Number range CHAPTERCREDIT

Subtitle A---Farm Ownership Loans

Sec.5001.Limitations on amount of direct farm ownership loans.

Sec.5002.Down payment loan program for beginning or socially
disadvantaged farmers or ranchers.

Subtitle B---Operating Loans

Sec.5101.Limitations on amount of direct operating loans.

Sec.5102.Suspension of limitation on period for which borrowers are
eligible for guaranteed assistance.

Subtitle C---Administrative Provisions

Sec.5201.Loan authorization levels.

Sec.5202.Reservation of funds for loans for beginning or socially
disadvantaged farmers or ranchers.

Sec.5203.Conforming amendments.

CONGRESSDOC

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Subtitle A---Farm Ownership Loans

**SEC. 5001. LIMITATIONS ON AMOUNT OF DIRECT FARM OWNERSHIP LOANS.**

Section 305(a)(2) of the Consolidated Farm and Rural Development Act (7
U.S.C. 1925(a)(2)) is amended by striking "\$200,000" and inserting
"\$500,000 (reduced by the amount of any unpaid indebtedness of the
borrower on direct operating loans under subtitle B made by the
Secretary)".

**SEC. 5002. DOWN PAYMENT LOAN PROGRAM FOR BEGINNING OR SOCIALLY
DISADVANTAGED FARMERS OR RANCHERS.**

Section 310E of the Consolidated Farm and Rural Development Act (7
U.S.C. 1935) is amended---

> \(1\) in subsection (a)(1), by striking "farmers and ranchers" and
> inserting "farmers or ranchers or socially disadvantaged farmers or
> ranchers";
>
> \(2\) in subsection (b)---
>
> \(A\) in paragraph (2), by striking "4 percent" and inserting "2
> percent";
>
> \(B\) in paragraph (3), by striking "15 years" and inserting "16
> years"; and
>
> \(C\) in paragraph (4)---
>
> \(i\) by striking "Each" and inserting the following:
>
> "(A) [In general]{.smallcaps}.---Each"; and
>
> \(ii\) by adding at the end the following:
>
> "(B) [First installment]{.smallcaps}.---The first installment for a
> loan made under this section shall be due 2 years after the date on
> which the loan is made with annual installments being due
> thereafter.";
>
> \(3\) in subsection (c)---
>
> \(A\) in paragraph (1), by striking "10 percent" and inserting "5
> percent"; and
>
> \(B\) by striking paragraph (2) and inserting the following:
>
> "(2) [Maximum down payment loan amount]{.smallcaps}.---A loan for a
> down payment made under this section shall not exceed \$200,000."; and
>
> \(4\) in paragraphs (3) and (4) of subsection (d), by striking
> "beginning farmers and ranchers" each place it appears and inserting
> "beginning farmers or ranchers or socially disadvantaged farmers or
> ranchers".

Subtitle B---Operating Loans

**SEC. 5101. LIMITATIONS ON AMOUNT OF DIRECT OPERATING LOANS.**

Section 313(a)(1) of the Consolidated Farm and Rural Development Act (7
U.S.C. 1943(a)(1)) is amended by striking "\$200,000" and inserting
"\$500,000 (reduced by the amount of any unpaid indebtedness of the
borrower on direct loans under the sections specified in section 305
made by the Secretary)".

**SEC. 5102. SUSPENSION OF LIMITATION ON PERIOD FOR WHICH BORROWERS ARE
ELIGIBLE FOR GUARANTEED ASSISTANCE.**

Section 5102 of the Farm Security and Rural Investment Act of 2002 (7
U.S.C. 1949 note; Public Law 107--171) is amended by striking "2007" and
inserting "2012".

Subtitle C---Administrative Provisions

**SEC. 5201. LOAN AUTHORIZATION LEVELS.**

Section 346(b)(1) of the Consolidated Farm and Rural Development Act (7
U.S.C. 1994(b)(1)) is amended by striking "2007" and inserting "2012".

**SEC. 5202. RESERVATION OF FUNDS FOR LOANS FOR BEGINNING OR SOCIALLY
DISADVANTAGED FARMERS OR RANCHERS.**

\(a\) [Authorization of Loans]{.smallcaps}.---Section 346(b) of the
Consolidated Farm and Rural Development Act (7 U.S.C. 1994(b)) is
amended---

