7 U.S.C. § 2006b — Loan assessments

Page 1173 TITLE 7—AGRICULTURE § 2006b § 2006a. Borrower training (a) In general The Secretary shall enter into contracts to provide educational training to all borrowers of farmer program direct loans made under this chapter in financial and farm management con- cepts associated with commercial farming. (b) Contract (1) In general The Secretary may contract with State or private providers of farm management and credit counseling services (including a com- munity college, the extension service of a State, a State department of agriculture, or a nonprofit organization) to carry out this sec- tion. (2) Consultation The Secretary may consult with the chief executive officer of a State concerning the identity of the contracting organization and the process for contracting. (c) Eligibility for loans (1) In general Subject to paragraph (2), to be eligible to ob- tain a direct loan under this chapter, a bor- rower must obtain management assistance under this section, appropriate to the manage- ment ability of the borrower (as determined by the appropriate county committee during the determination of eligibility for the loan). (2) Loan conditions The need of a borrower who satisfies the cri- teria set out in section 1922(a)(1)(B) or 1941(a)(1)(B) of this title for management as- sistance under this section shall not be cause for denial of eligibility of the borrower for a direct loan under this chapter. (d) Guidelines and curriculum The Secretary shall issue regulations estab- lishing guidelines and curriculum for the bor- rower training program established under this section. (e) Payment A borrower shall pay for training received under this section, and may use funds from oper- ating loans made under subchapter II to pay for the training. (f) Waivers (1) In general The Secretary may waive the requirements of this section for an individual borrower if the Secretary determines that the borrower demonstrates adequate knowledge in areas de- scribed in this section. (2) Criteria The Secretary shall establish criteria pro- viding for the application of paragraph (1) con- sistently in all counties nationwide. (Pub. L. 87–128, title III, § 359, as added Pub. L. 101–624, title XVIII, § 1818(a), Nov. 28, 1990, 104 Stat. 3829; amended Pub. L. 105–277, div. A, § 101(a) [title VIII, § 805(3)], Oct. 21, 1998, 112 Stat. 2681, 2681–39; Pub. L. 107–171, title V, §§ 5316, 5501(c), May 13, 2002, 116 Stat. 348, 351; Pub. L. 113–79, title V, § 5306, Feb. 7, 2014, 128 Stat. 840.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in subsecs. (a) and (c), was in the original ‘‘this title’’, meaning title III of Pub. L. 87–128, Aug. 8, 1961, 75 Stat. 307, known as the Consoli- dated Farm and Rural Development Act, which is clas- sified principally to this chapter. For complete classi- fication of title III to the Code, see Short Title note set out under section 1921 of this title and Tables. AMENDMENTS 2014—Subsec. (c)(2). Pub. L. 113–79 substituted ‘‘sec- tion 1922(a)(1)(B) or 1941(a)(1)(B)’’ for ‘‘section 1922(a)(2) or 1941(a)(2)’’. 2002—Subsec. (c)(1). Pub. L. 107–171, § 5501(c), struck out ‘‘established pursuant to section 1982 of this title,’’ after ‘‘appropriate county committee’’. Subsec. (f). Pub. L. 107–171, § 5316, added subsec. (f) and struck out heading and text of former subsec. (f). Text read as follows: ‘‘The Secretary may waive the require- ments of this section for an individual borrower on a determination by the county committee that the bor- rower demonstrates adequate knowledge in areas de- scribed in this section.’’ 1998—Subsec. (a). Pub. L. 105–277, § 101(a) [title VIII, § 805(3)(A)], struck out ‘‘and guaranteed’’ after ‘‘direct’’. Subsec. (c). Pub. L. 105–277, § 101(a) [title VIII, § 805(3)(B)], struck out ‘‘or guaranteed’’ after ‘‘direct’’ in pars. (1) and (2). § 2006b. Loan assessments (a) In general The Secretary shall evaluate, in accordance with regulations issued by the Secretary, the farming plan and financial situation of each qualified farmer or rancher applicant. (b) Determinations In evaluating the farming plan and financial situation of an applicant under this section, the Secretary shall determine— (1) the amount that the applicant will need to borrow to carry out the proposed farming plan; (2) the rate of interest that the applicant would need to be able to cover expenses and build an adequate equity base; (3) the goals of the proposed farming plan of the applicant; (4) the financial viability of the plan and any changes that are necessary to make the plan viable; and (5) whether assistance is necessary under this chapter and, if so, the amount of the as- sistance. (c) Contract The Secretary may contract with a third party (including those entities eligible to pro- vide borrower training under section 2006a(b) of this title) to conduct loan assessments under this section. (d) Review of loans (1) In general Loan assessments conducted under this sec- tion shall include annual review of direct loans, and periodic review (as determined nec- essary by the Secretary) of guaranteed loans, made under this chapter to assess the progress Page 1174 TITLE 7—AGRICULTURE § 2006c 1 See References in Text note below. of a borrower in meeting the goals for the farm or ranch operation. (2) Contracts The Secretary may contract with an entity that is eligible to provide borrower training under section 2006a(b) of this title to conduct loan reviews under paragraph (1). (3) Problem assessments If a borrower is delinquent in payments on a direct or guaranteed loan made under this chapter, the Secretary or the contracting enti- ty shall determine the cause of, and action necessary to correct, the delinquency. (e) Guidelines The Secretary shall issue regulations pro- viding guidelines for loan assessments con- ducted under this section. (Pub. L. 87–128, title III, § 360, as added Pub. L. 101–624, title XVIII, § 1819, Nov. 28, 1990, 104 Stat. 3830; amended Pub. L. 107–171, title V, §§ 5317, 5318, May 13, 2002, 116 Stat. 348.