FOR IMMEDIATE RELEASE
ICBA, 38 State Community Banking Associations Oppose FCS Lending Expansion to Non-Farm Activities
Washington, D.C. (Oct. 22, 2007)—The Independent Community Bankers of America (ICBA) and 38 state independent community banking associations urged the U.S. Senate to oppose proposals to expand lending powers for the Farm Credit System (FCS) and prevent the system from diverting resources away from its farmer-oriented mission.
"After failing in their effort to have the House of Representatives include expanded lending authority in the 2007 Farm Bill, the FCS is now promoting an expansion proposal in the Senate on biorefineries and home mortgage lending that is not narrow, does not constitute a compromise, and would do substantial harm to farmer-owned biofuels businesses and rural communities," ICBA and the 38 state community banking associations wrote in their letter to the Senate. "The FCS's latest proposals shift the system's statutorily mandated focus away from farmers and farmer-owned cooperatives for biofuels financing. Under the proposal, there would be no requirements for any farmer-ownership."
The FCS's mortgage lending plan would expand its fully tax-exempt home mortgage lending authority to larger communities, without a maximum dollar limit on the size of the loans and without a requirement to address affordable housing needs. Other government-sponsored enterprises are subject to both of these requirements to ensure that government-sponsored benefits support the public good.
ICBA and the state community banking associations urge the Senate to finalize and pass the farm bill without the Farm Credit System expansions included. The Farm Bill is important legislation that helps sustain the farm economy, and it is necessary for a new farm bill to move forward. ICBA and its state and regional partners have raised concerns that the expanded powers would move the Farm Credit System far beyond its chartered purpose of focusing on lending to farmers and ranchers.
Senate Agriculture Committee Chairman Tom Harkin (D-Iowa) and Ranking Member Saxby Chambliss (R-Ga.) announced the 2007 farm bill will be marked up on Wednesday, Oct. 24.
Read the letter at www.icba.org.