Farm Credit Banks and Associations Safety and Soundness Act of 1992
PL 102-552 (H.R.6125), enacted 10/28/1992

106 STAT. 4102 
PUBLIC LAW 102-552—OCT. 28, 1992 
Public Law 102-552 
102d Congress 
An Act 
Oct. 28, 1992 
[H.R. 6125] 
Farm Credit 
Banks and 
Associations 
Safety and 
Soundness Act 
of 1992. 
12 u s e 2001 
(
S note. 
To enhance the financial safety and soundness of the banks and associations of 
the Farm Credit System, 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. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act mav be cited as the "Farm Credit 
Banks and Associations Safety and Soundness Act of 1992". 
(b) TABLE OF CONTENTS.—The table of contents of this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. References to the Farm Credit Act of 1971. 
TITLE I—IMPROVEMENTS TO FARM CREDIT SYSTEM SAFETY AND 
SOUNDNESS 
Sec. 101. Definition of permanent capital. 
Sec. 102. Qualifications of Farm Credit Administration Board members. 
TITLE II—FARM CREDIT SYSTEM INSURANCE CORPORATION 
Sec. 201. Farm Credit System Insurance Corporation. 
Sec. 202. Statutory successor to Assistance Board agreements. 
Sec. 203. Use of Farm Credit Administration personnel. 
Sec. 204. GAO reports on risk-based insurance premiums, access to association cap-
ital, supplemental premiums, and consolidation. 
TITLE III—REPAYMENT OF FARM CREDIT SYSTEM DEBT OBLIGATIONS 
Sec. 301. Capital preservation. 
Sec. 302. Preferred stock. 
-^ 
Sec. 303. Systemwide repajnnaent obligation. 
Sec. 304. Repayment of Treasury-paid interest. 
Sec. 305. Transfer of obligations from associations to banks; other matters. 
Sec. 306. Defaults. 
Sec. 307. Authority of Financial Assistance Corporation. 
Sec. 308. Techniccu amendments. 
TITLE IV—CLARIFICATION OF CERTAIN AUTHORITIES 
Sec. 401. Clarification of the status and powers of certain institutions of the Farm 
Credit System. 
TITLE V—MISCELLANEOUS 
Sec. 501. Valuation reserves of production credit associations. 
Sec. 502. Risk mani^ment participation authority. 
Sec. 503. Eqmty voting for one director of each bank for cooperatives. 
Sec. 504. Technical amendment. 
Sec. 505. Expansion of water and sewer lending authority of banks for cooperatives. 
Sec. 506. Eligibility to borrow from a bank for cooperatives. 
Sec. 507. Non-voting representative on board of Funding Corporation. 
Sec. 508. Repeal of prohibition against guarantee of certain instruments of indebt-
edness. 
Sec. 509. Compensation of bank directors. 
Sec. 510. Clarification of treatment of Farm Credit Administration operating ex-
penses. 
Sec. 511. Approval of competitive charters. 
Sec. 512. Examinations. 
Sec. 513. Authority to examine System institutions. 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4103 
Sec. 514. Financial disclosiire and conflict of interest reporting by directors, offi-
cers, and employees of Farm Credit System institutions. 
Sec. 515. One-time EFAP assistance. 
Sec. 516. Technical corrections. 
SEC. 2. REFERENCES TO THE FARM CREDIT ACT OF 1971. 
Whenever in this Act an amendment or repeal is expressed 
in terms of an amendment to, or repeal of, a section or other 
provision, the reference shall be considered to be made to a section 
or other provision of the Farm Credit Act of 1971 (12 U.S.C. 2001 
et seq.), except to the extent otherwise provided. 
TITLE 
I—IMPROVEMENTS 
TO 
FARM 
CREDIT SYSTEM SAFETY AND SOUND-
NESS 
SEC. 101. DEFINITION OF PERMANENT CAPITAL. 
Paragraph (1) of section 4.3A(a) (12 U.S.C. 2154a(aXl)) is 
amended to read as follows: 
"(1) PERMANENT CAPITAL.—The term 'permanent capital' 
means— 
"(A) current year retained earnings; 
"(B) allocated and unallocated earnings (which, in the 
case of earnings allocated in any form by a System bank 
to any association or other recipient and retained by the 
bank, shall be considered, in whole or in part, permanent 
capital of the bank or of any such association or other 
recipient as provided under an agreement between the 
bank and each such association or otifier recipient); 
"(C) all surplus (less allowances for losses); 
"(D) stock issued by a System institution, except— 
"(i) stock that may be retired by the holder of 
the stock on repayment of the holder's loan, or other-
wise at the option or request of the holder; or 
"(ii) stock that is protected under section 4.9A 
or is otherwise not at risk; and 
"(E) any other debt or equity instnunents or other 
accounts that the Farm Credit Administration determines 
appropriate to be considered permanent capital.". 
