Farm Credit: USDA'S Implementation of the Farms for the Future Act of 1990.
Abstract
The Farmers Home Administration (FmHA), the agency to which the U.S. Department of Agriculture (USDA) has delegated responsibility for administering the demonstration program, published in the Federal Register proposed regulations to implement the program on September 24, 1991. Before FmHA published the final regulations, the 1991 amendments to the Farms for the Future Act made changes to the program that required FmHA to modify its proposed regulations. On February 4,1992, FmHA published interim regulations in the Federal Register, making the program operational on that date. As of February 10,1992, FmHA had not guaranteed any loans under the program. The Farms for the Future Act authorizes a demonstration program to guarantee loans and subsidize interest rates to help states finance efforts to protect farmland. Under the program, FmHA guarantees for 10 years the timely payment of principal and interest due on loans made by lending institutions to state trust funds. The state can use loan funds for purposes such as (1) purchasing development rights, conservation easements, or other interests in land; (2) paying the loan guarantee fee charged by FmHA; and (3) making investments to generate earnings to be used for future farmland preservation efforts. Interest rates on loans cannot exceed 10 percent. In addition to guaranteeing loans, the program subsidizes the borrower's (the state's) interest payments fully for 5 years and by at least 3 percent for an additional 5 years. The program will expire on September 30,1996. Although no new loans will be guaranteed after that date, guarantees and interest assistance payments will continue until all program agreements end. pg 2,&3. JMD
Document Details
- Document Type
- Technical Report
- Publication Date
- Feb 01, 1992
- Accession Number
- ADA292500
Entities
Organizations
- United States Government Accountability Office