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Pilot program

A small-scale, experimental program set up to test an idea or policy before being fully implemented or expanded.

Development expenditure

A capital investment that benefits a farming or ranching business for more than one year, such as buying initial assets, improving soil, or establishing business systems.

Loan guarantee

A promise by the government to repay a loan if the borrower defaults, which reduces the risk for lenders and makes it easier for borrowers to get loans.

Beginning farmer or rancher

An individual who has not operated a farm or ranch for more than 10 years, meeting specific criteria set by the USDA.

Collateral requirement

The assets (like land, equipment, or property) a borrower must pledge to a lender as security for a loan. If the borrower fails to repay, the lender can take the collateral.

Working capital

The difference between a company's current assets (what it owns or is owed that can be converted to cash within a year) and current liabilities (what it owes within a year), indicating short-term financial health.

Consolidated Farm and Rural Development Act