SEC. 102. QUALIFICATIONS 
OF FARM CREDIT 
ADMINISTRATION 
BOARD MEMBERS. 
Section 5.8 (12 U.S.C. 2242) is amended by adding at the 
end the following new subsection: 
"(e) The President shall appoint members of the Board who— President. 
"(1) are experienced or knowledgeable in agricultural 
economics and financial reporting and dieclosure; 
"(2) are experienced or knowledgeable in the regulation 
of financial entities; or 
'X3) have a strong financial, legal, or regulatory back-
groimd.". 
106 STAT. 4104 
PUBLIC LAW 102-552—OCT. 28, 1992 
TITLE II—FARM CREDIT SYSTEM 
INSURANCE CORPORATION 
SEC. 201. FARM CREDIT SYSTEM INSURANCE CORPORATION. 
(a) IN GENERAL.—Section 5.53 (12 U.S.C. 2277a-2) is amended 
to read as follows: 
*«EC. SJ». BOARD OF DIRECTORS. 
"(a) IN GENERAL.— 
**(1) ESTABLISHMENT.—^The management of the Corporation 
shall be vested in a Board of Directors (referred to in this 
section as the 'Bosird'). The Board shall establish policies for 
the Corporation. The Board shall provide for the performance 
of all the powers and duties vested in the Corporation. 
"(2) APPOINTMENT.—^The Board shall consist of three mem-
bers, who shall be citizens of the United States and broadly 
President. 
representative of the public interest. Members of the Board 
shall be appointed by the President, by and with the advice 
and consent of the Senate. Not more than two members of 
the Board shall be members of the same political party. 
President. 
«(3) CHAIRPERSON.—Of the persons appointed to the Board, 
one shall be designated by the President to serve as Chair-
person of the Board for the duration of the term of the member. 
"(4) P
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.
—
A member of the 
Board shall be ineligible during the time the member is in 
office and for 2 years thereafter to hold any office, position, 
or emplojonent in any institution of the Farm Credit System, 
"(b) TERM O
F OFFICE.— 
"(1) IN GENERAL.—^The term of ofiice of each member of 
the Board shall be 6 years, except that the terms of the two 
members, other than the Chairperson, first appointed under 
subsection (a) shall expire, one on the expiration of 2 years 
after the date of appointment, and one on the expiration of 
4 years after the date of appointment. 
"(2) SUCCESSION.—Members of the Board shall not be 
appointed to succeed themselves, except that the members first 
appointed under subsection (a) for a term of less than 6 years 
may be reappointed for a full 6-year term and members 
appointed to fill imexpired terms of 3 years or less may be 
reappointed for a full 6-year term. 
"(S) VACANCIES.—Any vacancy shall be filled for the 
unexpired term on like appointment. Any member of the Board 
shall continue to serve as a member after the expiration of 
the term of the member until a successor has been appointed 
and qualified. 
*
*
(
c
) ORGANIZATION.— 
"(1) OATH.—^Each member of the Board, within 15 days 
after notice of appointment, shall subscribe to the oath of 
office. 
"(2) QUORUM.—^The Board may transact business if a 
vacancy exists, if a quorum is present. A quorum shall consist 
of two members of the Board. 
"(3) MEETING.—^The Board shall hold meetings at such 
times and places as the Board may fix and determine. The 
meetings shall be held on the call of the Chairperson or any 
- 
two Board members. 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4105 
"(4) RULES; RECORDS.—The Board shall adopt such rules 
as the Board considers appropriate for the transaction of busi-
ness by the Board, and shall keep permanent and accurate 
records and minutes of the actions and proceedings of the 
Board. 
"(d) COMPENSATION.— 
"(1) IN GENERAL.—The members of the Board shall devote 
their fall time and attention to the business of the Board. 
''(2) CHAIRPERSON.—The Chairperson of the Board shall 
receive compensation at the rate prescribed for level III of 
the Executive Schedule under section 5314 of title 5, United 
States Code. 
%3) OTHER MEMBERS.—Each of the other members of the 
Board shall receive compensation at the rate prescribed for 
level IV of the Executive Schedule under section 5315 of title 
5, United States Code. 
"(4) EXPENSES.—Each member of the Board shall be 
reimbursed for necessary travel, subsistence, and other 
expenses in the discharge of the official duties of the member 
without regard to other laws with respect to allowance for 
travel and subsistence of officers and employees of the United 
States.". 
