Agriculture Secretary Tom Vilsack has notified Congress he will use $500 million in discretionary funding to cover a projected funding shortfall for farm loans. The Department of Agriculture’s Farm Service Agency, which administers the program, predicts a shortfall in funding for guaranteed farm ownership loans during the fiscal year that ends in September. Lower commodity prices and reduced farm income caused banks to become more cautious in their lending practices, creating greater demand for USDA guaranteed loans.
The Farm Service Agency announced recently that USDA was about to exhaust the $2 billion Congress approved for the program. FSA is also looking at a projected shortfall in federally assisted farm operating loans.
Source: NAFB News Service