Chairman Frank Lucas today released the following statement on Scott O'Malia's last day as Commissioner of the Commodity Futures Trading Commission (CFTC). Last month, O’Malia announced he would resign to pursue other opportunities.
Subcommittee Examines Credit Conditions for Agricultural Producers
Tamara Hinton, 202.225.0184
WASHINGTON – Today, Rep. Jeff Fortenberry (R-NE), Chairman of the House Agriculture Committee's Subcommittee on Department Operations, Oversight, and Credit held a public hearing to review credit conditions in rural America. A number of institutions provide credit to our nation's farmers, ranchers, and rural constituents. It is important to ensure credit is readily available through institutions that are fundamentally sound.
Congress established the Farm Credit System (FCS) in the Federal Farm Loan Act of 1916 to provide a reliable source of credit to agricultural producers, certain agriculture-related businesses, and rural homeowners. The Federal Agriculture Mortgage Corporation ("Farmer Mac") provides credit for agricultural real estate, rural housing, and rural utility loans on the secondary loan market. Both FCS and Farmer Mac are regulated by the Farm Credit Administration (FCA), which is an independent federal agency.
The U.S. Department of Agriculture Farm Service Agency (FSA) provides direct and guaranteed loans to producers who cannot obtain credit from commercial lenders. Much of the loan dollars from FSA are reserved for beginning farmers and ranchers who do not have the required resources to obtain financing from FCS or commercial lenders.
Additionally, local banks provide a significant amount of credit for rural communities.
Members of the Subcommittee heard from two panels of witnesses that included representatives from the FSA, FCA, Farmer Mac, the Federal Reserve Bank, local banks, and the agriculture community. They provided insight into the availability of credit for producers and the potential risks.
"While conditions are generally good in rural America, the agricultural economy is highly cyclical. We must ensure that good and fair farm and agricultural credit policies are in place to further strengthen agriculture’s critical role in our nation’s economic, energy, and national security," said Chairman Jeff Fortenberry.
"I'm grateful to have had an opportunity to discuss the soundness of credit extended to farmers and how that credit affects the larger economy. These issues will affect the food Americans serve their families and play a role in our economic recovery. I hope to continue productive conversations on the topic," said Ranking Member Marcia L. Fudge.
Written testimony provided by the witnesses is available below and can be found on the Committee's website by clicking here.
Mr. Val Dolcini, Acting Administrator, Farm Service Agency, U.S. Department of Agriculture, Washington, D.C.
Mr. Chris Beyerhelm, Deputy Administrator for Farm Loan Programs, Farm Service Agency, U.S. Department of Agriculture, Washington, D.C.
The Honorable Leland A. Strom, Chairman and Chief Executive Officer, Farm Credit Administration, McLean, Virginia
Mr. Jason Henderson, Vice President, Federal Reserve Bank of Kansas City
Mr. Michael A. Gerber, President and Chief Executive Officer, Federal Agricultural Mortgage Corporation (Farmer Mac), Washington, D.C.
Mr. Doug Stark, President and Chief Executive Officer, Farm Credit Services of America, on behalf of the Farm Credit System, Omaha, Nebraska
Mr. Matthew H. Williams, Chairman and President, Gothenburg State Bank, on behalf of the American Bankers Association, Gothenburg, Nebraska
Mr. Matt Starline, Owner, Starline Organics, LLC, Athens, Ohio