1964 est 29.3 in s insurance and providing the means for the research and experience helpful in devising and establishing such insurance. The Corporation provides all-risk insurance protection to 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. Capital stock of $100 million is authorized to be subscribed by the United States. As of June 30, 1962, 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 working 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 operating and administrative expenses. The annual appropriation for the major portion of the operating and administrative expenses of the Corporation is presented earlier in the budget. Budget program. The Corporation plans to continue the accelerated expansion of the program to additional crops and counties. For the 1963 crop year (fiscal year 1964) the crop insurance program will be extended to 100 new counties, and insurance will be offered on 3 additional commodities. The following table indicates the scope of the insurance program planned for 1962, 1963, and 1964. Amounts in the 1962 column are actual and pertain to the 1961 crop year. The 1963 column pertains to the 1962 crop year and reflects the current favorable growing conditions for the 1962 insured crops. Indemnities shown in the 1964 column are estimated at 90% of the premium. 1962 fiscal 1963 fiscal year (1961 year (1962 стор усат) crop year) actual estimate Number of states. Number of counties. Estimated insurance outstanding (in thou sands), beginning of fiscal year.. Number of crops insured.. Premiums (in thousands). Indemnities (in thousands) 147 Operating results and financial condition.-Current estimates for crop year 1962, fiscal year 1963, indicate a by $6.4 million. For the crop years 1948 through 1961, favorable loss ratio for the sixth consecutive year. Prepremium income of $262.5 million exceeded indemnity miums of $22.3 million are estimated to exceed indemnities exceeded indemnity costs in 8 years of the 14 year period. costs of $246.6 million by $15.9 million. Premium income As of June 30, 1962, the Corporation's retained earnings level was $7.6 million. The favorable loss experience which occurred the past 5 years is responsible for the current favorable financial condition of the Corporation. The following table summarizes the insurance operations by commodities for 1962, 1963, and 1964. NET INCOME OR LOSS (-) ON INSURANCE OPERATIONS, BY COMMODITIES [Fiscal years ending June 30, 1962, 1963, and 1964-In thousands of dollars] Rice 1962 actual (1961 crop year) Apples 25.0 -322.1 195.0 100.0 Beans 74.2 -181.0 19.0 Citrus.. -389.4 611.0 64.0 Combined Crop -199.0 218.0 74.0 Corn... 2,113.5 -679.0 367.0 Cotton.. -484.5 68.0 259.0 Flax. -119.8 92.0 62.0 Grain Sorghum.... .4 36.0 14.0 Oats. -24.7 136.0 25.0 Peaches 9.1 -263.0 92.0 Peanuts. 179.0 107.0 Peas -214.0 97.0 282.0 300.0 41.0 -.3 7.0 9.0 Soybeans 371.4 545.0 136.0 Tobacco. 1,502.5 744.0 337.0 Wheat -737.8 4,659.0 882.0 Cherries.. 25.0 Potatoes.. -30.0 45.0 Tomatoes. Retained earnings. Non-interest-bearing capital.. Total Government equity.. 50,348 49,235 50,810 48,744 4,289 3,705 2,679 2,859 54,638 52,940 53,489 51,603 6,622 5,348 3,828 3,843 40,000 40,000 40,000 40,000 8,016 7,591 9,660 7,760 48,016 47,591 49,660 47,760 RURAL ELECTRIFICATION ADMINISTRATION General and special funds: 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, [$400,000,000] $425,000,000, of which [$100,000,000 $75,000,000 shall be placed in reserve to be borrowed under the same terms and conditions to the extent that such amount is required during the fiscal year [1963] 1964 under the then existing conditions for the expeditious and orderly development of the rural electrification [and rural telephone programs] program; and rural telephone program, [$80,000,000 $70,000,000. (Department of Agriculture and Related Agencies Appropriation Act, 1963.) Program and Financing (in thousands of dollars) Program by activities: 1. Rural electrification.. 11 Personnel compensation: Positions other than permanent.. 