Commission's
Report Recommendation
No. / Category

Commission's Recommendations
and USDA's Action Plans

USDA Mission Area/ Agency/Contact Person

USDA Action. ATTRA's enhanced emphasis on small farmers needs additional funding because program staff and resources are at their limits of service. USDA-RBS requested $2 million in its FY 2000 budget, an increase of $700,000. ATTRA staff will be in regular contact with USDA agencies to provide information on priority research needs of small farmers.

Status: FY 2000 funding for ATTRA was increased to $1.5 million.

USDA Action. Rural Business-Cooperative Service (RBS) modified its instructions for the annual strategic plan development and revision process to specifically require that groups representing small, minority, and women farm operators be included among consultant/partnership groups in the strategic planning process as required under the Government Performance and Results Act (GPRA). 

This policy was reflected in the Administrator's FY 1999 Priority Performance Goals and an unnumbered letter to State Directors. State Directors will conduct outreach to small farm groups. 

Status: FY 2000 national program priority performance goals include working with: historically or economically disadvantaged farmers and small farmers, especially minorities, women and beginning farmers.

For the second year, for FY 2000 a set aside of $170,000,000 of B&I Guaranteed Loan Program National Office Reserve is made available for loan guarantees to cooperatives.

USDA Action. State Rural Development Directors were directed to focus on farmer-owned, value-added entities for Rural Business Enterprise Grants (RBEG), and Business & Industry (B&I) funding. 

Modified instructions for the annual strategic plan development and revision process to specifically require that groups representing small, minority, and women farm operators are included among consultant/partnership groups in the strategic planning process as required under GPRA. State Directors will conduct outreach to small farm groups.

Status: For FY 1999, RBS placed emphasis on farmer-owned, value added ventures. As a result, State Office Business Programs reported that RBS financial assistance (either directly or indirectly) benefitted small, women, minority, and beginning farmers. See below:

• $15,930,427 for B&I Guaranteed;
• $74,000 for B&I Direct; and,
• $428,202 for RBEG.

In addition, of the FY 1999 $200 million B&I Guaranteed Loan Program set-aside, $44,416,239 was obligated and $801,941 of which was obligated for cooperative stock purchases.

The same policies have been established as Administrative Priority Goals for FY 2000.

These include funds targeted for the Rural Business Enterprise Grants (RBEG), B&I Loans, and the Intermediary Relending Program (IRP).

USDA Action. For programs in which Rural Development State Directors have discretionary priority points, the State Directors have been encouraged to use discretionary points to encourage use of RBS program funds for value-added, cooperative development, and other business activities that support the marketing, supply, and service needs of small, minority, women and beginning farmers. 

Status: In fiscal year 1999, RBS  supported projects include:   $44,416,239 for B&I;  $440,840 for RBEG; and $800,000 for IRP.

Action Plan. Mission area and Rural Development State Strategic Plans have been amended to explicitly recognize those businesses, including cooperatives or other ventures, that add value to agricultural commodities resulting in economic opportunities to rural residents including small farmers. 

Status: RBS issued an unnumbered letter to Rural Development State Directors in September 1998 to implement the Commission's recommendation.

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

Status: 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. Mission area strategic plan amended to include this as a targeted objective, and State offices to be requested to amend the States' strategic plans accordingly. 

RBS issued an unnumbered letter to Rural Development State Directors in September 1998 to implement the Commission's recommendation.

Status: For FY 1999, $801,941 of the B&I Guarantee Loan program was obligated to farmers for financing start-up capital stock in a new hog processing facility.

For FY 2000, $170 million of B&I Guarantee Loan program funding has been set aside for cooperative development. Within the priority set aside, projects involving small or limited-resource farmer-owned, value-added cooperatives.

For FY 2000, an administrative priority goal is to establish one B&I Guarantee Loan per State Office in support of cooperative development.

USDA Action. RBS has modified instructions for the annual strategic plan development and revision process to specifically require that groups representing small, minority and women farm operators be included among partnership groups in the strategic planning process. 

The Community Priority principal has been amended to include "agriculturally dependent" community as a target. 

Status: A revised, draft five-year Rural Development mission area strategic plan includes RBS program funding priorities in support of small, minority, female and disadvantaged farmers, as well as cooperatives and value added programs.

USDA Action. Directed Rural Development State Directors to continue to work with State Rural Electric Cooperative Associations, individual electric cooperatives, and other entities, to promote project funding for value-added businesses that process products of small farms. 

RBS issued of an unnumbered letter to Rural Development State Directors in September 1998 to implement the Commission's recommendation.

Status: A Memorandum of Understanding (MOU) between Rural Development and NRCFC on May 4, 1999 formalized a partnership to promote B&I Guarantee Loan Program funding objectives to include value-added businesses which process products of small farmers.

USDA Action. Directed Rural Development State Directors to continue to work with State Rural Electric Cooperative Associations, individual electric cooperatives, and other entities, to promote project funding for value-added businesses that process products of small farms. 

Status: RBS issued of an unnumbered letter to Rural Development State Directors in September 1998 to implement the Commission's recommendation.

USDA Action. Modified instructions for the annual strategic plan development to specifically require that groups representing small, minority, and women farm operators be included in the strategic planning process. 

State Directors will use discretionary points to encourage use of the RBS program funds for value-added, cooperative development, and other business activities that support the marketing, supply and service needs of small farmers. 

Status: Ninety percent of all RD State Offices have now identified a staff resource to serve as a Cooperative Development Specialist. Providing staff development training to state Cooperative Specialist on an annual basis.

Nearly doubled the amount of funding available through the Rural Cooperative Development Grant (RCDG) program. 

USDA Action. The RBS Administrator sent a staff directive to Cooperative Services staff, and RBS program staff, to actively promote the availability of funding that could potentially benefit small farmer cooperatives. 

Status: RBS sent an unnumbered letter to all State Directors highlighting the importance of working with small farmers to develop value-added processing cooperatives. Will continue to work to place Cooperative Development Specialists in all Rural Development State offices.

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: 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: 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. Action plan proposes that RBS initiate cooperative research agreements in FY 1999 to assess membership policies and models, and assess the nature and extent of barriers. Studies will be completed during the fourth quarter of FY 2000 within current funds and staffing.

Status: Completed.

USDA Action: In FY 2000, an increase of $2 million was requested.

For FY 2001, an increase of $500,000 is requested for ATTRA for a total program level of $2 million.

Status: Partially Implemented (Code 2). FY 2000 funding for ATTRA was increased from $1.3 to $1.5 million.

USDA Action: The authorized funding level is $50 million, but the actual funding level has never exceeded $2 million. An increase of $3 million was requested in the FY 2000 Budget.

An increase of $2 million is requested for FY 2001, which would provide $6 million in available funding for the program.

Status: Partially Implemented (Code 2). For FY 2000, Congress appropriated $4 million for RCDG programs, which represents an increase of nearly 100% over the amount provided in FY 1999.

USDA Action: USDA requested a funding increase of $8.6 million in the President's FY 2000 Budget for a total funding level of $40 million.

For FY 2001, $45 million is included for this program, an increase of $11 million over FY 2000.

Status: Partially Implemented (Code 2). FY 1999 loans included: $20 million in loans and $13.5 million in grants. The combined programs supported 622 units, exceeding the FY 1999 target by 127 units.

In addition, $3.2 million was available for rental assistance to support 288 units in ten projects. For the FY 2000 program, $25 million in loans and $14 million in grants are available.

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