An act to extend the Emergency Agricultural Credit Adjustment Act of 1978, and for other purposes.
PL 96-220 (S.2269), enacted 03/30/1980

PUBLIC LAW 96-220—MAR. 30, 1980 
94 STAT. 129 
Public Law 96-220 
96th Congress 
An Act 
To extend the Emergency Agricultural Credit Adjustment Act of 1978, and for other 
purposes. 
Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled. 
SECTION 1. The Emergency Agricultural Credit Adjustment Act of 
1978 (7 U.S.C. prec. 1961 note) is amended by— 
(1)(A) amending clause (C) of section 202 to read as follows: 
"(C) is not able to obtain sufficient credit elsewhere due to 
economic stresses, such as a general tightening of agricultural 
credit or an unfavorable relationship between production costs 
and prices received for agricultural commodities."; and 
(B) in the last sentence of section 202, striking out "and" and 
inserting immediately before the period at the end of the sen-
tence a semicolon and the following: "and the term 'able to 
obtain sufficient credit elsewhere' means able to obtain sufficient 
credit elsewhere to finance the applicant's actual needs at 
reasonable rates and terms, taking into consideration prevailing 
private and cooperative rates and terms in the community in or 
near which the applicant resides for loans for similar purposes 
and periods of time. For the purpose of determining whether an 
applicant under this title is not able to obtain sufficient credit 
elsewhere, the Secretary shall require at least one written 
indication of declination of credit, from a legally organized 
lending institution within reasonable proximity to the applicant, 
that specifies the reasons for the declination: Provided, That for 
loans in excess of $300,000, the Secretary shall require at least 
two such written declinations: Provided further. That for loans of 
$300,000 or less, the Secretary may waive the requirement of this 
sentence if the Secretary determines that it would impose an 
undue burden on the applicant"; 
(2) in section 203(a)(1), inserting before the comma at the end 
thereof a colon and the following: "Provided, That no loan may 
be insured or guaranteed under this title for the purpose of 
refinancing outstanding indebtedness on farm or home real 
estate unless such real estate was purchased by the applicant at 
least one year prior to the date of the loan application"; 
(3) in section 205(d), adding at the end thereof a new sentence 
as follows: "For purposes of carrying out the agreements 
required under clause (2) of the preceding sentence, not later than 
three years after the loan is insured, and not later than at the 
end of every two-year period thereafter for the term of the loan, 
the Secretary shall review the loan; and if, based on such review, 
the Secretary determines that the borrower is able to obtain a 
loan from a credit source specified in clause (2) at reasonable 
rates and terms for loans for similar purposes and periods of 
time, the borrower shall, on request by the Secretary, apply for 
and accept such loan pursuant to the terms of the agreement and 
clause (2)."; 
Mar. 30, 1980 
[S. 2269] 
Emergency 
Agricultural 
Credit 
Adjustment Act 
of 1978, 
extension. 
7 u s e prec. 1961 
note. 
Definition. 
Declination of 
credit, written 
indication. 
7 u s e prec. 1961 
note. 
Loan review. 
7 u s e prec. 1961 
note. 
94 STAT. 130 
PUBLIC LAW 96-220—MAR. 30, 1980 
7 use prec. 1961 
(4) at the end of section 205, adding a new subsection (e) as 
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follows: 
"(e) No loan that is for more than $300,000 may be insured under 
this title, unless the Secretary determines that the applicant is not 
able to obtain from a private or cooperative lending agency a loan 
guaranteed by the Secretary under this title sufficient to finance the 
applicant's actual needs at reasonable rates and terms."; 
7 use prec. 1961 
(5) in section 207(c), striking out "$4,000,000,000" and inserting 
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in lieu thereof "$6,000,000,000"; 
7 use prec. 1961 
(6) in section 211, striking out "May 15, 1980" and inserting in 
"o*«- 
lieu thereof "September 30,1981"; and 
(7) adding at the end thereof a new section 212 as follows: 
"STUDY AND REPORT 
7 use prec. 1961 
"SEC. 212, (a) The Secretary shall conduct a comprehensive study of 
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the operation and effectiveness of the program of financial assistance 
authorized under this title. The study shall include, but shall not be 
limited to, an examination and analysis of the following items: 
"(1) the effect of loans insured or guaranteed under this title on 
the overall financial condition of borrowers and their ability to 
maintain viable agricultural production operations; 
"(2) the implementation and effect of the provisions of this title 
requiring, as a condition of eligibility, that loan applicants not be 
able to obtain sufficient credit elsewhere; 
"(3) the loan repayment delinquency rate and the percentage 
of borrowers who subsequently are able to obtain credit from 
other sources and repay the loans extended to them under this 
title; 
"(4) the use under this title of loan guarantees as compared 
with insured loans; 
"(5) the purposes for which loans are actually insured or 
guaranteed under this title in relation to the purposes specified 
Ante, p. 129. 
in section 203, and an evaluation of the family farm preference 
n
o
V
e ^ P""^^- ^^^^ 
established under section 203(b); 
"(6) the methods of servicing loans and encouraging the repay-
ment of loans insured or guaranteed under this title; and 
"(7) the need for extending beyond September 30, 1981, the 
authority for insuring and guaranteeing loans under this title. 
Report to 
"(b) The Secretary shall complete the study required under this 
eongress. 
section and submit a report to Congress by March 31, 1981. Any 
recommendations by the Secretary for extending the authority to 
insure and guarantee loans under this title shall contain an evalua-
tion of possible alternatives, such as (1) the merger of the program of 
financial assistance authorized under this title with the farm owner-
ship and operating loan programs authorized under the Consolidated 
7 use 1921 
Farm and Rural Development Act, and (2) the combination of all 
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farm loan programs into a single program.". 
PUBLIC LAW 96-220—MAR. 30, 1980 
94 STAT. 131 
SEC. 2. The provisions of sections 1(5), 1(6), and 1(7) of this Act shall Effective dates 
become effective on the date of enactment of this Act. The other ;^^^^ P''^'^- ^^'^^ 
provisions of section 1 of this Act shall become effective upon Regulations, 
promulgation by the Secretary of Agriculture of regulations imple-
menting such provisions within a reasonable time after the date of 
enactment of this Act, but in no event shall such provisions become 
effective later than October 1,1980. 
Approved March 30, 1980. 
LEGISLATIVE HISTORY: 
HOUSE REPORTS: No. 96-782 accompanying H.R. 6291 (Comm. on Agriculture) and 
No. 96-854 (Comm. of Conference). 
SENATE REPORT No. 96-591 (Comm. on Agriculture, Nutrition, and Forestry). 
CONGRESSIONAL RECORD, Vol. 126 (1980): 
Mar. 4, considered and passed Senate. 
Mar. 5, H.R. 6291 considered and passed House; passage vacated and S. 2269, 
amended, passed in lieu. 
Mar. 26, Senate agreed to conference report. 
Mar. 27, House agreed to conference report. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 16, No. 14: 
Mar. 30, Presidential statement.