Sen. Herb Kohl (D-Wis.) has introduced legislation (S.3221) to protect eligibility for farm borrowers participating in USDA’s Farm Service Agency guaranteed-farm-loan programs.
FSA’s current loan-guarantee programs contain a limit on the number of years a borrower is eligible to receive a loan guarantee. The Food, Conservation and Energy Act of 2008 (P.L. 110-246) waives implementation of this ‘term limitation.’ The Kohl bill would extend the waiver for another two years in order to allow farmers to access loan guarantees that help cover operating expenses.
The National Farmers Union contends that if farmers and ranchers are made ineligible for the FSA guaranteed farm loan programs, they may not be able to continue farming.
“Continued access to FSA credit programs is a critical issue for America’s farm and ranch families,” says Roger Johnson, NFU president. He contends that the primary objectives of national agriculture policy should be to enable farmers to increase net farm income, improve quality of rural life and increase the number of family farmers. “With FSA guaranteed farm loan programs those farmers and ranchers with a weak financial profile and/or unable to qualify for credit would be granted an option over losing their farm or ranch,” Johnson adds.
NFU urges Congress to give the Secretary of Agriculture the authority to implement commodity loan programs with loan rates set at a level that at least equals the cost of production as measured by the Economic Research Service. In order to provide a safety net, NFU believes in establishing a revolving loan pool for all FSA loans to ensure loan repayment is credited to the FSA budget.
You can read the letter here.