By Paul Tuthill
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Amherst, MA – Dairy farmers in Massachusetts will receive state tax credits in January totaling 3 million dollars. The dairy tax credit program is a key part of legislation passed four years ago that was aimed at preserving the diary industry in Massachusetts. WAMC's Pioneer Valley Bureau Chief Paul Tuthill reports.
The Massachusetts Diary Farm Tax Credit is meant to offset federally imposed milk price constraints. Farmers can obtain an income tax credit for any month when the farm price for milk falls below a trigger price, established by the Massachusetts Department of Agricultural Resources to reflect the cost of production.
Initial calculations last March determined Massachusetts dairy farmers would not be eligible for tax credits for 2010. But, farmers appealed, claiming the U S Department of Agriculture supplied data used to calculate the cost of milk production was inaccurate. Earlier this week, Massachusetts agricultural officials announced that a recalculation had triggered the tax credit for nine of the months in 2010.
Mark Duffy , who owns Great Brook Farm in Carlisle Massachusetts says its very good news
Officails say the average tax credit farmers will receive is less than 13 thousand dollars. Not a lot of money, but Duffy says it can make a difference.
The tax credit program was established by the Diary Farm Preservation Act, which was passed by the legislature and signed into law by Governor Deval Patrick in 2008. It was approved at a time, when some feared the state's dairy industry, which consists of mostly small family owned farms, was heading toward extinction, as farmers sold off their herds at alarming rates. Scott Soares, the Commissioner of the Massachusetts Department of Agricultural resources says the tax credit has provided a safety net.
Massachusetts has roughly 160 active dairy farms. It has lost one to two per year since 2008, some for economic reasons, but many because the next generation does not want to go into the family business.
The economics of producing dairy products on a small local scale is tricky because Commissioner Soares says dairy is part of the global economy.
The dairy farm preservation legislation also included a program to lower energy costs on farms, and it called for improved marketing and promotion. State Representative Stephen Kulik of Worthington, who served on task force that crafted much of the legislation, says public awareness has become an important part of sustaining the dairy industry in Massachusetts.
Kulik says dairy farmers in Massachusetts are a much more unified force than a few years ago, as witness by their successful effort to obtain tax credits for 2010.