November 14, 2023

SUBJECT: Program Loan Cost Expense (PLCE) Funds

> \"A\" Account Non-Recoverable Funds
>
> \"L & R\" Account Recoverable Funds

TO: All Rural Development Offices in Michigan

**[PURPOSE/INTENDED OUTCOME]{.underline}**:

This AN is notification of FY02 \"A, L, & R\" loan program cost fund
allocations.

**[COMPARISON WITH PREVIOUS AN:]{.underline}**

This AN replaces MI AN 828 (2024-A), dated October 25, 2000.

**[DEFINITION:]{.underline}**

\"A\" Account - All program loan cost expenses that are not chargeable
to a borrower or property account.

\"L\" Account - All program loan cost expenses that are chargeable to a
direct/insured borrower or property account in which the loan or primary
loan was obligated prior to October 1, 1991.

\"R\" Account - All program loan cost expenses that are chargeable to a
direct/insured borrower or property account in which the loan was
obligated after September 30, 1991.

**[IMPLEMENTATION RESPONSIBILITIES]{.underline}**:

State Office has the responsibility for monitoring
obligations/disbursements to avoid violation of the Anti-Deficiency Act.
As of October 1, 2000 we will no longer be using the RD 1955-62 to
request any Procurement Services.

***Form AD-700 will be used prior to requesting all \"A\" funds and all
contract services outside a regular BPA.***

All offices will submit this completed form (e-mail) to Noella Stone,
Program Loan Cost Coordinator (<noella.stone@mi.usda.gov>) with a CC: to
Lorelei Lubitz, Contracting Officer (<laurie.lubitz@mi.usda.gov>) PRIOR
to ordering any services, for State Office approval.

> FILING INSTRUCTIONS:

**EXPIRATION DATE**: Until Superseded Preceding RD Inst. 2024-A

MI AN 844 (2024-A)

Page 2

Once approved you will receive notification by e-mail. The State Office
will print your request, then stamp \"Funds Available\" with the date
and have the Program Official sign that copy. This process will not
cause delays in ordering services, as funding will be reviewed daily and
in the absence of Noella, Lorelei will approve.

**[APPRAISALS:]{.underline}**

Local office should continue to order by way of Blanket Purchase
Agreements (BPA), appraisals that are recoverable. The following PAC
Codes are commonly used for appraisals:

S1B1 - Single Family Real Estate Appraisal - Loan Making (Recoverable)

S4B1 - Single Family Real Estate Appraisal - Acquisition (Recoverable)

S5B1 - Single Family Real Estate Appraisal - Acquired Property
(Recoverable

This is always an R after 9-30-91

**[CARETAKERS]{.underline}**

Local offices are authorized to enter into caretaker agreements. Offices
may utilize BPA\'s or submit form AD-700 Procurement Request (one time
only) to the State Office, Attention Noella Stone. A caretaker bid over
\$2,500 will need 2 additional bids.

The following PAC codes are commonly used for caretakers:

S3F1 - Single Family property Management/Caretaking (Abandonment)
(Recoverable)

S5F1 - Single Family Property Management/Caretaking (REO) (Recoverable)

Always a 900# in FastTeller

S4F1 - Single Family Property Management/Caretaking
(Redemption-Health/Safety

Reasons) (Recoverable)

**[REAL ESTATE BROKERS]{.underline}**:

The cost of Real Estate Brokers is recoverable; therefore local offices
may continue to utilize brokers to sell inventory property.

PAC Code S5H1 - Recoverable cost or if proceeds of the sale are
adequate, broker fees may be paid from sale proceeds.

**[FORECLOSURE ATTORNEY]{.underline}**:

All foreclosures will be handled through the Howell and Traverse City
Guaranteed Offices. The State Office has set up BPA\'s for these offices
to utilize.

MI AN 844 (2024-A)

Page 3

This AN does not include all available PAC Codes. Please refer to RD
Instruction 2024-A, Exhibit D. If you need assistance in determining
what PAC Code to use or have questions regarding this AN, please contact
Noella Stone or Lorelei Lubitz.

/s/ Joanne C. DeVuyst

Joanne C. DeVuyst

State Director