(b) CONFORMING AMENDMENTS.— 
(1) CHAIRPERSON.—Section 5314 of title 5, United States 
Code, is amended by adding at the end the following new 
item: 
"Chairperson, Board of Directors of the Farm Credit System 
Insurance Corporation.". 
(2) MEMBERS.—Section 5315 of such title is amended by 
adding at the end the following new item: 
"Members, Board of Directors of the Farm Credit System 
Insurance Corporation.". 
(c) EFFECTIVE DATE.— 
12 use 2277a-2 
(1) IN GENERAL.—^The amendments made by this section 
shall become effective on January 1,1996. 
(2) TRANSITIONAL PROVISION.—The Board of Directors of 
the Farm Credit System Insurance Corporation as established 
by section 5.53 of the Farm Credit Act of 1971 (12 U.S.C. 
2277a-2) (as it existed before the amendments made by sub-
section (a) of this section) shall continue in existence and con-
tinue to manage the Farm Credit System Insurance Corporation 
until at least two members are appointed by the President, 
by and with the advice and consent of the Senate, to the 
new Board established by section 5.53 of such Act (as amended 
by subsection (a) of this section). 
SEC. 202. STATUTORY SUCCESSOR TO ASSISTANCE BOARD AGREE-
BfENTS. 
(a) IN GENERAL.—Section 5.58(2) (12 U.S.C. 2277a-7(2)) is 
amended by adding at the end the following new sentence: "The 
Corporation shall succeed to the rights of the Farm Credit System 
Assistance Board under agreements between the Farm Credit Sys-
tem Assistance Board and System institutions certifying the institu-
tions as eligible to issue preferred stock pursuant to title VI on 
the termination of the Assistance Board on the date provided in 
section 6.12.". 
note. 
106 STAT. 4106 
PUBLIC LAW 102-552—OCT. 28, 1992 
(b) CONFORMING AMENDMENTS.—Section 5.35(4) (12 U.S.C. 
2271(4)) is amended— 
(1) by striking ''and" at the end of subparagraph (A); 
(2) by striking the period at the ena of subparagraph (B) 
and inserting "; and"; and 
(3) by adding at the end the following new subparagraph: 
"(C) after December 31, 1992, mean any significant 
noncompliance by a System institution (as determined by 
the Farm Credit Administration, in consultation with the 
Farm Credit System Insurance Corporation) with any term 
I 
: 
or condition imposed on the institution by the Farm Credit 
System Assistance Board imder section 6.6 or by the Farm 
Credit System Insursince Corporation under section 5.61.". 
SEC. 203. USE OF FARM CREDIT ADMINISTRATION PERSONNEL. 
Section 5.59(a) (12 U.S.C. 2277a-8(a)) is amended by adding 
at the end the following new paragraph: 
"(5) USE OF FARM CREDIT ADMINISTRATION PERSONNEL.— 
To the extent practicable, the Corporation shall use the per-
sonnel and resources of the Farm Credit Administration to 
minimize duplication of effort and to reduce costs.". 
12 use 2277a-4 
SEC. 204. GAO REPORTS ON RISK-BASED INSURANCE PREMIUMS, 
note. 
ACCESS TO ASSOCIATION CAPITAL, SUPPLEMENTAL PRE-
MIUMS, AND CONSOLIDATION. 
(a) IN GENERAL.—The Comptroller CJeneral of the United States 
shall investigate, review, and evaluate the feasibility and appro-
priateness, and report to the Committee on Agriculture of the 
House of Representatives and the Committee on Agriculture, Nutri-
tion, and Forestry of the Senate, on the advantages and disadvan-
tages of providing the Farm Credit System Insurance Corporation 
with— 
(1) the authority to directly or indirectly assess associations 
to ensure that all System capital is available to prevent losses 
to investors, including a study o
f
— 
(A) the effects of direct assessments by the Insurance 
Corporation on associations, including interest rate charges 
to borrowers; 
(B) the effects of requiring that banks pass along the 
cost of insurance premiums to owner associations and other 
financing institutions having a discount relationship with 
the bank; 
(C) the effects of requiring owner associations to pur-
chase stock in the district bank, if needed, to prevent 
a bank from having to retiun to the Insurance Corporation 
for financial assistance once the assistance has been given; 
(D) the effects of the purchase of stock from funds 
of the association (through nmds obtained from other than 
the district bank) or allowing the bank to increase the 
direct line of credit to the association in order to fund 
the purchase; and 
(E) the effect that authorizing the Insurance Corpora-
tion to assess the association could have on the association's 
incentives for building capital; 
(2) the authority to collect supplemental insurance pre-
miums under certain circimistances, including a study o
f
— 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4107 
^ . 
