(a) Emergency Credit Revolving Fund

The need for these loans cannot be estimated accurately in advance. The following table reflects loans and related administrative expenses for the fiscal years 1970, 1971, and 1972.

Subtitle C of the Consolidated Farmers llome Administration Act of 1961 as modified by Public Law 91-606, the Disaster Relief Act of 1970, contains the authorization for emergency loans.

Establishment of Fund: The Emergency Credit Revolving Fund was established on October 15, 1961, by Subtitle C of the Consolidated Farmers Home Administration Act of 1961 to carry out the purposes of that subtitle. The fund was originally created by section 84 of the Farm Credit Act of 1933, as amended, but subsequently became known as the Disaster Loan Revolving Fund when it was transferred to the Secretary of Agriculture and the Regional Agricultural Credit Corporation was abolished under the terms of Public Law 38, approved April 6, 1949. At that time, the assets of the fund amounted to $45,494,334. Public Law 38, as amended, was repealed by the Consolidated Farmers Home Administration Act of 1961.

Additional Appropriations: From April 6, 1949, through May 12, 1966, two appropriations aggregating $160 million were made as additions to the Fund. Of this amount not to exceed $61.5 million was authorized for use in furnishing emergency feed and seed assistance to farmers and ranchers as authorized by section 2 (d) of Public Law 38, as amended. A total of $58,725,000 had been used for this purpose when the authority was withdrawn upon activation of the Emergency Credit Revolving Fund on October 15, 1961. Public Law 89-426, approved May 13, 1966, provided an appropriation of $30 million to the fund to remain available until expended. Public Law 90-328, approved June 4, 1968, authorized the borrowing of $30 million from the Commodity Credit Corporation for the fund. Public Law 91-127, approved November 26, 1969, appropriated $31,918,000 to repay the $30 million CCC loan with interest. Current Programs: Emergency loans are made at a rate of interest not in excess of 6 percent to eligible farmers, ranchers or oyster planters and to domestic corporations or partnerships engaged primarily in farming, ranching, or oyster planting in any designated emergency area, or to persons or corporations outside such areas under certain conditions who have suffered severe production losses not general to the area as a result of a natural disaster.

The Secretary of Agriculture may designate any area in the United States and in Puerto Rico and the Virgin Islands as an emergency area if he finds (1) that there exists in such area a general need for agricultural credit, and (2) that the need for such credit in such area is the result of a natural disaster. The former statutory Emergency loan eligibility requirement of inability to obtain credit elsewhere is suspended by Public Law 91-606 for loans made before the end of the first full operating year following the disaster. Thereafter, however, applicants must be unable to obtain credit elsewhere in order to qualify for additional Emergency loans based on the same disaster.

Loans may be made for any essential farm and home operating expenses, the repair or replacement of farm equipment made necessary by normal wear or natural disasters, and real property repairs or replacements made necessary by natural disasters. The loans are not generally made to refinance existing debts nor to compensate applicants for their losses resulting from the disaster. There is no statutory limit on the size of emergency loans. However, such loans are made for the minimum amount

necessary to achieve the above purposes.

Emergency loans are repayable in accordance with the applicant's ability to pay, but the repayment schedules may not exceed the maximum number of years authorized for real estate and operating loans for similar purposes under subtitles A and B of the Act. Loans are secured in a manner that reasonably protects the Government's interest and are made only when it appears that the loans can be repaid.

Subsequent loans may be made when necessary to borrowers indebted for previously authorized emergency type loans.

Public Law 91-606, approved December 31, 1970, authorized loans with special provisions for refinancing real estate debts and for cancellation of a portion of principal up to $2,500 under restricted conditions, and for deferment of interest and principal payments up to three years on loans for other than operating expenses.

Administrative Expenses: Administrative expenses for making and servicing loans under this fund are paid from this fund to the extent practicable. However, since the employees carrying out this work also perform duties for other FHA programs, it has not been practicable to identify precisely the amount of these costs. A work measurement system has been developed and is being improved to serve as a basis for determining these costs. Any expenses applicable to work under this fund which are in excess of the allocation made from this fund are provided under the appropriation "Salaries and Expenses, FHA".

Collections: The following is a resume of cumulative loan advances and repayments:

In addition to the programs listed above, the Farmers Home Administration is servicing the loans receivable of the Regional Agricultural Credit Corporation outstanding at the time this Corporation was abolished in 1949. A total of $267,616 in principal and interest had been collected on these loans through June 30, 1970, principal writeoffs totaled $1,013,649 and $48,381 principal had been reduced to judgment.

Loan Obligations: Emergency loans obligated from the Emergency Credit Revolving Fund from fiscal years 1966 through 1970 were as follows:

EMERGENCY CREDIT REVOLVING FUND

Funds available:

UNITED STATES DEPARTMENT OF AGRICULTURE
FARMERS HOME ADMINISTRATION

Table II Loans Made From the Energency Credit Revolving Pani During 1970 Fiscal Year and Cumulative from April 1949 Through June 30, 1970

(Dollars in Thousands)

"Loan costs" represent the amount advanced to borrowers for such purposes as the payment of taxes, insurance premiums, etc.

"Alabama

Alaska

$1,379,258

$1,282,607

$1,219,408

18,674
207
3,371
99,658
18,635

$40,932

$1,260,340
19,088

219
3,527
102,042

19,420 45,853

1,429

366 18,366 32,649

286

13,242

7,272

5,292 6,381 31,663

1,556 63,900

$29,672

$2,039

$128,139

95.18

སྰ°°-% ¥•°༩% °༦m༠༦ ¥°#8॰ ཊཀཱཀྐ8༣ སྱཱཊ༠༠n $#d8° ༣༠༠°? •g° $ ༤

Bote: This table does not include Regional Agricultural Credit Corporation loans made by Farm Credit Administration and transferred to
Parmers Home Administration for collection.

1/lative advances by state include the face amount of individual notes owed by borrowers transferring from one state to another while

still indebted.

2/ Includes $17,000 in Florida and $7,357,000 in Louisiana written off under provisions of the Southeast Hurricane Disaster Relief Act of 1965.