[Federal Register Volume 67, Number 117 (Tuesday, June 18, 2002)]
[Rules and Regulations]
[Pages 41311-41312]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-15249]



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DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Part 761

RIN 0560-AG64


Limitations on the Amount of Farm Service Agency Guaranteed Loans

AGENCY: Farm Service Agency, USDA.

ACTION: Final rule.

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SUMMARY: This rule amends the Farm Service Agency's (FSA) regulations 
by providing that the specific dollar amount of guaranteed loan limits 
will be increased annually based on an annual index of prices paid by 
farmers.

DATES: Effective on July 18, 2002.

FOR FURTHER INFORMATION CONTACT: For additional information contact 
Kathy Zeidler, Senior Loan Officer, USDA, FSA, Farm Loan Programs Loan 
Making Division, STOP 0522, 1400 Independence Avenue, SW., Washington, 
DC 20250-0522; telephone (202) 720-5199; e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be not significant for purposes of 
Executive Order 12866 and, therefore, has not been reviewed by the 
Office of Management and Budget.

Regulatory Flexibility Act

    The Farm Service Agency (FSA) certifies that this rule will not 
have a significant economic effect on a substantial number of small 
entities and, therefore, is not required to perform a Regulatory 
Flexibility Analysis as required by the Regulatory Flexibility Act, as 
amended (5 U.S.C. 601). This rule does not impact the small entities to 
a greater extent than the large entities.

Environmental Impact Statement

    It is the determination of FSA that this action is not a major 
Federal action significantly affecting the environment. Therefore, in 
accordance with the National Environmental Policy Act of 1969, Public 
Law 91-190, and 7 CFR part 1940, subpart G, an Environmental Impact 
Statement is not required.

Executive Order 12988

    This rule has been reviewed in accordance with E.O. 12988, Civil 
Justice Reform. In accordance with that Executive Order: (1) All State 
and local laws and regulations that are in conflict with this rule will 
be preempted; (2) no retroactive effect will be given to this rule; and 
(3) administrative proceedings in accordance with 7 CFR part 11 must be 
exhausted before requesting judicial review.

Executive Order 12372

    The notice related to 7 CFR part 3015, subpart V (48 FR 29115, June 
24, 1983) found the programs and activities within this rule are 
excluded from the scope of Executive Order 12372, which requires 
intergovernmental consultation with State and local officials.

Executive Order 13132

    It has been determined under section 1(a) of Executive Order 13132, 
Federalism, that this rule does not have sufficient implications to 
warrant consultation with the States. The provisions contained in this 
rule will not have a substantial direct effect on States, or on the 
relationship between the National Government and the States, or on the 
distribution of power and responsibilities among various levels of 
government.

Unfunded Mandates

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 
requires Federal agencies to assess the effects of their regulatory 
actions on State, local, and tribal governments or the private sector. 
The rule contains no Federal mandates, as defined by title II of the 
UMRA, for State, local, and tribal governments or the private sector. 
Thus, this rule is not subject to sections 202 and 205 of UMRA.

Paperwork Reduction Act

    This rule does not contain reporting or record keeping requirements 
subject to the Paperwork Reduction Act of 1995.

Federal Assistance Programs

    These changes affect the following FSA programs as listed in the 
Catalog of Federal Domestic Assistance:

10.406--Farm Operating Loans
10.407--Farm Ownership Loans

Discussion of the Final Rule

    Section 806 of the Omnibus Consolidated and Emergency Supplemental 
Appropriations Act, 1999 (the 1999 Act) [Pub. L. 105-277] amended the 
maximum guaranteed loan limits for farm ownership (FO) and farm 
operating (OL) loans in Secs. 305 and 313, respectively, of the 
Consolidated Farm and Rural Development Act (CONACT) [7 U.S.C. 1925 and 
1943, respectively]. The 1999 Act and this rule do not impact the 
maximum amounts of any other FSA farm loan programs; only guaranteed OL 
and FO loans are affected.
    Prior to the 1999 Act, FSA guaranteed FO loans were limited to a 
maximum of $300,000 and guaranteed OLs were limited to $400,000. The 
1999 Act increased these limits to a maximum of $700,000 per borrower 
for either guaranteed FO, guaranteed OL or a combination thereof, and 
requires an annual increase of the $700,000 maximum so that the loan 
limit keeps pace with inflation in the cost of farm inputs. The 1999 
Act also defines the inflation adjustment as the percentage (if any) by 
which the average of the Prices Paid by Farmers Index (as compiled by 
the National Agricultural Statistics Service of the Department of 
Agriculture) for the 12-month period ending on August 31 of the 
immediately preceding fiscal year exceeds the average of this index for 
the 12-month period ending on August 31, 1996.
    FSA published a final rule on February 12, 1999 (64 FR 7357-7403), 
revising the maximum guaranteed loan amounts in 7 CFR 762.122 in 
accordance with the 1999 Act. In accordance with the calculation 
prescribed in the 1999 Act, the maximum guaranteed loan amount 
increased to $717,000 effective October 1, 1999, then to $731,000 
effective October 1, 2000, and most recently, to $759,000 effective 
October 1, 2001. These statutorily mandated increases were implemented 
internally with or without updating the regulation. Another increase is 
expected for October 1, 2002.
    On January 24, 2001, FSA published a final rule (66 FR 7565-7568) 
that moved the regulations governing FSA guaranteed farm loan maximum 
dollar amounts from 7 CFR 762.122 to 7 CFR 761.8, and included the 
maximum amounts effective at that time. This rule will add language 
stating that the loan limits originally in effect for FY 2000 will be 
increased each year based on the percentage change in the Index and 
that the current maximum loan amount and the effective date of the 
limits will be available at all USDA Service Centers and on the FSA 
website at http://www.fsa.usda.gov. This change is made to maintain the 
accuracy of the regulations and provide the public with current loan 
limitations.
    In accordance with 5 U.S.C. 553, the Agency has determined that a 
notice requesting public comment or a proposed rule is unnecessary for 
the amendments made in this rule because they are informational 
enhancements in the regulatory language, rather than substantive 
revisions to program requirements. Any public notification

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requirements of 5 U.S.C. 553 will be met by making the maximum loan 
amounts available at any USDA Service Center nationwide and by listing 
them on the FSA website at http://www.fsa.usda.gov.

List of Subjects in 7 CFR Part 761

    Credit, Agriculture, Loan programs--Agriculture.

    Accordingly, 7 CFR part 761 is amended as follows:

PART 761--GENERAL AND ADMINISTRATIVE

    1. The authority citation for part 761 continues to read as 
follows:

    Authority: 5 U.S.C. 301, 7 U.S.C. 1989.


    2. Amend Sec. 761.8 by revising paragraphs (a) and (b) to read as 
follows:


Sec. 761.8  Loan limitations.

    (a) Dollar limits. The outstanding principal balances for a farm 
loan applicant or anyone who will sign the promissory note cannot 
exceed any of the following:
    (1) Farm Ownership loans, Beginning Farmer Down payment loans and 
Soil and Water loans:
    (i) Direct--$200,000;
    (ii) Guaranteed--$700,000 (for fiscal year 2000 and increased at 
the beginning of each fiscal year in accordance with paragraph (b) of 
this section);
    (iii) Any combination of a direct Soil and Water loan, direct Farm 
Ownership loan, guaranteed Soil and Water loan, and guaranteed Farm 
Ownership loan--$700,000 (for fiscal year 2000 and increased each 
fiscal year in accordance with paragraph (b) of this section);
    (2) Operating loans:
    (i) Direct--$200,000;
    (ii) Guaranteed--$700,000 (for fiscal year 2000 and increased each 
fiscal year in accordance with paragraph (b) of this section);
    (iii) Any combination of a direct Operating loan and guaranteed 
Operating loan--$700,000 (for fiscal year 2000 and increased each 
fiscal year in accordance with paragraph (b) of this section);
    (3) Any combination of guaranteed Farm Ownership loan, guaranteed 
Soil and Water loan, and guaranteed Operating loan--$700,000 (for 
fiscal year 2000 and increased each fiscal year in accordance with 
paragraph (b) of this section);
    (4) Any combination of direct Farm Ownership loan, direct Soil and 
Water loan, direct Operating loan, guaranteed Farm Ownership loan, 
guaranteed Soil and Water loan, and guaranteed Operating loan--the 
amount in paragraph (a)(1)(ii) of this section plus $200,000;
    (5) Emergency loans--$500,000;
    (6) Any combination of direct Farm Ownership loan, direct Soil and 
Water loan, direct Operating loan, guaranteed Farm Ownership loan, 
guaranteed Soil and Water loan, guaranteed Operating loan, and 
Emergency loan--the amount in paragraph (a)(1)(ii) of this section plus 
$700,000.
    (b) The dollar limits of guaranteed loans will be increased each 
fiscal year based on the percentage change in the Prices Paid by 
Farmers Index as compiled by the National Agricultural Statistics 
Service, USDA. The maximum loan limits for the current fiscal year are 
available in any FSA office and on the FSA website at http://www.fsa.usda.gov.
* * * * *

    Signed at Washington, DC, on March 18, 2002.
James R. Little,
Administrator, Farm Service Agency.
[FR Doc. 02-15249 Filed 6-17-02; 8:45 am]
BILLING CODE 3410-05-P