2. Rural telephone................ 12 Personnel benefits. 21 Travel and transportation of persons. Total program costs, funded.. Change in selected resources 1. 23 Rent, communications, and utilities.. 3 Unobligated balance brought forward (authorization to expend from public debt receipts) (-). Recovery of prior year obligations (−).. Unobligated balance carried forward (authorization to expend from public debt receipts). Unobligated balance lapsing (authorization to expend from public debt receipts).. New obligational authority (authorization to expend from public debt receipts).. 195,807 230,000 310,000 97,237 100,000 100,000 293,044 330,000 410,000 59,881 115,000 35,000 352,926 445,000 445,000 -35,151-65,887 -27,887 -6,162 65.887 27,887 2,887 30,000 73,000 75,000 407,500 480,000 495,000 1 Selected resources as of June 30 are as follows: Undisbursed loan obligations. 1961. $869.390 thousand: (1962 adjustments, $6,162 thousand); 1962, $923,110 thousand; 1963, $1,038,110 thousand; 1964, $1,073,110 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 and must be repaid within a period not to exceed 35 years. Loans are also made for shorter periods at 2% interest to electrification borrowers to be reloaned to their consumers for the purpose of financing the wiring of premises 1984 est: ΤΟΝ 149 Loan funds available: and the acquisition and installation of electrical and STATUS OF THE ELECTRIFICATION PROGRAM Program Financing [In thousands of dollars] New loan authorization (including 1962 actual 1963 estimate 1964 estimate reserves).... Carryover from prior year. 245,000 For the fiscal year: 185 Net difference.. Rescissions of prior year loans.. 1,244 5,383 Total loan funds available.. Less appropriations): Salaries and expenses.. Loans approved or estimated. 261,370 Reserve for additional loans.. Cumulative to end of fiscal year: 73,000 75,000 Lending operations: Interest income.. [Dollars in thousands] Provision for possible losses on loans. 9,090 9,090 9,090 44 44 44 Unadvanced funds, end of year. $4,680,743 $5,030,743 $5,380,743 Total expense Cumulative interest paid. Cumulative principal, repaid. $880,639 $1,097,839 $1,218,539 $1,343,239 Net difference. Cumulative miles energized (thousands). Cumulative consumers served (thousands).... $532,401 $594,901 $662,401 1,492 1,511 1,530 Administrative expenses (provided by annual Number of borrowers. 1,094 1,100 1,110 1 Includes adjustment of equipment depreciation for prior years. 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 71% of the farms now have telephone service. Cumulative REA loans through June 30, 1962, will eventually provide initial or improved service to an estimated 1,753 thousand rural subscribers. STATUS OF THE TELEPHONE PROGRAM Loans and interest receivable, net. 3,514,370 3,670,763 3,860,908 4,126,953 ceivables. Equipment, net. Total assets.. Liabilities: Trust and deposit. Total liabilities. 100 103 405 103 103 380 355 Government equity: Borrowings from Treasury. Loans funds available: 1962 actual 1963 estimate 1964 estimate Appropriated administrative funds, net. Appropriated loan funds, net. 144,845 154,823 165,285 176,629 142,620 979 Rescissions of prior year loans... 42,702 27,702 779 Net difference between income Administrative expenses (-) Less Total loan funds available.... Total Government equity....3,526,205 3,679,993 3,870,617 4,137,688 Reserve not used..... Loans approved or estimated. Balance to next year.. Note.-Undisbursed loan commitments outstanding are Proposed for separate transmittal: LOAN AUTHORIZATIONS Legislation will be proposed for the establishment of a "Rural Electrification Administration Loan Account" which will reflect the net cost of the loan programs by $70,425 showing it as the excess of the aggregate of the loans to be made over the current receipts on loans previously made. The account will be budgeted on a net expenditure basis. Loan receipts are estimated to be $151 million in 1964, adjusting new obligational authority as follows: 364 |