(A) the possibility of the Insurance Fund being depleted 
more rapidly than it could be replenished under the current 
premium structure; 
(B) the effects of the depletion under alternate eco-
nomic scenarios and the probabiUty of the occurrence of 
each of those scenarios; 
(C) the effects on capital accumulation and interest 
rates of levering a supplemental premium; and 
(D) limitations on any authority to levy supplemental 
premiums and the underlying basis for the umitations; 
and 
(3) the authority to establish an insurance premium rate 
structure that would take into account, on an mstitution-by-
institution basis, asset quality risk, interest rate risk, earnings, 
and capital. 
(b) REPORT ON CONSOLIDATION.— 
(1) IN GENERAL.—The Comptroller General of the United 
States shall evaluate and report to the Committee on Agri-
culture of the House of Representatives and the Committee 
on Agriculture, Nutrition, and Forestry of the Senate on 
whether there are likely to be benefits to farmer and rancher 
borrowers of the Farm Credit System institutions of merging 
the 10 district Farm Credit Banks (and the Federal Intermedi-
ate Credit Bank of Jackson) into fewer regional Farm Credit 
Banks. 
(2) FACTORS.—In preparing the report, the Comptroller 
General shall consider— 
(A) the potential reduction in services to farmers and 
ranchers; 
(B) the potential benefits of jointly providing services 
to farmers and ranchers among these proposed regional 
districts; 
(C) any economy of scale effects on a district-by-district 
basis; 
(D) the potential impact on the cooperative nature 
of the Farm Cfredit Svstem; 
(E) the potential impact on bank and association rela-
tionships; and 
(F) the potential impact on System-wide bond 
issuances. 
(c) POTENTIAL SAVINGS.—The Comptroller General of the 
United States shall evaluate and report to the appropriate commit-
tees of Congress on the potential savings to the Farm Credit System 
and its shareholders that might occur if System institutions and 
the Farm Credit Administration were required to comply with Gen-
eral Services Administration standards for office space, furniture, 
and equipment. 
(d) DEADLINE.—^The reports required under this section shall 
be provided to Congress not later than 12 months after the date 
of enactment of this Act. 
TITLE III—REPAYMENT OF FARM 
CREDIT SYSTEM DEBT OBLIGATIONS 
SEC. 301. CAPITAL PRESERVATION. 
Section 6.9(eX3) (12 U.S.C. 2278a-9(eX3)) is amended— 
106 STAT. 4108 
PUBLIC LAW 102-552—OCT. 28, 1992 
(1) by striking subparagraph (C) and inserting the following 
new subparagraph: 
"(C) PAYMENT OF PRINCIPAL.— 
"(i) IN GENERAL.—After the end of the 15-year 
period beginning on the date of the issuance of any 
obligation issued to carry out this subsection, the banks 
operating under this Act shall pay to the Financial 
Assistance Corporation, on demand, an amount equal 
to the outstanding principal of the obligation. Each 
bank shall pay a proportion of the principal equal 
to— 
**(I) the average accruing loan volume of the 
bank for the preceding 15 years; divided by 
"(II) the average accruing loan volume of all 
banks of the System for the same period. 
"(ii) BANKS LEAVING SYSTEM.—Any bank leaving 
the Farm Credit System pursuant to section 7.10 shaU 
be required, under regulations of the Farm Credit 
Administration, to pay to the Financial Assistance Cor-
poration the estimated present value of the payment 
required under this subparagraph had the bank 
remained in the System. 
"(iii) 
BANKS 
UNDERGOING 
UQUIDATION.—With 
respect to any bank undergoing liquidation under this 
Act, a liability to the Financial Assistance Corporation 
in the amount of the payment required under this 
subparagraph (calculated as if the bank had left the 
System on the date it was placed in liquidation) shall 
be recognized as a claim in favor of the Financial 
Assistance Corporation against the estete of the bank. 
"(iv) OBUGATIONS OF OTHER BANKS.—The obliga-
tions of other banks shall not be reduced in anticipation 
of any recoveries under this subparagraph from banks 
leaving the System or in liquidation, but the Financial 
Assistance Corporation shall apply the recoveries, 
when received, and all earnings on the recoveries, to 
reduce the other banks' payment obligations, or, to 
the extent the recoveries are received aft^er the other 
banks have met their entire pa3m(ient obligation, shaU 
refund the recoveries, when received, to the other 
banks in proportion to the other banks' payments."; 
(2) by redesignating subparagraph (D) as subparagraph 
(E); 
(3) by inserting after subparagraph (C) the following new 
subparagraph: 
^(D) ANNUAL PAYMENTS.— 
Contracts. 
