The Kentucky Division of Conservation administers the Kentucky Equipment Revolving Fund Loan Program. The lending program was established in 1948 to provide funds to Kentucky’s 121 conservation districts for the purchase of specialized equipment to be used in projects that conserve or protect Kentucky’s soil, water and other natural resources. Equipment eligible for loans through the program includes dozers, backhoes, front-end loaders, earthmover pans, no-till drills and planters, precision applicators for agricultural chemicals, equipment for animal waste systems and other equipment suited for conservation work.
Conservation districts submit applications to the Kentucky Division of Conservation for loans, which may be up to two-thirds of the purchase price of a unit including sales tax. Loan applications are considered and voted upon by members of the Kentucky Soil and Water Conservation Commission. Upon approval, the Division of Conservation sets terms of the loan, such as uses permitted, repayment schedule, reporting requirements, and any other necessary terms, and prepares the contract. The minimum one-third down payment required may be satisfied with cash or trade-in allowance. The unit can be leased by the district to a local contractor who agrees to perform conservation work at a reasonable price, agreeable to conservation district supervisors of that district. If the equipment is to be subleased to a contractor, a similar lease contract between the conservation district and the contractor is also drafted.
The loan is extended at an interest rate of 4 percent per annum on the outstanding balance. Payments of interest and principal are required monthly. Contractors are required to report work done and to pay a flat fee per hour of work or acre on which the equipment was operated. Contracts are set up for complete payment of the principal over a three-year period for any loan less than $50,000, four years for loans $50,000 to $100,000 and five years for all loans greater than $100,000. Principal must be paid current, according to schedule, at the end of each six-month period of the contract. Specialized equipment such as no-till drills, precision applicators, animal waste systems and others will be set up on 36 equal payments.
The Division of Conservation secures title to all equipment financed until the loan has been paid in full. At that time, the equipment is released to the district and may be transferred to the contractor. Most equipment has been subleased to contractors, but in recent years more specialized equipment has been bought by individual conservation districts for lease to local land users.
The loan contract requires that contractors give priority to using the equipment to do conservation work for local land users. If no conservation work is available, contractors may use the equipment in any other type of work not specifically forbidden by the contract. However, future conservation work requests by local land users take priority and equipment would be moved to those requests in a reasonable time.
If you have questions or need additional information concerning the Equipment Revolving Fund, contact the local conservation district office in your county or Curtis M. Kirk, assistant director, Kentucky Division of Conservation by phone at 502-573-3080. Click here for a downloadable equipment loan application or a loan report form.
DOC/KDFWR Grass Drill Program - Division of Conservation and Kentucky Department of Fish and Wildlife Resources have combined resources once again to provide specialized conservation equipment to landowners to promote the benefits of planting native warm season grasses. This Grass Drill Program extends from July 1, 2004, through June 30, 2006, or until the allotted $150,000 is obligated.
