3 3,289 10 13 45 8,200 5,977 23,456 30,351 33,100 -585 -6,701 -3,668 -4,023 -618 Grain sorghum -566 -715 Oats... -672 Peaches... Peanuts.. -731 Peas.. -393 Potatoes.. -202 Raisins. -323 Rice... Safflower.. Soybeans. -2,277 -3,318 Tobacco.. -3,676 -3,384 -24 18 1,346 3,638 Purpose and financial organization.-The Federal Crop Insurance Corporation, a wholly-owned Government Corporation, was created on February 16, 1938 (7 U.S.C. 1501-1519), to carry out the provisions of the Federal 9.770 Crop Insurance Act. The purpose of this act is to promote the national welfare by improving the economic stability of agriculture through a sound system of crop insurance and providing the means for the research and experience 294 helpful in devising and establishing such insurance. The Corporation provides all-risk insurance protection to 38,378 farmers against loss from unavoidable causes. Since 1948, the crop insurance program has been conducted on a limited basis in selected counties and on selected crops to obtain adequate actuarial data for the expansion of the program to a national basis. Based on past experience, the Corporation began with the 1962 crop year, to expand the crop insurance program at a more rapid rate to additional counties and commodities. -116 -1,104 -285 -69 -1,229 -651 -810 Capital stock of $100 million is authorized to be subscribed by the United States. As of June 30, 1964, the Secretary of the Treasury held receipts for $40 million of the authorized stock, leaving $60 million unissued. Funds from the issuance of capital stock provide work-528 ing capital for the Corporation. Receipts which are for deposit to this fund come mainly from premiums for insurance protection afforded farmers on their investment in the production of insured crops. The principal payments from this fund are for indemnities to insured farmers who suffer crop losses arising from causes against which crop insurance provides protection, the direct cost of adjusting losses, and part of the administrative and operating expenses. The annual appropriation for the major portion of the administrative and operating expenses of the Corporation is presented earlier in the budget. -90 -3 -3,654 -3,680 -50 -20 -8,625 -10,350-10,881 -30,413-34, 192 Interest and other receipts. 21.98 Unobligated balance available, start of Financing.-Income from operations will provide adequate operating funds for 1966, unless unforeseen losses Therefore, no additional Capital Funds are being requested for program operations. occur. However, inasmuch as the Corporation is expanding at a more rapid rate, and will have an annual premium income of approximately $43 million by 1966, a heavy loss occurring early in the fiscal year prior to the time premiums are collected could deplete the available funds below the amount necessary to pay indemnity claims. The Corporation is requesting authority to borrow the necessary funds if required to meet such emergencies from the Commodity Credit Corporation. The following table reflects the comparison of the working capital, and insured liability from 1961 through 1966: COMPARISON OF INSURANCE LIABILITY TO CAPITAL, FISCAL YEARS 1961 THROUGH 1966 [Dollars In thousands] Revenue.. Expense. 1961 actual.. 1962 actual_ 1963 actual.. 1964 actual. 1965 estimated_ $48,016 $271,709 17.7 13.3 8.3 8.0 7.2 Net income or loss for the year. Analysis of retained earnings: Retained earnings, start of year.. Retained earnings, end of 30,479 34,267 36,875 28,229 -35,463 -38,378 2,250 -1,196 -1,503 2,493 1,438 3,689 year. 1966 estimated. 5.9 Operating results and financial condition.-Preliminary estimates for crop year 1964, fiscal year 1965, indicate a favorable loss ratio for the seventh year, out of the past 8 years. Premiums of $34.2 million are estimated to exceed indemnities by $3.8 million. For the crop years 1948 through 1963, premium income of $314.8 million exceeded indemnity costs of $294 million by $20.8 million. Premium income exceeded indemnity costs in 9 years of the 16 year period. As of June 30, 1964, the Corporation's surplus was $3.7 million. The favorable loss experience which occurred the past six out of seven years is responsible for the current favorable financial condition of the Corporation. The following table summarizes the insurance operations by commodities for 1964, 1965, and 1966. RURAL ELECTRIFICATION ADMINISTRATION General and special funds: year 2 Unobligated balance (Government equity).. 