Low interest loans of up to $1 million are available to primary producers in NSW to invest in permanent on-farm infrastructure that will help to manage adverse seasonal conditions, ensure long term sustainability and improve farm productivity.
Key information
- Status: Ongoing
- Grant amount: Up to $1,000,000
- Application opened: 1 January 2014
Program objective
The Drought Infrastructure Fund (formerly known as the Farm Innovation Fund) is an incentive-based initiative to assist farmers within NSW to identify and address risks to their farming business, improve permanent farm infrastructure, ensure long-term productivity and sustainable land use plus aid in meeting changes to seasonal conditions.
This program is administered by Rural Assistance Authority.
This program is funded by NSW Treasury.
Eligibility
Who can apply
To be eligible for the Drought Infrastructure Fund, you must demonstrate that:
- you are the owner or operator of a farm business where the work is to be carried out
- your business operates as a sole trader, partnership, trust, or private company and trades agricultural products
- your business is registered with the Australian Taxation Officer as a primary producer and has an Australian Business Number (ABN)
- as the owner and operator, you earn more than 50% of your gross income from your primary production enterprise under normal seasonal circumstances; or you are classified as a “new entrant”, meaning that you have been operating your farm business for between 12 months to 3 years and more than 50% of your gross income will be derived from the farm business within 3 years of the date of the application. The applications of new entrants will be considered on a case-by-case basis
- you do not have gross off-farm assets exceeding $5,000,000 (excluding funds in a registered superannuation fund).
Additional eligibility requirements:
- You must lodge an application before commencing the project.
- Loans must be fully drawn within 12 months of approval.
- You must permit the RAA or any other person authorised by the RAA to enter the property to enable inspection of the works.
- Payments will be made on receipt of eligible, valid invoices, and the RAA may inspect the works under Section 9.2 of the guidelines to ensure it is eligible and compliant.
- Valid tax invoices submitted in relation to this application may not be used to secure funding under any other NSW Government scheme.
- Successful applicants must provide the RAA with satisfactory security in accordance with the RAA’s security requirements.
- You can demonstrate that the works will have a significant beneficial impact on the land, the farming business and aid in preparing for adverse seasonal conditions.
- You can demonstrate that your farm business has long-term viability and has the capacity to repay the loan sought.
- You must demonstrate the proposed works are part of your Farm Business and Risk Assessment Plan.
What you can apply for
Funding by way of a loan is available to meet the cost of carrying out permanent capital works that will have a significant beneficial impact on the land, the long-term profitability of the business and address adverse seasonal conditions. Such works would fall into 4 main categories and include the following examples but not limited to:
Drought preparedness:
- stock and domestic water supply
- cap and piping of bores in the artesian basin
- refurbishing/desilting ground tanks
- planting perennial species
- stock containment areas.
Environment:
- soil conservation
- erosion control
- woody/noxious weed/serrated tussock control
- solar power conversions.
Farm infrastructure:
- fodder storage facilities (silo/hay shed)
- farm/shearing sheds
- fencing/road works
- storm/exclusion netting
- new/upgrading of irrigation systems.
Natural resources:
- planting trees for shade/wildlife corridors
- livestock effluent control
- fencing off of river banks
- disaster mitigation works (flood pads).
Applicants can apply for up to 100% of the net, GST exclusive cost of eligible works to a maximum of $1,000,000 with a maximum of $1,000,000 outstanding at any time.
What you can’t apply for
Activities that cannot be supported by a Drought Infrastructure Fund loan include:
- farm plant, machinery, all vehicles and transportable items such as field bins, and grain augers
- all residential farm premises/buildings
- use of own machinery or own labour
- all farm inputs
- non-farm related items.
What your application needs to include
You can download the full guidelines:
Applicants will be required to provide the following information to determine their eligibility for the program:
- last 3 years’ eligible primary production enterprise tax returns, balance sheets and Financial Statements of your farm enterprise (these include Profit and Loss Statements, Stock Trading account and Depreciation schedules)
- last 3 years individual taxation returns and a current listing of all assets and liabilities held by each: Individual members/beneficiaries of a partnership/family trust and individual director(s)/shareholder(s) of all companies
- Local Government Area (LGA) rates notice and, if available, the Local Land Service (LLS) rates notice for property where the work is to be completed
- Signed Mortgagee consent form from your existing mortgagee if required
- Farm Business Resilience Plan (or equivalent)
- Trust deed (if applicable)
- monthly cash flow budget for the next 12 months.
Important information
Interest:
- the rate will be that applying at the date on which the loan is approved and is fixed for the term of the loan
- the rate is currently 2.5%.
Term:
- up to 20 years, dependent upon the amount borrowed and the applicant’s ability to repay
- works must be completed within 12 months from the date of loan approval.
Repayments:
- monthly, half-yearly, quarterly or annual repayments of principal and interest.
Security:
- charge and registered caveat over the property on which the proposed works will be carried out (security over additional property will also be considered)
- note: the charge is specific to the works being completed, and a new charge is required for each approved advance
- funds will not be released until all security requirements have been satisfied and caveat registered over security property.
Costs:
- there are no establishment or account-keeping fees; however, costs for registering security documents and Government Stamp Duty will be borne by the applicant
- as part of the assessment process, the RAA will obtain title searches to confirm ownership of the land offered as security
- this cost will be borne by the applicant whether or not they take up the loan.
Start the application
Applications for this loan are available via the Rural Assistance Authority website.
Note: there is no cut off time to submit your application, however, loans will not be offered beyond the allocated funding. Please note that you must lodge an application before commencing the project.
For more details, please refer to the Drought Infrastructure Fund Guidelines (PDF 135.98KB).
After the application is submitted
Successful applications will be decided by: NSW Rural Assistance Authority.
The Rural Assistance Authority will assess applications received against the eligibility criteria listed in the program guidelines.
Program evaluation
The RAA is committed to providing excellent service that responds to customers' needs through well targeted programs. For that reason, the RAA evaluates its programs. This includes surveys at various points of your application, approval and completion. The RAA may also contact you to ask about your experience of the assistance you received. The RAA will always treat the responses you provide as confidential and use the information only for the purposes it was collected.