectly, EDC’s strategic goal of creating an attractive and vibrant urban environment in Lancaster County helps to promote new real estate development efforts in Lancaster City and the neighboring boroughs, which reduces future development pressures on valuable surrounding farmland. Projects like the Armstrong World Industries plant redevelopment, Auntie Anne’s Lancaster City headquarters project, and the newly announced Turkey Hill Experience project in Columbia Borough, are all examples of EDC assisted projects that saved green space by focusing on urban core redevelopment.
Whether directly assisting production farming or indirectly diverting development pressures from existing green space, it is obvious economic development and agriculture are two once segregated topics that have now intersected and are successfully merged on a common path in Lancaster County.

copyright ©2009 Lancaster Farming. Used with permission.