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CONTENTS

H. R. 10158. A bill to extend the authority of the Secretary of Agriculture

to make special livestock loans, and for other purposes.

H. R. 10317. A bill to authorize emergency refinancing loans to farmers in

disaster areas.

H. R. 10318. A bill to authorize emergency refinancing loans to farmers in

disaster areas.

H. R. 10356. A bill to authorize emergency refinancing loans to farmers in

disaster areas.

H. R. 10397. A bill to authorize emergency refinancing loans to farmers in

disaster areas.

H. R. 10954. A bill to provide for emergency credit to farmers and stock-

men in certain disaster areas to refinance certain indebtedness, and for

other purposes.

Statement of -

Andersen, Hon. H. Carl, a Representative in Congress of the Seventh

District of the State of Minnesota...

Everett, Hon. Robert A., a Representative in Congress of the Eighth

District of the State of Tennessee.

Gathings, Hon. E. C., a Representative in Congress of the First Dist-

rict of the State of Arkansas.

Hansen, Kermit H., Administrator, accompanied by Henry Smith,

Farmers' Home Administration, and Charles Barnard of the Farm-

ers' Home Administration, United States Department of Agricul-

ture.

Jones, Hon. Paul C., a Representative in Congress of the 10th District

of the State of Missouri.

Long, Hon. George S., a Representative in Congress of the Eighth

District of the State of Louisiana-

O'Hara, Hon. Joseph P., a Representative in Congress of the Second

District of the State of Minnesota.--

Rogers, Hon. Walter, a Representative in Congress of the 18th Dist-

rict of the State of Texas.

Smith, Hon. Frank E., a Representative in Congress of the Third

District of the State of Mississippi.-

Additional data submitted to the subcommittee by-

Department of Agriculture:

Report on H. R. 10317 by Hon. Ezra Taft Benson, Secretary,

dated March 11, 1958.

EMERGENCY CREDIT EXTENSION TO FARMERS IN

DISASTER AREAS

FRIDAY, MARCH 7, 1958

HOUSE OF REPRESENTATIVES,
SPECIAL ACTION SUBCOMMITTEE ON
CONSERVATION AND CREDIT OF THE
COMMITTEE ON AGRICULTURE,

Washington, D.C. The subcommittee met pursuant to notice at 10 a. m., in room 1310, New House Office Building, Hon. W. R. Poage (chairman of the subcommittee) presiding.

Present: Representatives Poage, Bass, McIntire, and Harrison.

Also present: Representatives Johnson, Jones, Hagen, Smith of Mississippi, Fisher, O'Hara, Gathings, Rogers of Texas, Long, Morris, and Everett; Francis LeMay, staff consultant; John Heimburger, counsel.

Mr. Poate. The committee will please come to order.

The committee is meeting this morning to consider certain bills relating to the extension of emergency credit to farmers and stockmen in disaster areas and, particularly, the legislation proposed by Mr. Jones, of Missouri, and Mr. Gathings, of Arkansas, and similar bills on that subject.

(The bills, H. R. 10158, H. R. 10317, H. R. 10318, H. R. 10356, H. R. 10397, and H. R. 10954 are as follows:)

(H. R. 10158, 85th Cong., 1st sess. ] A BILL To extend the authority of the Secretary of Agriculture to make special livestock

loans, and for other purposes Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 2 (c) of the Act of April 6, 1949, as amended (12 U. S. C. 1148a-2 (c)), is further amended to read as follows:

"(c) In areas designated by the Secretary, where the production of livestock and livestock products constitutes a substantial part of the farm economy of the area and livestock operations in the area have been adversely affected by drought continuing over at least two years, or other natural disaster particularly affecting livestock production, loans may be made to established producers and feeders of cattle, sheep, and goats (not including the operators of commercial feed lots) who have good records of operations, but are unable temporarily to get the credit they need for continuing sound operations from recognized lenders, and who have a reasonable chance at working out their difficulties with supplementary financing. No such loans shall be made after June 30, 1960, except that supplementary advances to producers indebted for loans made under this subsection may be made as authorized by the Secretary. Loans hereunder may be made on such security as the borrower has available and for such period as the Secretary may prescribe. The creditors of the applicant will not be asked to subordinate their indebtedness but must be willing to work with the borrower to the extent of executing agreements (including standby agreements) that are reasonably necessary to give the borrower a chance to improve his situation. Loans shall bear interest at the rate of 5 per centum per annum and shall be made upon such other terms and conditions as the Secretary shall prescribe. Loans exceeding $50,000 or which would cause the borrower's indebtedness hereunder to exceed $50,000 principal balance shall be approved by the Secretary."

[H. R. 10317, 85th Cong., 2d sess. ] A BILL To authorize emergency refinancing loans to farmers in disaster areas Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Secretary of Agriculture is authorized to make loans, in any area heretofore or hereafter covered by a major disaster determined by the President under Public Law 875, Eighty-first Congress, or any area covered by a production disaster determination by the Secretary of Agriculture under section 2 (a) of Public Law 38, Eighty-first Congress, to bona fide farmers and stockmen who have a reasonable chance of continuing their farming operations but who are unable to secure necessary extensions, renewals, or refinancing of their existing indebtedness from their present creditors or from commercial banks, cooperative lending agencies, the Farmers' Home Administration or other responsible sources, at rates and terms at which they could reasonably be expected to fulfill. Such loans shall be repayable in not to exceed five years and at such rate of interest as the Secretary shall determine, but not less than 1 per centum per annum above the rate determined by the Secretary of the Treasury at the beginning of the fiscal year in which the loan is made, equal to the current average yield of outstanding marketable obligations of the United States having maturities of five years. The loans shall be evidenced by the full liability of the maker and, in case of loans to corporations or other business organizations, by the personal obligation of each person holding as much as 10 per centum of the stock or interest in the corporation or organization. The Secretary shall provide by regulations for the taking of security for such loans only such available security as will permit the borrower when feasible to secure his current operating credit from his normal credit sources.