«(i) IN GENERAL.—In order to provide for the 
orderly funding and discharge over time of the obliga-
tion of each System bank to the Financial Assistance 
Corporation under subparagraph (C), each System 
bank shall enter into or continue in effect an agreement 
with tiie Financial Assistance Corporation under which 
the bank will make annual annmty-type pa3rments to 
the Financial Assistance Con>oration, beginning no 
later than December 31, 1992 (except for any bank 
that did not meet its interim capital reauirement on 
December 31,1990, in which case the bank shall begin 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4109 
making the payments no later than December 31,1993) 
in amounts designed to accumulate, in total, including 
earnings on the amoimts, to 90 percent of the bank's 
ultimate obligation. The Financial Assistance Corpora-
tion shall partially discharge the bank from its obliga-
tion under subparagraph (C) to the extent of each 
such pajrment and the earnings on the pajrment as 
earned. 
"(ii) CAPITAL REQUIREMENTS.—The agreement shall 
not require payments to be made to the extent that 
making a particular payment or part of a payment 
would cause the bank to fail to satisfy applicable 
regulatory permanent capital requirements, but shall 
provide for recalculation of subsequent payments 
accordingly. 
"(iii) 
INVESTMENT; 
AVAILABILITY.-The 
funds 
received by the Financial Assistance Corporation 
piirsuant to the agreements shall be invested in eligible 
investments as defined in section 6.25(aXl). The funds 
and the earnings on the funds shall be available only 
for the payment of the principal of the bonds issued 
by the Financial Assistance Corporation under this 
subsection."; and 
(4) in subparagraph (E) (as redesignated by paragraph 
(2)), by inserting before the period at the end the following: 
", nor shall the obligation to make future annuity payments 
to the Finsuicial Assistance Corporation under subparagraph 
(D) be considered a liability of any System bank". 
SEC. 302. PREFERRED STOCK. 
Subparagraph (B) of section 6.26(dXl) (12 U.S.C. 2278b-
6(d)(lXB)) is amended to read as follows: 
"(B) PAYMENTS B
Y INSTITUTIONS.— 
"(i) IN GENERAL.—^Except as provided in subpara-
graph (C), in order to enable the Financial Assistance 
Corporation to repay the obligation referred to in 
subparagraph 
(A), 
each 
institution 
that 
issued 
preferred stock under section 6.27(a) with respect to 
the obligation (or the successor to the institution) shall 
pay to the Financial Assistance Corporation, before 
the maturity date of the obligation, an amoimt 
equal to the par value of the stock outstanding for 
the institution. 
"(ii) ANNUAL APPROPRIATION.—Except as provided 
in clause (iii), each year beginning in 1992, as soon 
as practicable following the end of the prior year, each 
such institution (except institutions in receivership and 
institutions that have previously redeemed their pre-
ferred stock) shall appropriate from its earnings in 
the prior year to an appropriated unallocated surplus 
account with respect to preferred stock, the sum of— 
"(I) the greater of— 
"(aa) such amoiint as the institution may 
^ 
be required to appropriate imder any assist-
ance agreement the institution has with the 
Farm Credit System Assistance Board or the 
106 STAT. 4110 
PUBLIC LAW 102-552—OCT. 28, 1992 
Farm Credit System Insurance Corporation; 
or 
"(bb) the amount that, if appropriated to 
the accoimt in equal amounts m each year 
thereafter until the maturity of the obligation 
referred to in subparagraph (A), would cause 
the amount in the account to equal the par 
value of the preferred stock issued by the 
institution with respect to the obligation; plus 
"(11) any amount that had been appropriated 
to the account in a previous year but had there-
after been offset by losses. 
"(iii) LIMITATION.—An annual appropriation shall 
not be made to the extent that the appropriation would 
exceed the institution's net income (as determined 
pursuant to generally accepted accounting principles) 
m that year or to the extent that the appropriation 
would cause the institution's preferred stock to be 
impaired. 
"(iv) USE.—^The amoimt in the appropriated 
unallocated surplus account shall be unavailable to 
pay dividends or other allocations or distributions to 
shareholders or holders of participation certificates. 
The account shall be senior to all other unallocated 
surplus accounts but junior to all preferred and com-
mon stock for purposes of the application of operating 
losses. 
"(v) PREFERRED STOCK.—^The appropriations of sur-
plus by an institution shall not anect the treatment 
of its preferred stock (and of the appropriated 
unallocated surplus) as equity for purposes of regu-
latory permanent capital requirements.". 
SEC. 303. SYSTEMWIDE REPAYMENT OBLIGATION. 
