[Federal Register Volume 89, Number 37 (Friday, February 23, 2024)]
[Notices]
[Pages 13682-13684]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-03687]


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DEPARTMENT OF AGRICULTURE

Farm Service Agency

[Docket ID FSA-2023-0023]


Revised Loan Volume Requirements for the Preferred Lender Program 
and the Certified Lender Program

AGENCY: Farm Service Agency, USDA.

ACTION: Notice of eligibility criteria.

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SUMMARY: The Farm Service Agency (FSA) announces the revised loan 
volume eligibility criteria for existing lenders participating in the 
Preferred Lender Program (PLP) for FSA guaranteed loans or who have 
recently participated in PLP but lost that status due to loan volume 
requirements and wish to reapply. Due to decreased loan demand, many 
former PLP lenders, who would have otherwise been expected to have 
renewed their PLP status, have been unable to qualify for the renewal 
of their status in PLP within the past 5 years due solely to loan 
volume requirements. This document applies lower loan volume 
eligibility criteria to PLP lenders who renew their PLP status and to 
former PLP lenders who reapply for PLP status after losing that status 
because they were unable to renew due solely to decreased loan volume 
within the 5 years immediately preceding the date of this notice. FSA 
also announces the revised loan volume eligibility criteria for all 
lenders participating in the Certified Lender Program (CLP) for FSA 
guaranteed loans due to the same decreased loan demand discussed 
previously. This document applies less restrictive loan volume 
eligibility criteria to all lenders currently participating in the CLP 
program and lenders applying to participate in the CLP program.

DATES: Applicable date: February 23, 2024.

FOR FURTHER INFORMATION CONTACT: Matthew T. Henderson; telephone: (202) 
720-5847; email: <a href="/cdn-cgi/l/email-protection#94f9f5e0e0fcf1e3bafcf1faf0f1e6e7fbfaa6d4e1e7f0f5baf3fbe2"><span class="__cf_email__" data-cfemail="91fcf0e5e5f9f4e6bff9f4fff5f4e3e2feffa3d1e4e2f5f0bff6fee7">[email protected]</span></a>. Individuals who require 
alternative means for communication should contact the U.S. Department 
of Agriculture (USDA) Target Center at (202) 720-2600 (voice and text 
telephone (TTY)) or dial 711 for Telecommunications Relay service (both 
voice and text telephone users can initiate this call from any 
telephone).

SUPPLEMENTARY INFORMATION:

Background

    FSA's PLP provides qualifying lenders additional authorities and 
streamlined procedures under the FSA guaranteed farm loan programs. In 
accordance with the criteria specified in 7 CFR 762.106(c)(3), lenders 
who participate in the PLP must meet minimum loan volume thresholds 
that are established by FSA and published in a notice in the Federal 
Register. On May 5, 1999 (64 FR 24132), FSA established the current PLP 
loan volume threshold of 20 FSA guaranteed loans closed in the past 5 
years. Also, 7 CFR 762.106(c)(1) states that lenders who participate in 
the PLP must meet all requirements of CLP. The CLP loan volume 
threshold was established on February 12, 1999 (64 FR 7404). The notice 
stated that lenders participating in the CLP must have closed a total 
of at least 10 FSA guaranteed loans and at least 5 of those FSA 
guaranteed loans must have been closed in the past 2

[[Page 13683]]

