Joint ABA and State Bankers Associations Letter to Congress on ACRE Act in Reconciliation

Dear Member of Congress:

As Congress moves forward with the budget reconciliation process, we write to express our strong support for the inclusion of the bipartisan and bicameral Access to Credit for our Rural Economy (ACRE) Act of 2025 (S.838 and H.R. 1822), legislation that will help sustain and grow rural America by easing the financial burden on farmers, ranchers, and rural communities.

The ACRE Act was introduced in the Senate by Senators Jerry Moran (R-KS), Angus King (I-ME), Ruben Gallego (D-AZ), Kevin Cramer (R-ND), and Tommy Tuberville (R-AL). The House companion was introduced by Representatives Randy Feenstra (R-IA-04), Don Davis (D-NC-01), and Nathaniel Moran (R-TX-1).

Farmers and ranchers are working through an increasingly difficult economic cycle. According to the annual American Bankers Association 2024 Ag Lender Survey, the combination of lower export demand for U.S. agricultural goods and the rebound of global inventories has put significant downward pressure on global commodity prices and U.S. farm incomes. According to United States Department of Agriculture (USDA) Economic Research Service, total inflation-adjusted cash receipts are forecast to fall $14.2 billion (2.7 percent) from 2024 to $515.0 billion in 2025. Crop cash receipts are projected to decline $11.5 billion (4.6 percent) during the year, and animal/animal product cash receipts are expected to fall by $2.8 billion (1.0 percent).2 While net farm incomes are expected to rise in the short-term due to the Emergency Commodity Assistance Program (ECAP) and USDA disaster assistance payments, these measures will only temporarily offset the burden of high input prices, including interest rates, in the future.

The ACRE Act offers more long-term stability for farmers and ranchers by creating the most competitive interest rate environment possible on loans secured by farm real estate and aquaculture facilities. The legislation will also drive down the cost of homeownership in rural communities with a population of 2,500 or less by lowering interest rates on home mortgages in rural areas valued at $750,000 or less. ABA estimates the ACRE Act will lower the cost of credit by 100-150 basis points. For a young producer financing farmland purchased at $10,000 per acre, that would equal a sustained reduced yearly interest cost of $100-$150 an acre.

Over 30 million rural Americans stand to benefit from the ACRE Act. Approximately 45 percent of agricultural lenders already receive this tax treatment on agricultural loans and rural mortgages. By including FDIC-insured financial institutions, ACRE would increase competition in rural markets and help drive down borrowing costs for rural families, farmers, and ranchers. It would also improve the accessibility of affordable credit, enabling borrowers to shop for the best product, rate, and service at more than 79,000 bank branch locations nationwide.

The ACRE Act is the solution to help lower the cost of credit and increase credit availability for rural America. Congress can help our country's farmers, ranchers, and rural communities continue to grow and thrive by ensuring they have access to the credit they need. We urge you to include the ACRE Act in the budget reconciliation and appreciate your consideration.

Sincerely,
American Bankers Association
Alabama Bankers Association
Alaska Bankers Association
Arizona Bankers Association
Arkansas Bankers Association
California Bankers Association
Colorado Bankers Association
Connecticut Bankers Association
DC Bankers Association
Delaware Bankers Association
Florida Bankers Association
Georgia Bankers Association
Hawaii Bankers Association
Idaho Bankers Association
Illinois Bankers Association
Indiana Bankers Association
Iowa Bankers Association
Kansas Bankers Association
Kentucky Bankers Association
Louisiana Bankers Association
Maine Bankers Association
Maryland Bankers Association
Massachusetts Bankers Association
Michigan Bankers Association
Minnesota Bankers Association
Mississippi Bankers Association
Missouri Bankers Association
Montana Bankers Association
Nebraska Bankers Association
Nevada Bankers Association
New Hampshire Bankers Association
New Jersey Bankers Association
New Mexico Bankers Association
New York Bankers Association
North Carolina Bankers Association
North Dakota Bankers Association
Ohio Bankers League
Oklahoma Bankers Association
Oregon Bankers Association
Pennsylvania Bankers Association
Puerto Rico Bankers Association
Rhode Island Bankers Association
South Carolina Bankers Association
South Dakota Bankers Association
Tennessee Bankers Association
Texas Bankers Association
Utah Bankers Association
Vermont Bankers Association
Virginia Bankers Association
Washington Bankers Association
West Virginia Bankers Association
Wisconsin Bankers Association
Wyoming Bankers Association