Subparagraph (C) of section 6.26(dXl) (12 U.S.C. 2278b-
6(dX 
IXC;)) is amended to read as follows: 
"(C) SYSTEMWIDE REPAYMENT.— 
"(i) IN GENERAL.—^In order to enable the Financial 
Assistance Corporation to repay the obligations issued 
to provide assistance under subsections (c) and (e) of 
section 410 of the Agricultural Credit Act of 1987 (12 
U.S.C. 2011 note) and section 4.9A(c) of this Act, or 
issued to provide funds to cover the expenses of the 
Assistance Board or the Financial Assistance Corpora-
tion under sections 6.7(a) and 6.24, respectively, of 
this Act, each System bank shall pay to the Financial 
Assistance Corporation a proportion, as calculated by 
the Financial Assistance Cforporation, of the obligation 
equal to— 
"(I) the average accruing retail loan volume 
of the bank and its affiliated associations for the 
preceding 15 years; divided by 
"(ID the average accruing retail loan volume 
of all such banks and their affiliated associations 
for the same period. 
"(ii) EXPENSE ITEM.—^The annual increase in the 
present value of the estimated obUgation of each bank 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4111 
to the Financial Assistance Corporation under this 
subparagraph shall be recorded each year as an 
expense item, in accordance with generally accepted 
accoimting principles, on the books of the bank. 
"(iii) PASS THROUGH.—A bank may (and, to the 
extent necessary to satisfy its obligations, shall) pass 
on (either directly, or indirectly through lo£ui pricing 
or otherwise) all or part of the amount necessaiy to 
satisfy the payment requirement to its afiEiliated direct 
lender associations based on proportionate average 
accruing retail loan volimies for the preceding 15 years, 
except that the bank shall remain primarily Uable 
for the amoimt. 
"(iv) BANKS LEAVING SYSTEM.—^Any bank leaving 
the Farm Credit System pursuant to section 7.10 shall 
be required, under regulations of the Farm Credit 
Administration, to pay to the Financial Assistance Cor-
poration the estimated present value of the payment 
required under this subparagraph had the bank 
remained in the System. A liability to the Financial 
Assistance Corporation in this amoimt (calculated as 
if the bank had left the System on the date it was 
placed in Uquidation) shall be recognized as a claim 
in favor of the Financial Assistance Corporation 
against the estate of any bank imdergoing liquidation. 
Tne obligations of other banks shall not be reduced 
in anticipation of an^ such recoveries from banks leav-
ing the System or in liquidation, but the Financial 
Assistance Corporation shall apply the recoveries, 
when received, and all earnings on the recoveries, to 
reduce the other banks' pajmoient obligations, or, to 
the extent the recoveries are received after the other 
banks have met their entire payment obligation, shall 
refund the recoveries, when received, to the other 
banks in proportion to the other banks' payments. 
"(v) ASSOCIATIONS TERMINATING SYSTEM STATUS OR 
IN LIQUIDATION.—^Any association leaving the Farm 
Credit System pursuant to section 7.10 shall be 
required, under regulations of the Farm Credit 
Administration, to pay to its supervising bank a share, 
based on the association's retail loan volume relative 
to the retail loan volume of the bank and its affiliated 
associations had the association remained in the Sys-
tem, of the present value of the future payment obliga-
tion of its supervising bank. A liability to the bank 
in this amount (calculated as if the association had 
left the System on the date it was placed in 
liquidation) shall be recognized as a claim in favor 
of the bank against the estate of any association under-
going liquidation.". 
SEC. 304. REPAYMENT OF TREASURY-PAID INTEREST. 
(a) IN GENERAL.—Paragraph (5) of section 6.26(c) (12 U.S.C. 
2278b-6(cX5)) is amended to read as follows: 
"(5) REPAYMENT OF TREASURY-PAID INTEREST.— 
"(A) IN GENERAL.—On the maturity date of the last-
maturing debt obligation issued under subsection (a), the 
106 STAT. 4112 
PUBLIC LAW 102-552—OCT. 28, 1992 
Financial Assistance Corporation shall repay to the Sec-
retary of the Treasury the total amount of any annual 
interest charges on the debt obligations that Farm Credit 
System institutions (other than the Financial Assistance 
' Corporation) have not previously paid, and the Financial 
Assistance Corporation shall not oe required to pay any 
additional interest charges on the payments. 