41,438 43,689 42,493 40,990 Note-Excludes contingent liabilities representing estimated insurance coverage on 1964, 1965, and 1966 crops in the following amounts: 1964, $546.9 million; 1965, $590 million; and 1966, $693 million. ཡིནྡྷུ ཙྩཱསིབྷཱུ 58 777 835 32 To carry into effect the provisions of the Rural Electrification Act of 1936, as amended (7 U.S.C. 901-924), as follows: LOAN AUTHORIZATIONS For loans in accordance with said Act, and for carrying out the provisions of section 7 thereof, to be borrowed from the Secretary of the Treasury in accordance with the provisions of section 3(a) of said Act, as follows: Rural electrification program, [$365,000,000] $350,000,000, of which [$90,000,000] $65,000,000 shall be placed in reserve to be borrowed under the same terms and conditions to the extent that such amount is required during the current fiscal year under the then existing conditions for the expeditious and orderly development of the rural electrification [program;] and rural telephone [program, $70,000,000 of which $7,000,000 shall be placed in reserve to be borrowed under the same terms and conditions to the extent that such amount is required during the current fiscal year under the then existing conditions for the expeditious and orderly development of the rural telephone program] programs; and rural telephone program, $97,000,000. (Department of Agriculture and Related Agencies Appropriation Act, 1965.) Program and Financing (in thousands of dollars) Identification code 145 274 294 93.0 Administrative expenses (see separate schedule). 05-56-3197-0-1-353 1 Selected resources as of June 30 are as follows: Undisbursed loan obligations, 1963, $1,012,832 thousand: (1964 adjustments -$3.252 thousand): 1964, $1,030,798 thousand; (1965 adjustments -$32,270 thousand); 1965, $1,040,528 thousand; 1966. $1,072,528 thousand. The Administration conducts two capital investment programs: (a) the rural electrification program to provide electric service to farms and other rural establishments; and (b) the rural telephone program to furnish and improve telephone service in rural areas. Funds for making repayable loans are borrowed from the Secretary of the Treasury. 1. Rural electrification. This capital investment program is financed through loans which bear 2% interest Loan funds available: 1 The reserve authorization of $65 million is proposed for use in either the electrification or telephone program. 2. Rural telephone.-This capital investment program is financed through loans which are made for the purpose of financing the improvement, expansion, construction, acquisition, and operation of the telephone lines and facilities or systems to furnish and improve telephone service in rural areas. The loans bear 2% interest and must be repaid within a period not to exceed 35 years. In 1950, when the telephone program started, the Census of Agriculture showed 38.2% of all farms with telephone service, fewer in both number and percentage than in 1920. Approximately 79% of the farms now have telephone service. Cumulative Rural Electrification Administration loans through June 30, 1964, will eventually provide initial or improved service to an estimated 1,965 thousand rural subscribers. STATUS OF THE TELEPHONE PROGRAM [Dollars in thousands] 1964 actual 1965 estimate 1966 estimate New loan authorization: Reserve. Borrowings from Treasury... Appropriated administrative funds, net.. Appropriated loan funds, net.. Net difference between income and expense... Administrative expenses. Total Government equity. 1 Includes capital outlay as follows: June 30, 1964, $86 thousand; 1965, $69 thousand; 1966, $63 thousand. Selected resources as of June 30 are as follows: Unpaid undelivered orders, 1963, $42 thousand (1963 adjustments, -$5 thousand); 1964, $36 thousand; 1965, $36 thousand; 1966, $36 thousand. The Administration assists electrification borrowers and potential borrowers to negotiate for adequate supplies of power on reasonable terms, and makes loans for the extension and improvement of electric and telephone services in rural areas. Business management and technical help is furnished borrowers where needed to protect the Government's loan security and to assure that construction and operation of their systems conform to approved standards and will provide continuous and reliable service. Object Classification (in thousands of dollars) 447,000 102,000 345,000 For administrative expenses, including not to exceed $500 for financial and credit reports, funds for employment pursuant to the second sentence of section 706(a) of the Organic Act of 1944 (5 U.S.C. 574), and not to exceed $150,000 for employment under section 15 of the Act of August 2, 1946 (5 U.S.C. 55a), [$11,578,000] $11,934,000. (5 U.S.C. 511-512; 7 U.S.C. 901-924; Department of Agriculture and Related Agencies Appropriation Act, 1965.) Program and Financing (in thousands of dollars) Identification code 05-56-3100-0-1-353 11.1 Permanent positions... 11.3 Positions other than permanent....... 11.5 Other personnel compensation....... 31.0 Equipment............. 5,108 5,320 5,320 11,030 11,934 11,934 -2 11,028 11,934 11,934 Total number of permanent positions.. 16 Comparative transfer to other accounts. 25 Unobligated balance lapsing----- New obligational authority.. 98 117 ALLOCATIONS RECEIVED FROM OTHER ACCOUNTS Note. Obligations incurred under allocations from other accounts are included in the schedules of the parent appropriation, Funds appropriated to the President, "Economic assistance.' |