Sec. 2. There is hereby created a revolving fund for the purposes of this Act which shall be established as a separate fund available only for the purposes of this Act. Said fund shall be composed of not more than $200,000,000, such additional amounts as Congress may from time to time approve, and collections from repayments and liquidations of loans made under section 1 of this Act. Such sums shall be borrowed by the Secretary from the Secretary of the Treasury for such terms as may be determined by the Secretary of Agriculture with interest at the rate as determined by the Secretary of the Treasury equal to the current average market yield of outstanding marketable obligations of the United States having maturities comparable to such advances.

The Secretary of the Treasury is directed to purchase any notes issued by the Secretary pursuant to this section and any renewals thereof and for such purposes may use as a public transaction, the proceeds of the sale from any securities issued under the Second Liberty Bond Act, as amended, and the purposes for which such securities may be issued under such Act, as amended, are hereby extended to include any such purchases. All redemptions, purchases, and sales by the Secretary of the Treasury of such notes shall be treated as public debt transactions of the United States.

[H, R. 10318, 85th Cong., 2d sess. ] A BILL To authorize emergency refinancing loans to farmers in disaster areas Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Secretary of Agriculture is authorized to make loans, in any area heretofore or hereafter covered by a major disaster determined by the President under Public Law 375, Eighty-first Congress, or any area covered by a production disaster determined by the Secretary of Agriculture under section 2 (a) of Public Law 38, Eighty-first Congress, to bona fide farmers and stockmen who have a reasonable chance of continuing their farming operations but who are unable to secure necessary extensions, renewals, or refinancing of their existing indebtedness from their present creditors or from commercial banks, cooperative lending agencies, the Farmers' Home Ad

ministration or other responsible sources, at rates and terms which they could reasonably be expected to fulfill. Such loans shall be repayable in not to exceed five years and at such rate of interest as the Secretary shall determine but not less than 1 per centum per annum above the rate determined by the Secretary of the Treasury at the beginning of the fiscal year in which the loan is made, equal to the current average yield of outstanding marketable obligations of the United States having maturities of five years. The loans shall be evidenced by the full liability of the maker and, in case of loans to corporations or other business organizations, by the personal obligation of each person holding as much as 10 per centum of the stock or interest in the corporation or organization. The Secretary shall provide by regulations for the taking of security for such loans only such available security as will permit the borrower when feasible to secure his current operating credit from his normal credit sources.

SEC. 2. There is hereby created a revolving fund for the purposes of this Act which shall be established as a separate fund available only for the purposes of this Act. Said fund shall be composed of not more than $200,000,000, such additional amounts as Congress may from time to time approve, and collections from repayments and liquidations of loans made under section 1 of this Act. Such sums shall be borrowed by the Secretary from the Secretary of the Treasury for such terms as may be determined by the Secretary of Agriculture with interest at the rate as determined by the Secretary of the Treasury equal to the current average market yield of outstanding marketable obligations of the United States having maturities comparable to such advances.

The Secretary of the Treasury is directed to purchase any notes issued by the Secretary pursuant to this section and any renewals thereof and for such purposes may use as a public transaction, the proceeds of the sale from any securities issued under the Second Liberty Bond Act, as amended, and the purposes for which such securities may be issued under such Act, as amended, are hereby extended to include any such purchases. All redemptions, purchases and sales by the Secretary of the Treasury of such notes shall be treated as public debt transactions of the United States.

[H. R. 10356, 85th Cong., 2d sess.) A BILL To authorize emergency refinancing loans to farmers in disaster areas Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Secretary of Agriculture is authorized to make loans, in any area heretofore or hereafter covered by a major disaster determined by the President under Public Law 875, Eighty-first Congress, or any area covered by a production disaster determination by the Secretary of Agriculture under section 2 (a) of Public Law 38, Eighty-first Congress, to bona fide farmers and stockmen who have a reasonable chance of continuing their farming operations but who are unable to secure necessary extensions, renewals, or refinancing of their existing indebtedness from their present creditors or from commercial banks, cooperative lending agencies, the Farmers' Home Administration or other responsible sources, at rates and terms at which they could reasonably be expected to fulfill. Such loans shall be repayable in not to exceed five years and at such rate of interest as the Secretary shall determine but not less than 1 per centum per annum above the rate determined by the Secretary of the Treasury at the beginning of the fiscal year in which the loan is made, equal to the current average yield of outstanding marketable obligations of the United States having maturities of five years. The loans shall be evidenced by the full liability of the maker and, in case of loans to corporations or other business organizations, by the personal obligation of each person holding as much as 10 per centum of the stock or interest in the corporation or organization. The Secretary shall provide by regulations for the taking of security for such loans only such available security as will permit the borrower when feasible to secure his current operating credit from his normal credit sources.

Sec. 2. There is hereby created a revolving fund for the purposes of this Act which shall be established as a separate fund available only for the purposes of this Act. Said fund shall be composed of not more than $200,000,000, such additional amounts as Congress may from time to time approve, and collections from repayments and liquidations of loans made under section 1 of this Act. Such sums shall be borrowed by the Secretary from the Secretary of the Treasury for such terms as may be determined by the Secretary of Agriculture with interest at the rate as determined by the Secretary of the Treasury equal to the current

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