"(B) ASSESSMENT.—^In order to provide for the orderly 
funding by the banks of the System of the repayment 
by the Financial Assistance Corporation to the Secretaiy 
of the Treasunr, the Financial Assistance Corporation shall 
assess each System bank, on or about December 31 of 
each year beginning in 1992, and each System bank shall 
promptly pay to the Financial Assistance Corporation, an 
annual annuity type pa3anent in an amount designed to 
accumulate, in total, including earnings thereon, the 
amount of the bank's ultimate obligation (as determined 
by the Corporation on a fair and equitable basis), and 
no greater than .0006 nor less than .0004 times the bank's 
and its affiliated associations' average accruing retail loan 
volume for the preceding year, subject to— 
"(i) upward or downward ac^justment, as appro-
priate, by the Financial Assistence Corporation during 
each of the last 5 years prior to the date the Financial 
Assistance Corporation is obligated to make the repay-
ment, in order to ensure that the Financial Assistance 
Corporation vdll have the amount of funds needed 
to make the repajnnent on the due date; and 
"(ii) reduction or termination in any year when 
the fUnds paid to the Financial Assistance Corporation, 
including any anticipated future earnings on the funds, 
are sufficient to make the repa3naient on the due date. 
*(C) INVESTMENT OF FUNDS.—The Financial Assistance 
Corporation shall invest funds derived from the investment 
in eligible investments as defined in section 6.25(aXl). 
The funds and the earnings on the funds shall be available 
only for the repayment to the Secretory of the Treasury 
provided for in subparagraph (A). 
"(D) PASS THROUGH.—A bank may (and, to the extent 
necessary to satisfy its obligations, snail) pass on (either 
directly, or indirectly through loan pricing or otherwise) 
all or part of the assessments to ite affiliated direct lender 
associations based on proportionate average accruing retail 
loan volumes for the preceding year, but the bank shall 
remain primarily Uable for the amounts. 
"(E) LIABILITY.— 
"(i) BANKS TERMINATING SYSTEM STATUS OR IN UQ-
U
I
D
A
T
I
O
N
.
—
^
A
n
y bank terminating System stotus 
{>ursuant to section 7.10 shall be required, under regu-
ations of the Farm Credit Administration, to pay to 
the Financial Assistance Corporation the estimated 
: I , 
present value of all future such assessmente against 
the bank had the bank remained in the System. A 
liability to the Financial Assistance Corporation in this 
amount (calculated as if the bank had left the System 
on the date the bank was placed in liquidation) shall 
be recognized as a claim in favor o
f
^ the Financial 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4113 
Assistance Corporation against the estate of any bank 
undergoing liquidation. 
**(ii) No A
N
T
I
C
I
P
A
T
O
R
Y R
E
D
U
C
T
I
O
N
S IN O
T
H
E
R 
O
B
L
I
G
A
T
I
O
N
S
.
—
^
T
h
e obligations of other banks shall not 
be reduced in anticipation of any recoveries under this 
subparajgraph from banks leaving the System or in 
liquidation. 
"(iii) REFUND OF RECOVERIES.—The Financial 
Assistance Corporation shall apply the recoveries, 
when received, and all earnings on the recoveries, to 
reduce the other banks' payment obligations, or, to 
the extent the recoveries are received after the other 
banks have met their entire payment obligation, shall 
refund the recoveries, when received, to the other 
banks in proportion to the other banks' payments. 
"(F) ASSOCIATIONS TERMINATING SYSTEM STATUS OR IN 
LiQinDATlON.—Any association terminating System status 
pursuant to section 7.10 shall be required, under regula-
tions of the Farm Credit Administration, to pay to its 
supervising bank a share, based on the association's retail 
loan volume relative to the retail loan volume of the bank 
and its afiiliated associations had the association remained 
in the System, of the estimated present value of all future 
such assessments against the bank. A liability to the bank 
in this amount (caicidated as if the association had left 
the System on the date it was placed in Uquidation) shall 
be recognized as a claim in favor of the bank against 
the estate of any association undergoing liquidation. 
"(G) CAPITAL R
E
Q
U
I
R
E
M
E
N
T
S
.
— 
"(i) IN GENERAL.—Until the date that is 5 years 
prior to the date on which the Financial Assistance 
Corporation is required to repay the Secretary of the 
Treasury pursuant to subparagraph (A), all assess-
ments paid by banks to the Financial Assistance Cor-
poration pursuant to subparagraph (B), and any part 
of the obligation to pay future assessments to the 
Financial Assistance Corporation under subparagraph 
(B) that is recognized as an expense on the books 
of any Svstem bank or association, shall nonetheless 
be included in the capital of the bank or association 
for purposes of determining its compliance with regu-
latory capital requirements. 
