Dallas P. Tonsager, Chairman and Chief Executive Officer

Jeffery S. Hall, Board Member

Kenneth A. Spearman, Board Member (by telephone)

MINUTES OF THE REGULAR MEETING

OF THE

FARM CREDIT ADMINISTRATION BOARD

January 12, 2017 

These minutes reflect the business transacted at the January 12, 2017, Regular Meeting of the Farm 

Credit Administration Board (FCA Board) pursuant to the Government in the Sunshine Act (Act), 5 

U.S.C. § 552b, and the regulations of the Farm Credit Administration (FCA) adopted thereunder.

The FCA Board meeting was held at the FCA office in McLean, Virginia, beginning at 9:00 a.m. and 

concluding at 9:33 a.m. Members of the Board present were:

Dallas P. Tonsager, Chairman and Chief Executive Officer

Jeffery S. Hall, Member

Kenneth A. Spearman, Member (by telephone)

The above named constitute the full Board. 

Others present included Charles Rawls, General Counsel; Dale Aultman, Secretary to the Board; staff 

of the FCA and Farm Credit System Insurance Corporation (FCSIC); and two members of the general 

public. (A list of staff attendees is attached as Exhibit A.) 

The Secretary read a statement that announced the meeting would be conducted according to the 

requirements of the Government in the Sunshine Act. 

The Board Chairman reviewed the published Agenda. (A copy of the Public Announcement 

publishing the Agenda for the meeting is attached as Exhibit B.)

Mr. Hall moved to adopt the Agenda as published. 

Mr. Spearman seconded the motion.

1
There being no further discussion, Board Chairman Tonsager called the question.

The Secretary polled the Board Members and the motion carried unanimously.

Mr. Spearman noted that the Agenda did include portions of the meeting that should be closed to 

the public as permitted by the Government in the Sunshine Act and therefore moved that the 

meeting be closed at that point. 

Mr. Hall seconded the motion.

There being no further discussion, Board Chairman Tonsager called the question.

The Secretary polled the Board Members and the motion carried unanimously.

OPEN SESSION

Approval of Minutes

Minutes for December 8, 2016 

(BM-12-JAN-17-01) 

Mr. Hall moved to approve the minutes for December 8, 2016, FCA Regular Board Meeting. 

Mr. Spearman seconded the motion.

There being no further discussion, Board Chairman Tonsager called the question.

The Secretary polled the Board Members and the motion carried unanimously. (BM-12-JAN-17-01) 

(A copy of the official “Board Action Item” is attached as Exhibit C.)

New Business

Draft Third Amended and Restated Market Access Agreement to be entered into by the Farm Credit 

System Banks and the Federal Farm Credit Banks Funding Corporation

(BM-12-JAN-17-02) 

David Lewandrowski of the Office of Regulatory Policy and Rebecca Orlich of the Office of General 

Counsel presented the Draft Third Amended and Restated Market Access Agreement to be entered 

into by the Farm Credit System Banks and the Federal Farm Credit Banks Funding Corporation.

Board Chairman Tonsager opened the discussion for questions by the Board.

Board Chairman Tonsager asked if there was any further discussion and asked staff to provide their 

recommendation. Staff provided their recommendation. 

2
Board Chairman Tonsager called for a motion on the staff’s recommendation regarding the proposed

agreement. 

Mr. Spearman moved that the Board approve the Draft Third Amended and Restated Market Access

Agreement to be entered into by the Farm Credit System Banks and the Federal Farm Credit Banks 

Funding Corporation.

Mr. Hall seconded the motion.

Board Chairman Tonsager asked if there was any further discussion.

There being no further discussion, the Board Chairman called the question.

The Secretary polled the Members and the motion carried unanimously. (BM-12-JAN-17-02)

(A copy of the “Board Action Item” is attached as Exhibit D.)

Reports

Auditor’s Report on FCA FY 2016/2015 Financial Statements

Elizabeth Dean, Inspector General, and auditors Matthew Farage and Joseph Fletcher from Harper, 

Rains, Knight, and Company presented the Auditor’s Report on FCA FY 2016/2015 Financial 

Statements.