years. This resulted in the requirements of 20 loans in the past 5 
years and 5 loans in the past 2 years for lenders to meet the loan 
volume requirements in 7 CFR 762.106(c)(1) and (3) to obtain PLP 
status.
    FSA regulations in 7 CFR 762.106(f)(1) specify that the maximum 
term for PLP status cannot exceed 5 years and 7 CFR 762.106(f)(3) 
specifies that lenders must continue to meet FSA's eligibility 
requirements in order to renew their status.
    Due to decreases in overall farm lending,\1\ including FSA 
guaranteed loans, many existing PLP lenders have been unable to qualify 
for the renewal of their status in the PLP within the past 5 years. In 
most cases, the lenders whose status was not renewed were well-
established PLP lenders that participated in the program for 10 years 
or longer with minimal to no losses. This results in experienced 
lenders reverting to either CLP status or Standard Eligible Lender 
(SEL) status. Individual guaranteed loan applications submitted under 
the SEL or CLP status require more supporting documentation from 
lenders, which takes more time for FSA to review. In turn, this results 
in delays for producers to receive their loan funds.
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    \1\ See Smaller Operating Loans Slow Lending Activity--Federal 
Reserve Bank of Kansas City (kansascityfed.org) at https://www.kansascityfed.org/agriculture/agfinance-updates/smaller-operating-loans-slow-lending-activity/.
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    With this notice, FSA is amending the threshold required for 
existing PLP lenders to renew their status and for former PLP lenders 
whose status was not renewed due solely to a lack of loan volume within 
the past 5 years preceding the publication of this notice when 
reapplying for PLP status. This notice revises this PLP renewal 
threshold to 10 FSA guaranteed loans closed in the past 5 years. PLP 
lenders whose status was not renewed due solely to a lack of loan 
volume within the 5 years immediately preceding the date of this notice 
must re-apply for PLP status within 180 days from the publication of 
this notice in order to be evaluated under the revised loan volume 
criteria. Lenders who have never previously held PLP status, lenders 
who lost their PLP status more than 5 years ago, or lenders who lost 
their PLP status at any time for a reason other than solely a lack of 
loan volume must continue to meet the existing requirements of 20 loans 
closed in the past 5 years.
    This action will allow more experienced PLP lenders to retain their 
status in periods of decreased application volume which will result in 
faster application turnaround times for both lenders and FSA staff when 
reviewing individual guaranteed loan applications from those lenders. 
Faster turnaround times ensure that producers receive their loan funds 
in a timely manner. Also, limiting the lower threshold of 10 FSA 
guaranteed loans closed in the past 5 years only to PLP lenders 
renewing their status and to those lenders who recently lost their PLP 
status ensures that it applies only to lenders with an established 
knowledge of FSA guaranteed loan policies, who stay abreast of any 
recent policy changes, as opposed to newer lender applicants who may be 
less experienced with FSA's guaranteed loan program requirements. 
Lenders who have never previously held PLP status have not yet 
demonstrated proficiency under the limited FSA supervision of PLP, so 
it is appropriate that they must still meet the higher threshold of 20 
loans closed in the past 5 years to initially obtain the PLP status.
    FSA's CLP provides lenders with less experience than PLP lenders 
the opportunity to operate under a partially streamlined origination 
and servicing process for FSA guaranteed loans. In accordance with the 
criteria specified in 7 CFR 762.106(b)(4), lenders who participate in 
CLP must meet minimum loan volume thresholds that are established by 
FSA and published in a notice in the Federal Register. The CLP loan 
volume threshold was established on February 12, 1999 (64 FR 7404). The 
notice stated that lenders participating in CLP must have closed a 
total of at least 10 FSA guaranteed loans and at least 5 of those FSA 
guaranteed loans must have been closed in the past 2 years.
    Due to the previously cited decreases in farm lending, including 
FSA guaranteed loans, many existing CLP and PLP lenders have been 
unable to qualify for the renewal of their respective statuses in the 
past 5 years. In addition, FSA has found that the inconsistency in the 
timeframes for the loan volume requirements (currently 5 years for PLP 
and 2 years for CLP) has created confusion and misunderstanding for 
both lenders and FSA staff.
    Therefore, with this notice, FSA is also amending the threshold 
required for existing CLP lenders to renew their status and for new 
lenders to qualify for CLP status. This notice revises that CLP loan 
volume threshold to 10 FSA guaranteed loans closed in the past 5 years. 
Since guaranteed loan applications submitted by CLP lenders have more 
strict documentation requirements than those from PLP lenders, it is 
appropriate that the loan volume threshold for initially obtaining CLP 
status is lower than that for PLP. Additionally, since the new CLP 
threshold of 10 loans closed in the past 5 years is more lenient than 
the current requirement of 5 loans closed in the past 2 years, FSA does 
not see a need for a different threshold for renewal of CLP status. The 
following table summarizes the new loan volume requirements for both 
the CLP and PLP programs:

------------------------------------------------------------------------
                                                        Required number
                                                        of loans closed
                       Scenario                          in the past 5
                                                             years
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New lenders applying for CLP status..................                 10
Existing CLP lenders renewing their status...........                 10
New lenders applying for PLP status..................                 20
Existing PLP lenders renewing their status (and                       10
 former PLP lenders reapplying for PLP status after
 losing that status solely due to decreased loan
 volume within the 5 years preceding publication of
 this notice)........................................
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Note: Former PLP lenders reapplying for PLP status must do so within 180
  days of publication of this notice for this lower threshold to apply.

Paperwork Reduction Act Requirements

    In compliance with the Paperwork Reduction Act (44 U.S.C. 3501-
3520), the approved information collection under OMB control number 
0560-0155 does not change and have any new information collection 
requirements.

Environmental Review

    The environmental impacts have been considered in a manner 
consistent with the provisions of the National

[[Page 13684]]

Environmental Policy Act (NEPA, 42 U.S.C. 4321-4347), the regulations 
of the Council on Environmental Quality (40 CFR parts 1500-1508), and 
the FSA regulation for compliance with NEPA (7 CFR part 799). The 
changes announced in this notice deal with the status of the guaranteed 
lender. Each of the underlying proposals submitted by guaranteed 
lenders of any status will continue to be fully considered under NEPA 
prior to the government guaranteeing any loans for any activities, 
including Categorical Exclusions, Environmental Assessments, or 
Environmental Impact Statements.

Federal Assistance Programs

    The title and number of the Federal assistance programs, as found 
in the Assistance Listing \2\ (formerly referred to as the Catalog of 
Federal Domestic Assistance), to which this document applies is 
10.406--Farm Operating Loans and 10.407--Farm Ownership Loans.
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    \2\ See https://sam.gov/content/assistance-listings.
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USDA Non-Discrimination Policy

    In accordance with Federal civil rights law and USDA civil rights 
regulations and policies, USDA, its agencies, offices, and employees, 
and institutions participating in or administering USDA programs are 
prohibited from discriminating based on race, color, national origin, 
religion, sex, gender identity (including gender expression), sexual 
orientation, disability, age, marital status, family or parental 
status, income derived from a public assistance program, political 
beliefs, or reprisal or retaliation for prior civil rights activity, in 
any program or activity conducted or funded by USDA (not all bases 
apply to all programs). Remedies and complaint filing deadlines vary by 
program or incident.
    Individuals who require alternative means of communication for 
program information (for example, braille, large print, audiotape, 
American Sign Language, etc.) should contact the responsible agency or 
the USDA TARGET Center at (202) 720-2600 (voice and text telephone 
(TTY)) or dial 711 for Telecommunications Relay Service (both voice and 
text telephone users can initiate this call from any telephone). 
Additionally, program information may be made available in languages 
other than English.
    To file a program discrimination complaint, complete the USDA 
Program Discrimination Complaint Form, AD-3027, found online at https://www.usda.gov/oascr/how-to-file-a-program-discrimination-complaint and 
at any USDA office or write a letter addressed to USDA and provide in 
the letter all the information requested in the form. To request a copy 
of the complaint form, call (866) 632-9992. Submit your completed form 
or letter to USDA by: (1) mail to: U.S. Department of Agriculture, 
Office of the Assistant Secretary for Civil Rights, 1400 Independence 
Avenue SW, Washington, DC 20250-9410; (2) fax: (202) 690-7442; or (3) 
email: <a href="/cdn-cgi/l/email-protection#ddadafb2baafbcb0f3b4b3a9bcb6b89da8aeb9bcf3bab2ab"><span class="__cf_email__" data-cfemail="f9898b969e8b9894d790978d98929cb98c8a9d98d79e968f">[email protected]</span></a>.
    USDA is an equal opportunity provider, employer, and lender.

Zach Ducheneaux,
Administrator, Farm Service Agency.
[FR Doc. 2024-03687 Filed 2-22-24; 8:45 am]
BILLING CODE 3411-E2-P


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