483 
lowest actual or county average yield for the farm 
from the calculation, if the farmer was affected by 
a natural or major disaster or emergency during at 
least 2 of the crop years during the period. 
‘‘(2) AFFECTED BY A NATURAL OR MAJOR DIS-
ASTER OR EMERGENCY.—A farmer was affected by 
a natural or major disaster or emergency under 
paragraph (1) if the Secretary finds that the farm-
ing operations of the farmer have been substantially 
affected by a natural or major disaster or emer-
gency, including a farmer who has a qualifying loss 
but is not located in a designated or declared dis-
aster area. 
‘‘(3) APPLICATION OF SUBSECTION.—This sub-
section shall apply to any action taken by the Sec-
retary that involves— 
‘‘(A) a loan under chapter 1 or 2; and 
‘‘(B) the yield of a farm of a farmer, in-
cluding making a loan or loan guarantee, serv-
icing a loan, or making a credit sale. 
‘‘SEC. 3406. SPECIAL CONDITIONS AND LIMITATIONS ON 
LOANS. 
‘‘(a) APPLICANT
REQUIREMENTS.—In connection 
with a loan made or guaranteed under this subtitle, the 
Secretary shall require— 
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‘‘(1) the applicant— 
‘‘(A) to certify in writing that, and the 
Secretary shall determine whether, the appli-
cant is unable to obtain credit elsewhere; and 
‘‘(B) to furnish an appropriate written fi-
nancial statement; 
‘‘(2) except for a guaranteed loan, an agree-
ment by the borrower that if at any time it appears 
to the Secretary that the borrower may be able to 
obtain a loan from a production credit association, 
a Federal land bank, or other responsible coopera-
tive or private credit source (or, in the case of a bor-
rower under section 3106, the borrower may be able 
to obtain a loan under section 3101), at reasonable 
rates and terms for loans for similar purposes and 
periods of time, the borrower will, on request by the 
Secretary, apply for and accept the loan in a suffi-
cient amount to repay the Secretary or the insured 
lender, or both, and to pay for any stock necessary 
to be purchased in a cooperative lending agency in 
connection with the loan; 
‘‘(3) such provision for supervision of the oper-
ations of the borrower as the Secretary shall con-
sider necessary to achieve the objectives of the loan 
and protect the interests of the United States; and 
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485 
‘‘(4) the application of a person who is a vet-
eran for a loan under chapter 1 or 2 to be given 
preference over a similar application from a person 
who is not a veteran if the applications are on file 
in a county or area office at the same time. 
‘‘(b) AGENCY PROCESSING REQUIREMENTS.— 
‘‘(1) NOTIFICATIONS.— 
‘‘(A) INCOMPLETE APPLICATION NOTIFICA-
TION.—If an application for a loan or loan 
guarantee under this subtitle (other than an op-
erating loan or loan guarantee) is incomplete, 
the Secretary shall inform the applicant of the 
reasons the application is incomplete not later 
than 20 days after the date on which the Sec-
retary has received the application. 
‘‘(B) OPERATING LOANS.— 
‘‘(i) 
ADDITIONAL
INFORMATION 
NEEDED.—Not later than 10 calendar 
days after the Secretary receives an appli-
cation for an operating loan or loan guar-
antee, the Secretary shall notify the appli-
cant of any information required before a 
decision may be made on the application. 
‘‘(ii) INFORMATION NOT RECEIVED.— 
If, not later than 20 calendar days after 
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the date a request is made pursuant to 
clause (i) with respect to an application, 
the Secretary has not received the informa-
tion requested, the Secretary shall notify 
the applicant and the district office of the 
Farm Service Agency, in writing, of the 
outstanding information. 
‘‘(C) REQUEST INFORMATION.— 
‘‘(i) IN GENERAL.—On receipt of an 
application, the Secretary shall request 
from other parties such information as 
may be needed in connection with the ap-
plication. 
‘‘(ii) INFORMATION FROM AN AGENCY 
OF THE DEPARTMENT.—Not later than 15 
calendar days after the date on which an 
agency of the Department receives a re-
quest for information made pursuant to 
subparagraph (A), the agency shall provide 
the Secretary with the requested informa-
tion. 
‘‘(2) REPORT OF PENDING APPLICATIONS.— 
‘‘(A) IN GENERAL.—A county office shall 
notify the district office of the Farm Service 
Agency of each application for an operating 
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loan or loan guarantee that is pending more 
than 45 days after receipt, and the reasons for 
which the application is pending. 
‘‘(B) 
ACTION
ON
PENDING
APPLICA-
TIONS.—A district office that receives a notice 
provided under subparagraph (A) with respect 
to an application shall immediately take steps 
to ensure that final action is taken on the appli-
cation not later than 15 days after the date of 
the receipt of the notice. 
‘‘(C) PENDING
APPLICATION
REPORT.— 
The district office shall report to the State of-
fice of the Farm Service Agency on each appli-
cation for an operating loan or loan guarantee 
that is pending more than 45 days after receipt, 
and the reasons for which the application is 
pending. 
‘‘(D) 
REPORT
TO
CONGRESS.—Each 
month, the Secretary shall notify the Com-
mittee on Agriculture of the House of Rep-
resentatives and the Committee on Agriculture, 
Nutrition, and Forestry of the Senate, on a 
State-by-State basis, as to each application for 
an operating loan or loan guarantee on which 
final action had not been taken within 60 cal-
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endar days after receipt by the Secretary, and 
the reasons for which final action had not been 
taken. 
‘‘(3) DISAPPROVALS.— 
‘‘(A) IN GENERAL.—If an application for a 
loan or loan guarantee under this subtitle is 
disapproved by the Secretary, the Secretary 
shall state the reasons for the disapproval in 
the notice required under paragraph (1). 
‘‘(B) DISAPPROVAL
DUE
TO
LACK
OF 
FUNDS.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
paragraph (1), each application for a loan 
or loan guarantee under section 3601(e), 
or for a loan under section 3501(a) or 
3502(a), that is to be disapproved by the 
Secretary solely because the Secretary 
lacks the funds necessary to make the loan 
or guarantee shall not be disapproved but 
shall be placed in pending status. 
‘‘(ii) RECONSIDERATION.—The Sec-
retary shall retain each pending application 
and reconsider the application beginning 
on the date that sufficient funds become 
available. 
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