Board Chairman Tonsager asked if there were any questions or further discussion from the Board. 

There were no further questions or discussion. 

(A copy of the PowerPoint presentation is attached as Exhibit E.)

CLOSED SESSION

The Board Chairman noted that this was a Closed Session and ensured that nonessential staff were 

not in the room so the Board could meet in Executive Closed Session with the Auditors. 

Board Chairman Tonsager convened the closed session of the meeting at 9:23 a.m. and instructed 

the Secretary to activate the electronic recording device so that the proceedings of the closed 

session were properly recorded as required by the Government in the Sunshine Act. 

The Board Chairman then instructed the General Counsel to furnish the Secretary with a 

certification, pursuant to 5 U.S.C. § 552b(f), that the portions of the meeting held in closed session 

may be properly closed to the public. 

(A copy of the Certification is attached hereto as Exhibit F.) 

3
Members of the Board present were:

Dallas P. Tonsager, Chairman and Chief Executive Officer

Jeffery S. Hall, Board Member

Kenneth A. Spearman, Board Member (by telephone)

The above named constitute the full Board. 

Others present included Dale Aultman, Secretary to the Board; and Charles Rawls, General Counsel. 

(A list of staff attendees is attached as Exhibit A).

Executive Meeting with Auditors

The Board met in executive session with Auditors from Harper, Rains, Knight, and Company. 

Board Chairman Tonsager asked if there were any questions or further discussion from the Board. 

There were no further questions or discussion.

ADJOURNMENT

There being no further business to come before the Board, Board Chairman Tonsager indicated he 

would entertain a motion to adjourn the meeting.

Mr. Hall moved that the meeting be adjourned.

Mr. Spearman seconded the motion.

Board Chairman Tonsager called the question. 

The Secretary polled the Board Members and the motion carried unanimously.

The meeting adjourned at 9:33 a.m.

4
NOTATIONAL VOTE ACTIONS 

There were four notational vote actions approved by the FCA Board from December 9, 2016, through 

January 11, 2017 as follows:

Item Number Action Date Voting Results Subject

NV 16-24 12/12/2016 Approved 2017 Compensation and Benefits Program

NV 16-25 12/22/2016 Approved Bookletter-068: Tier 1/Tier 2 Capital Framework Guidance

NV 17-01 01/10/2017 Approved AgStar, ACA Request to Invest in Bonds to be issued by a longterm care facility, with conditions

NV 17-02 01/11/2017 Approved Inflation Adjustment to Civil Money Penalties Regulation

The undersigned hereby certify that the foregoing minutes are the official minutes of the Regular 

Meeting of the Farm Credit Administration Board held on January 12, 2017. 

__________/s/_______________ __________/s/_______________

Dallas P. Tonsager Dale L. Aultman

Chairman and Chief Executive Officer Secretary to the Board

 Approved: _February 9, 2017__

5
Exhibit A

Page 1 of 2

STAFF PRESENT AT THE 

FCA REGULAR BOARD MEETING

January 12, 2017

Dallas P. Tonsager, Chairman and Chief Executive Officer

Jeffery S. Hall, Board Member

Kenneth A. Spearman, Board Member (by telephone)