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in subsecs. (a), (b)(5), and (d)(1), (3), was in the original ‘‘this title’’, meaning title III of Pub. L. 87–128, Aug. 8, 1961, 75 Stat. 307, known as the Consolidated Farm and Rural Development Act, which is classified principally to this chapter. For com- plete classification of title III to the Code, see Short Title note set out under section 1921 of this title and Tables. AMENDMENTS 2002—Subsec. (a). Pub. L. 107–171, § 5317, substituted ‘‘The Secretary’’ for ‘‘After an applicant is determined eligible for assistance under this chapter by the appro- priate county committee established pursuant to sec- tion 1982 of this title, the Secretary’’. Subsec. (d)(1). Pub. L. 107–171, § 5318, substituted ‘‘an- nual review’’ for ‘‘biannual review’’. § 2006c. Supervised credit The Secretary shall provide adequate training to employees of the Farmers Home Administra- tion on credit analysis and financial and farm management to— (1) better acquaint the employees with what constitutes adequate financial data on which to base a direct or guaranteed loan approval decision; and (2) ensure proper supervision of farmer pro- gram loans. (Pub. L. 87–128, title III, § 361, as added Pub. L. 101–624, title XVIII, § 1820, Nov. 28, 1990, 104 Stat. 3830.) § 2006d. Market placement The Secretary shall establish a market place- ment program for qualified beginning farmers and ranchers and other borrowers of farmer pro- gram loans that the Secretary believes have a reasonable chance of qualifying for commercial credit with a guarantee provided under this chapter. (Pub. L. 87–128, title III, § 362, as added Pub. L. 101–624, title XVIII, § 1821, Nov. 28, 1990, 104 Stat. 3831.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in text, was in the original ‘‘this title’’, meaning title III of Pub. L. 87–128, Aug. 8, 1961, 75 Stat. 307, known as the Consolidated Farm and Rural Development Act, which is classified principally to this chapter. For complete classification of title III to the Code, see Short Title note set out under section 1921 of this title and Tables. § 2006e. Prohibition on use of loans for certain purposes The Secretary shall not approve any loan under this chapter to drain, dredge, fill, level, or otherwise manipulate a wetland (as defined in section 3801(a)(16) 1 of title 16), or to engage in any activity that results in impairing or reduc- ing the flow, circulation, or reach of water, ex- cept in the case of activity related to the main- tenance of previously converted wetlands, or in the case of such activity that is already com- menced before November 28, 1990. This section shall not apply to a loan made or guaranteed under this chapter for a utility line. (Pub. L. 87–128, title III, § 363, as added Pub. L. 101–624, title XVIII, § 1824, Nov. 28, 1990, 104 Stat. 3831; amended Pub. L. 102–237, title V, § 501(i), Dec. 13, 1991, 105 Stat. 1868; Pub. L. 104–127, title VII, § 751, Apr. 4, 1996, 110 Stat. 1129.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in text, was in the original ‘‘this title’’, meaning title III of Pub. L. 87–128, Aug. 8, 1961, 75 Stat. 307, known as the Consolidated Farm and Rural Development Act, which is classified principally to this chapter. For complete classification of title III to the Code, see Short Title note set out under section 1921 of this title and Tables. Section 3801(a) of title 16, referred to in text, was sub- sequently amended, and section 3801(a)(16) no longer de- fines the term ‘‘wetland’’. However, such term is de- fined elsewhere in that section. AMENDMENTS 1996—Pub. L. 104–127 inserted at end ‘‘This section shall not apply to a loan made or guaranteed under this chapter for a utility line.’’ 1991—Pub. L. 102–237 inserted a closing parenthesis after ‘‘3801(a)(16) of title 16’’ and substituted ‘‘before November 28, 1990’’ for ‘‘prior to the date of enactment of this section’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1991 AMENDMENT Amendment by Pub. L. 102–237 effective as if included in the provision of the Food, Agriculture, Conservation, and Trade Act of 1990, Pub. L. 101–624, to which the amendment relates, see section 1101(b)(3) of Pub. L. 102–237, set out as a note under section 1421 of this title. § 2006f. Rural development certified lenders pro- gram (a) Certified lenders program (1) In general The Secretary may establish a program under which the Secretary may guarantee a loan for any rural development program that is made by a lender certified by the Secretary.