> \(1\) in paragraph (2)-
>
> \(A\) in the paragraph heading, by striking "[and
> ranchers]{.smallcaps}" and inserting "[or ranchers or socially
> disadvantaged farmers or ranchers]{.smallcaps}";
>
> \(B\) in subparagraph (A)---
>
> \(i\) in clauses (i)(I), (ii), and (iii), by striking "and ranchers"
> each place it appears and inserting "or ranchers or socially
> disadvantaged farmers or ranchers";
>
> \(ii\) in clause (i)(I), by striking "70 percent" and inserting "100
> percent";
>
> \(iii\) in clause (ii)---
>
> \(I\) in subclause (II), by striking "and" at the end;
>
> \(II\) in subclause (III), by striking the period at the end and
> inserting "; and"; and
>
> \(III\) by adding at the end the following:
>
> "(IV) for each of fiscal years 2008 through 2012, 70 percent."; and
>
> \(IV\) in clause (iii)---
>
> (aa) in the clause heading, by striking "[September 1]{.smallcaps}"
> and inserting "[August 15]{.smallcaps}"; and
>
> (bb) by striking "September 1" and inserting "August 15";
>
> \(C\) in clauses (i) and (ii) of subparagraph (B), by striking
> "farmers and ranchers" each place it appears and inserting "farmers or
> ranchers"; and
>
> \(D\) in the subparagraph heading of subparagraph (C), by striking
> "[farmers and ranchers]{.smallcaps}" and inserting "[farmers or
> ranchers]{.smallcaps}";
>
> \(2\) by striking paragraph (3); and
>
> \(3\) by redesignating paragraph (4) as paragraph (3).

\(b\) [Reallocation.]{.smallcaps}---Section 346(b) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 1994(b)) is amended by adding
at the end the following:

> "(5) [Reallocation]{.smallcaps}.---
>
> "(A) [Qualified beginning farmers or ranchers]{.smallcaps}.---Any
> funds reserved and allocated under paragraph (2) for qualified
> beginning farmers or ranchers in a State but not used within the State
> as of the applicable date specified in subparagraphs (A)(iii) or
> (B)(iii) of paragraph (2), shall be redistributed by the Secretary, in
> order of priority, to make or guarantee loans for---
>
> "(i) pending applications from qualified beginning farmers or ranchers
> in other States for the same type and category of loan under this
> title as the unused funds were originally made available;
>
> "(ii) pending applications from qualified beginning farmers or
> ranchers within the State or in other States for farm ownership
> (including down payment loans) or operating loans or loan guarantees
> under this title;
>
> "(iii) pending applications from socially disadvantaged farmers or
> ranchers within the State or in other States for farm ownership
> (including down payment loans) or operating loans or loan guarantees
> under this title;
>
> "(iv) pending applications within the State for farm ownership
> (including down payment loans) or operating loans or loan guarantees
> under this title;
>
> "(v) pending applications for farm ownership (including down payment
> loans) or operating loans or loan guarantees under this title in other
> States, as determined by the Secretary.
>
> "(B) [Socially disadvantaged farmers or ranchers]{.smallcaps}.---Any
> funds reserved and allocated under paragraph (2) for socially
> disadvantaged farmers or ranchers in a State but not used within the
> State as of the applicable date specified in subparagraphs (A)(iii) or
> (B)(iii) of paragraph (2), shall be redistributed by the Secretary, in
> order of priority, to make or guarantee loans for---
>
> "(i) pending applications from socially disadvantaged farmers or
> ranchers in other States for the same type and category of loan under
> this title as the unused funds were made available;
>
> "(ii) pending applications from socially disadvantaged farmers or
> ranchers within the State or in other States for farm ownership
> (including down payment loans) or operating loans or loan guarantees
> under this title;
>
> "(iii) pending applications from beginning farmers or ranchers within
> the State or in other States for farm ownership (including down
> payment loans) or operating loans or loan guarantees under this title;
>
> "(iv) pending applications within the State for farm ownership
> (including down payment loans) or operating loans or loan guarantees
> under this title;
>
> "(v) pending applications for farm ownership (including down payment
> loans) or operating loans or loan guarantees under this title in other
> States, as determined by the Secretary.".

\(c\) [Transitional Period]{.smallcaps}.-In carrying out the amendments
in subsection (a) with respect to operating loans, to ensure an orderly
transition of the program, the Secretary may phase in the increases in
the reservation of funds over a period of time that cannot exceed three
years from the date of enactment of this Act.

**SEC. 5203. CONFORMING AMENDMENTS.**

\(a\) [Beginning Farmers or Ranchers]{.smallcaps}.---Sections 309(i)(1),
335(c), and 362 of the Consolidated Farm and Rural Development Act (7
U.S.C. 1929(i)(1), 1985(c), 2006d) are amended by striking "beginning
farmers and ranchers" each place it appears and inserting "beginning
farmers or ranchers".

\(b\) [Socially Disadvantaged Farmers or Ranchers]{.smallcaps}.---

> \(1\) [Definition of socially disadvantaged farmer or
> rancher]{.smallcaps}.---Section 343(a) of the Consolidated Farm and
> Rural Development Act (7 U.S.C. 1991(a)) is amended by adding at the
> end the following:
>
> "(14) [Socially disadvantaged farmer or rancher]{.smallcaps}.---The
> term 'socially disadvantaged farmer or rancher' has the meaning given
> the term in section 355(e).".
>
> \(2\) [Target participation rates]{.smallcaps}.---Section 355 of the
> Consolidated Farm and Rural Development Act (7 U.S.C. 2003) is
> amended---
>
> \(A\) in subsection (a)(3), by striking "socially disadvantaged
> farmers and ranchers" and inserting "socially disadvantaged farmers or
> ranchers"; and
>
> \(B\) in subsection (c)(2), by striking the last sentence.