OFFICE

OPEN 

SESSION

CLOSED 

EXECUTIVE

SESSION

Office of the Board

Aultman, Dale X X

Middleton, Russell X X

Laguarda, Wendy X X

Buccolo, Debra X

Corey, Kathryn X

Kramp, Kevin X X

Calhoun, Gaye X

EEOI

Burlew, Thais X

COO

Hoffman, William X

OIT

Golley, Jerald X

OCPA

Stokke, Mike X

Batta, Todd X

Meaux, Willy X

OSMO

Rea, Laurie X

OGC

Rawls, Charles X X

Strickland, Joy X

Orlich, Rebecca X

Donner, Mary Alice X

6
Exhibit A

Page 2 of 2

OFFICE OPEN 

SESSION

CLOSED 

SESSION

OE

Coleman, Robert X

Paulsen, Roger X

OIG

Dean, Elizabeth X X

Kaufman, Tori X

AUDITORS

Farage, Matthew (Harper, Rains, Knight and Company) X X

Fletcher, Joseph (Harper, Rains, Knight and Company) X X

ORP

Van Meter, Gary X

Mardock, Barry X

Lewandrowski, David X

OCFO

Smith, Stephen X

Gandy, Douglas X

Soares, Ily X

OAS

 McCain, Veronica X

FCSIC

Pfitzinger, Rick X

GENERAL PUBLIC 2

7
Exhibit B 

Farm Credit Administration Farm Credit Administration

 1501 Farm Credit Drive McLean, Virginia 22102-5090

 

PUBLIC ANNOUNCEMENT OF

MEETING SUBJECT TO THE GOVERNMENT IN THE SUNSHINE ACT

Farm Credit Administration Board

Regular Meeting

January 12, 2017 

Summary: Notice is hereby given, pursuant to the Government in the Sunshine Act (5 U.S.C. Sec. 552b (e) (1)), of the 

forthcoming regular meeting of the Farm Credit Administration Board.

Date and Time: The regular meeting of the Board will be held January 12, 2017. The meeting is scheduled to be held at 

the office of the Farm Credit Administration in McLean, Virginia, from 9:00 a.m. until such time as the Board may 

conclude its business.

Address: Farm Credit Administration, 1501 Farm Credit Drive, McLean, Virginia 22102-5090. Submit attendance 

requests via e-mail to VisitorRequest@FCA.gov. See SUPPLEMENTARY INFORMATION for further information about 

attendance requests. 

For Further Information Contact: Dale L. Aultman, Secretary to the Farm Credit Administration Board (703) 883-4009. 

TTY is (703) 883-4056.

Supplementary Information: Parts of this meeting of the Board will be open to the public (limited space available), and 

parts will be closed to the public. Please send an e-mail to VisitorRequest@FCA.gov at least 24 hours before the meeting. 

In your e-mail include: name, postal address, entity you are representing (if applicable), and telephone number. You will 

receive an e-mail confirmation from us. Please be prepared to show a photo identification when you arrive. If you need 

assistance for accessibility reasons, or if you have any questions, contact Dale L. Aultman, Secretary to the Farm Credit 

Administration Board, at (703) 883-4009. The matters to be considered at the meeting are:

OPEN SESSION

Approval of Minutes

1 December 8, 2016 

New Business

2 Draft Third Amended and Restated Market Access Agreement to be entered into by the Farm Credit System Banks 

and the Federal Farm Credit Banks Funding Corporation

Reports

 3 Auditor’s Report on FCA FY 2016/2015 Financial Statements

CLOSED SESSION

4 Executive Meeting with Auditors1

_ December 30, 2016_______ __________/s/_______________

 Date Dale L. Aultman

 Secretary to the Board

 

1 Session Closed-Exempt pursuant to 5 U.S.C. Section 552b(c)(2).

8
Exhibit C 

Farm Credit Administration 1501 Farm Credit Drive

 McLean, Virginia 22102-5090

 (703) 883-4000

BOARD ACTION ITEM

 

FCA BOARD ACTION ON

Minutes for December 8, 2016 Board Meeting

BM-12-JAN-17-01

Effective Date: January 12, 2017

Effect on Previous Action: None

THE FCA BOARD HEREBY:

 

Approves the minutes for December 8, 2016, Regular Board Meeting as submitted.

DATED THIS 12th DAY OF JANUARY 2017 

BY ORDER OF THE BOARD

 

__________/s/_______________

Dale L. Aultman

Secretary to the Board 

9
Exhibit D 

Farm Credit Administration 1501 Farm Credit Drive

 McLean, Virginia 22102-5090

 (703) 883-4000

BOARD ACTION ITEM

 

FCA BOARD ACTION ON

Draft Third Amended and Restated Market Access Agreement to be entered into by 

the Farm Credit System Banks and the Federal Farm Credit Banks Funding Corporation

BM-12-JAN-17-02 

Effective Date: January 12, 2017 

Effect on Previous Action: The Draft Third Restated MAA, when entered into, would replace the 

existing second restated MAA approved by the FCA Board in December 2011.

