The policy should include repayment periods for direct acquisition loans reflect the expected useful life of on-farm improvements, equipment, or chattel purchased with loan proceeds.  

USDA Action. FSA re-enforced the long standing policy that the repayment periods on loans reflect the useful life of the livestock, improvements, and equipment purchased with loan proceeds in a teleconference with States on April 7, 1998 and at the August 1998 State Directors' meeting. Agency will continue to re-enforce. 

Status: Fully implemented (code 1).

USDA Action. Since August 5, 1998, County Committees have no role in direct or guaranteed loan making determinations. 

Status: Fully implemented (code 1). 

USDA Action. Resolve accounting issues with OMB. Determine if there are alternatives to implementing the law and developing a process for line-of-credit loans as authorized in Section 614 of the 1996 FAIR Act. Due to provisions of the Credit Reform Act and OMB policy guidance, a direct line of credit will not be implemented. However, FSA has implemented a low-documentation direct loan program in place of a line of credit.

Status: Fully implemented (code 1).

USDA Action. Rule published in February 1999.  

Status: Fully implemented (code 1).  

USDA Action. Submitted legislation to Congress that would repeal provisions in law that prohibit farmers who have had "debt forgiveness" from ever receiving any further USDA loans or credit assistance.  

Status: Unable to be implemented (code 3). USDA submitted proposed legislation to Congress as recommended but no action was taken. 

USDA Action. Drafted and supported legislative proposal that would give USDA the authority it needs to carry out this recommendation. The legislation was included in the Senate version of the emergency supplemental appropriations bill, but was not passed by Congress.  

Status: Unable to be implemented (code 3). Will continue to support passage of legislation.

USDA Action. Provided a decision memorandum to the Secretary discussing the waivers and options to pursue.  

Status: Partially implemented (code 2). Secretary has considered on an annual basis, exempting only certain disaster and emergency programs. Appropriations bill has exempted certain payments from being offset.

USDA Action. Most loans are now approved or disapproved within 30 days. Agency regulations require a checklist of what is needed for a complete application and require that this list be provided to the applicant.  

Appropriated funds are expeditiously allocated and a minimum is held in the National Office reserve. A shorter application process for guaranteed loans under $50,000 has been developed.  Regulations were published in January 2001 for direct operating loans which will reduce paperwork and processing times.

Status: Fully implemented (code 1). 

USDA Action. The recommendation asked for five changes to the appraisal criteria process. FSA has implemented three of them and is implementing one of them (changing regulations to require that a copy of appraisals be issued within 5 days of request); and under the current requirements for appraisals will not be able to appraise land based on agricultural use.  

Status:  Partially implemented (code 2). Cannot base appraisals on agriculture value as restricted by the Uniform Standards of Professional Appraisals (USPAP).

USDA Action. FSA has authorized extended terms on shared appreciation agreements by converting them to nonprogram loans. FSA also now allows expiring shared appreciation agreements a self certified 1 year extension with additional extensions possible for another 2 years. 

Regulatory changes proposed that would: 

1. Reduce shared appreciation agreements from 10 to 5 years. 

2. Permit capital improvements to be deducted from shared appreciation agreements. 

Status: Fully implemented (code 1). A Final Rule was published on August 18, 2000.

USDA Action. The Administration supported legislation that protected tobacco quota holders, producers, and communities from the impacts of reduced tobacco product consumption and leaf production. As small farm programs and pilot projects are established, tobacco states will be carefully considered. 

Status: Unable to be implemented (code 3). Legislation was pending in Congress in Summer 1998 (the so-called National Tobacco Settlement). Bill died in Congress and there is no similar bill before Congress. 

USDA Action. On June 23, 1998, the Under Secretary for Farm and Foreign Agricultural Services (FFAS) signed a decision memorandum and chose not to enter into a contract with a private firm to audit the FSA direct loan records. It was determined that both the Office of the Inspector General and the General Accounting Office perform this function on an ongoing basis. 

Status: Not implemented (code 4). 

USDA Action. Rural Development is in the process of re-writing B&I loan guarantee regulation and will incorporate Commission's recommendation. 

Status: Partially implemented (code 2). A review of the B&I Guaranteed Loan Program regulation has bee drafted and is in interagency clearance. Section 4279-113(h) is being eliminated. 

USDA Action. A decision memo was sent to the Secretary for consideration recommending legislation to provide for a new relending program for production agriculture through the Farm Service Agency, but not funded in FY 1999. 

Status: Not implemented (code 4). No Congressional action taken.

USDA Action. The Rural-Business Cooperative Service (RBS) has produced a business programs video and provided it to the field for use in outreach. RBS has completed a lender orientation video that assists lenders in understanding the B&I program and how to access the B&I program for rural businesses. 

A brochure was also published entitled "Cooperative Stock Purchase Program" and it was distributed to the field for use in outreach. 

Status: Fully implemented (code 1). A lender orientation video has been completed and is in the process of being distributed to Rural Development State Offices. 

In addition, $170 million of B&I Guarantee Loan Program funding has been set aside in FY 2000 for cooperative development with a priority given to projects involving small or limited resource farmers and value-added cooperatives. 

USDA Action. RBS participated in an HBCU conference held on November 30, 1998, at Hampton University, Hampton, VA. As a part of this conference, attendees were advised of RBS Business Programs targeting objectives including assistance to small farmers, minority women, and beginning farmers. 

Attendees were encouraged through their cooperative agreements with RBS to provide outreach and technical assistance to target groups and areas so that better access to our programs is made to these groups/areas. On November 19-20, 1998 Rural 

Business-Cooperative Service participated in the Rural Opportunities through Revolving Loan Funds conference. The conference was a partnership between RBS, the National Rural Economics Developers Association and other sponsors with more than 125 participating. 

Status: Fully implemented (code 1). In August 1999, RBS sponsored the first National Intermediary Relending Conference in which over 110 Intermediaries attended. RBS/mission area objectives, including market development for small farm businesses was discussed. 

USDA Action. The Farm Service Agency (FSA) issued a final rule revising and streamlining its guaranteed loan regulations to give lenders and FSA more flexibility to serve applicants and borrowers. The regulations were published in February 1999. 

These revised regulations were developed after FSA held a guaranteed loan stakeholders meeting to solicit input on how to make the program work better. Both commercial banks and the Farm Credit System were represented at these meetings.  

With regards to the second part of the recommendation, that legislation be developed requiring the Food Credit System to make 15 percent of its loans to low-equity beginning farmers, Food Credit Agency (FCA) records indicate that approximately 19 percent of Food Credit Service loans are being made to low-equity beginning farmers. 

Status. Fully implemented.  

1. $85 million per year for the Farm
   Ownership Direct Loans; and
   
2. $500 million per year for the Farm
   Operating Direct Loans. 

USDA Action: For FY 2000, $150 million was requested for Direct Farm Ownership loans and $900 million for Direct Operating loans.

The FY 2001 Budget includes a request for $128 million for Direct Farm Ownership loans and $700 million for Direct Operating loans.

Status: Fully implemented (code 1). For FY 2001, $131.5 million is available for the Direct Farm Ownership loans and $700.4 million for the Direct Farm Operating loans. 

Inr FY 2000, $178 million was available for the Direct Farm Ownership loans and $935 million for the Direct Farm Operating loans.