Kentucky Office of Agriculture Policy Programs and Partnerships Help Kentucky Farmers

The Kentucky Office of Agricultural Policy (KOAP) and the Kentucky Agricultural Development Fund (KADF) are critical players in shaping the state’s agricultural economy. The KOAP invests funds in various county, regional, and state projects designed to increase net farm income and create sustainable business enterprises. It also plays a crucial role in policy issues and is an advisory outlet on agricultural and rural issues.

In the 2021 legislative session, the Kentucky General Assembly passed Senate Bill 3, a bill that moved the administration of the KADF from the Governor’s office to the Kentucky Department of Agriculture. The Kentucky Office of Agricultural Policy provides staff support to the Kentucky Agricultural Development Board and ensures Kentucky is being good stewards of dollars from the Tobacco Master Settlement Agreement. The 1998 agreement requires tobacco companies to pay settling states, including Kentucky, billions of dollars in annual installments. The Office of Agricultural Policy oversees the boards’ investments in diversifying and supporting Kentucky agriculture.

Kentucky is the only state with this type of program. Each county has an agricultural development council where local leaders volunteer their time to serve as part of this historic initiative. The grassroots approach ensures that the needs and desires of their communities are addressed by the Kentucky Agricultural Development Board. This innovative approach has pushed Kentucky to the forefront of agricultural diversification nationwide.

“Kentucky is a model for the advancement of agriculture in the country,” says Charles Miller, a livestock farmer from Jessamine County. “That’s not something I say idly. That is something I say because people everywhere go out and talk about it and ask you about it.”

The KOAP develops agricultural and rural development programs throughout the state. This includes assisting producers in diversifying their operations, funding youth leadership programs, such as 4-H and FFA, working through the Kentucky Agricultural Finance Corporation to offer low interest loans to beginning farmers and helping farmers with energy efficiency investments and much more. More than $760 million has been invested in Kentucky agriculture as of October 2023.

KOAP and the Kentucky Department of Agriculture partner on many initiatives, but one of the most significant partnerships is through the Kentucky Proud program. This program, funded through the KADF and administered by the Kentucky Department of Agriculture, is one of the nation’s premier state branding programs.

Programs funded by KADF, have had a major impact on the landscape and success of Kentucky agriculture. Diversification and reduced dependency on tobacco production has been the most noticeable change as a result of KADF investments. The KADB makes investments in innovative proposals that:

Increase net farm income
Impact tobacco farmers, tobacco-impacted communities and agriculture across the state
Stimulate markets for Kentucky’s agricultural products
Find new ways to add value to Kentucky’s agricultural products
Explore new opportunities for Kentucky farms

Two decades ago, 60,000 to 70,000 Kentucky farms grew tobacco as a cash crop, making agriculture in the Commonwealth dependent on the success of the industry. Today, fewer than 5,000 farmers are growing tobacco. KADF investments have enabled farmers who were once growing tobacco to diversify their operations and remain on their farms.

“Diversification of our agricultural landscape is key to the financial assistance given by the Kentucky Agricultural Development Fund and the Kentucky Agricultural Finance Corporation. Together, these two combine to provide a more stable economy for the future of agriculture,” remarked Dr. Ryan Quarles, Kentucky Commissioner of Agriculture (2016-2023).

In the face of a volatile and shifting economy, investments made on the state level are extremely important to Kentucky’s success both now and in the future.

KADF Programs and Initiatives

County Ag Investment Program (CAIP) - cost-share assistance on practices to improve and diversify their current farm operations.
Youth Ag Investment Program (YAIP) - encourages students ages 9 - 18 to engage in and explore agricultural opportunities.
Next Generation Farmer Program - a specialized program that would benefit producers ages 18 to 40 who have been engaged in an agricultural operation for a minimum of three years.
Deceased Farm Animal Removal Program (DAR) - a measure to facilitate the coordination of environmentally sound and cost-effective disposal of deceased livestock.
Shared-Use Equipment Program - assists broad-based community organizations with the purchase of farm equipment. The equipment purchased is made available for producer use in a specific county on a leased basis.
Food Safety and Efficiency Incentives Program - 75/25 cost-reimbursement to increase efficiency and food safety protocol through sound consultation services. $3,750 cap.
Large and Food Animal Veterinary Incentives Program - 75/25 cost-reimbursement to increase service to large and food animals in the state. $100,000 cap.
On-Farm Energy Efficiency Incentives Program - 50/50 cost-reimbursement to increase energy efficiency of existing equipment or facilities on the farm. $10,000 cap.
Kentucky Meat Processing Investment - Over $7 million has been invested since spring 2020 in meat processing facilities across the commonwealth to expand Kentucky’s beef, dairy, pork, lamb, sheep, goat, and poultry processing capabilities.
Recurring KADF investments

Kentucky Agricultural Finance Corporation
Kentucky Department of Agriculture
University of Kentucky Research Foundation
Kentucky Beef Network, LLC
Kentucky Horticulture Council
Kentucky Dairy Development Council
Kentucky State University
Community Farm Alliance
Berea College Grow Appalachia
Kentucky Agriculture and Environment in the Classroom