THE FCA BOARD HEREBY: 

• Approves the Draft Third Amended and Restated Market Access Agreement (Draft 

Third Restated MAA); 

• Adopts the Draft Federal Register notice and authorizes staff to make any technical or 

grammatical changes to the notice that may be necessary before publication in the 

Federal Register; and

• Approves notification of its approval of the Draft Third Restated MAA to the Federal 

Farm Credit Banks Funding Corporation substantially in the form of the approved 

draft letter.

DATED THIS 12th DAY OF JANUARY 2017

BY ORDER OF THE BOARD

__________/s/_______________

Dale L. Aultman

Secretary to the Board 

10
Farm Credit 

Administration

Fiscal Year 2016 

Financial Statements Audit

11 Exhibit E
Opinion on FCA’s FY 2016 Financial Statements

Unmodified Opinion

Report on FCA’s Internal Controls over Financial Reporting

No opinion issued

No significant deficiencies or material weaknesses identified

Report on FCA’s Compliance and Other Matters

No opinion issued

No instances of non-compliance identified

12 Exhibit E
Key Audit Areas:

• Payroll Expenditures (82% of total expenditures)

• Investments (93% of total assets)

• Assessments

Methodology:

• Reliance on controls at service providers

• Testing of controls in place at FCA 

• Interim and yearend substantive testing

13 Exhibit E
Financial Statement Analysis: 

• Balance Sheet –Line Items were materially consistent with prior year 

with the exception of Capitalized Assets and Deferred Revenue. 

14 Exhibit E
Financial Statement Analysis – Cont’d: 

• Balance Sheet – Cont’d

• General property and equipment increased as FCA added new 

laptops in FY2016. Additionally, general property and equipment 

increased as FCA developed Internal-Use Software Projects that are 

currently in development but are not yet operational.

• Deferred revenue consists of collections of Fiscal Year 2017 

assessments received before September 30, 2016. The increase 

occurred predominantly because of one of the larger institutions 

issued payment of assessment in September. 

15 Exhibit E
Financial Statement Analysis – Cont’d: 

• Statement of Net Cost – Gross Costs increased due to Public 

Mission and Safety and Soundness Program cost seeing an increase 

of $3 million and $2 million in FY16, respectfully.

16 Exhibit E
Financial Statement Analysis – Cont’d: 

• Statement of Net Cost – Cont’d

• Earned Revenues increased $7 million, consistent with current year 

assessments and budgeted amounts.

17 Exhibit E
Financial Statement Analysis – Cont’d: 

• Statement of Changes in Net Position – Other Financing Sources 

were materially consistent with prior year. 

• Decrease in Net Position due to increase spending in Public Mission 

and Safety and Soundness, as presented on Statement of Net Cost.

18 Exhibit E
Financial Statement Analysis – Cont’d: 

• Statement of Budgetary Resources – Only significant change in 

FY2016 was the increase in Obligations Incurred, which is in line with 

the overall increase in Net Cost of Operations.

19 Exhibit E
~ Thank You ~

Inspector General and Staff

&

Chief Financial Officer and Staff

20 Exhibit E
Exhibit F 

Farm Credit Administration 1501 Farm Credit Drive McLean, Virginia 22102-5090

 

 

CERTIFICATE OF CLOSED MEETING

The General Counsel, in accordance with the Government in the Sunshine Act, 5 U.S.C. § 552b(f)(1), 

hereby certifies that the Farm Credit Administration Board regular meeting of January 12, 2017, was 

properly closed to the public on the basis of the exemption set forth below:

• Information related solely to the internal practices of an Agency – 5 U.S.C. 

§552b(c)(2).

 

 __________/s/_______________ Date: January 12, 2017 

 Charles R. Rawls

General Counsel 

21