**(ii) DURING THE FINAL 5 YEARS PRIOR TO REPAY-
MENT.—^During the— 
"(I) period beginning 5 years, and ending 4 
years, prior to the date on which the Financial 
Assistance Corporation is required to repay the 
Secretary of the Treasury piirsuant to subpara-
graph (A), 60 percent; 
"(11) period beginning 4 years, and ending 3 
years, prior to the date on which the Financial 
Assistance Corporation is required to repay the 
Secretary of the Treasury pursuant to subpara-
graph (A), 30 percent; and 
"(III) period beginning 3 years prior to the 
date on which the Financial Assistance Corpora-
106 STAT. 4114 
PUBLIC LAW 102-552—OCT. 28, 1992 
tion is required to repay the Secretary of the Treas-
ury piirsuant to subparagraph (A), 0 percent, 
of all assessments paid by banks to the Financial 
Assistance Corporation pursuant to subparagraph (B), 
and of any part of the obligation to pay future assess-
ments to the Financial Assistance Corporation under 
subparagraph (B) that is recognized as an expense 
on the IK>OKS of any System bank or association, shsdl 
nonetheless be included in the capital of the bank 
or association for purposes of determining its compli-
ance with regulatory capital requirements. . 
(b) CONFORMING AMENDMENT.—Section 6.28 (12 U.S.C. 2278b-
8) is amended by striking subsection (b) and redesignating sub-
section (c) as subsection (b). 
SEC. 306. TRANSFER OF OBUGATIONS FROM ASSOCIATIONS TO 
BANKS; OTHER MATTERS. 
Section 6.26 (12 U.S.C. 2278b-6) is amended— 
(1) in subsection (c)— 
(A) in the subparagraph heading of paragraph (2XB), 
/- 
by striking "INSTITUTIONS** and insertmg "BANKS"; 
(B) by striking "institutions'* each place it appears 
in paragraphs (2XB), (3), and (4) and inserting "banks'*; 
and 
(C) in paragraph (2), by striking subparagraphs (C) 
and (D) and inserting the following new subparagraph: 
"(C) ALLOCATION.—^During each year of me second 
5-year period, each System bank shall pay to the Financial 
Assistance Corporation a proportion, as calculated by the 
Financial Assistance Corporation, of the interest due from 
System banks under this paragraph equal to— 
"(i) the amount of the average accruing retail loan 
volume of the bank and its affiliated associations for 
the preceding year; divided by 
"(ii) the total average accruing retail loan volume 
of all such banks and their affiliated associations for 
the preceding vear.**; 
(2)insuDsection(d)(l)— 
(A) by striking subparagraph (D); and 
(B) by redesignating subparagraph (E) as subpara-
graph (D); and 
(3) by adding at the end the following new subsection: 
"(e) ADMINISTRATION.— 
"(1) DEFINITION OF RETAIL LOAN VOLUME.—As used in this 
section, the term 'retail loan volume' means all loans (as defined 
in accordance with generally accepted accounting principles) 
by a System bank or association, excluding loans by such a 
bank or association to another System institution. 
"(2) CALCULATION OF AVERAGE ANNUAL LOAN VOLUMES.— 
For purposes of this section and section 6.9, average annual 
loan volumes shall be calculated using month-end balances. 
"(3) EXCLUSION OF BANKS UNDERGOING UQUIDATION.—^For 
purposes of this section and section 6.9, the term 'beuik* shall 
not include a bank that had entered liquidation prior to the 
date of enactment of this subsection.**. 
SEC. 306. DEFAULTS. 
Section 6.26(d) (12 U.S.C. 2278b-6(d)) is amended— 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4115 
(1) in paragraph (3)— 
(A) in subparagraph (A)— 
(i) by striking the heading and inserting the fol-
lowing: "CERTAIN PRINCIPAL AND INTEREST OBUGA-
TIONS.—"; 
(ii) in clause (i)— 
(I) l^ inserting after "subsection (a)," the fol-
lowing: on the payment of principal or interest 
due under subparagraphs (B) and (C) of section 
6.9(eX3), on the payment of principal due under 
paragraph (IXC), or on the pajrment of an assess-
ment due imder subsection (cXSXB),"; 
(II) by striking "of the interest" both places 
it appears; and 
(III) by striking "institution" each place it 
appears and inserting "bank"; 
(iii) in clause (ii)— 
' 
(I) by striking "of interest"; 
(II) by striking "institution" and inserting 
"bank"; and 
(III) by striking "such uncollected interest" and 
inserting "any uncollected amount"; and 
(iv) in clause (iii), by striking "added" and all that 
follows through the period at the end and inserting 
"allocated to other System banks in accordance with 
the allocation mechanism applicable under this Act 
to the particular defaulted obligation."; 
(B) in subparagraph (B), by striking the subparagraph 
hea^ng and inserting the following new heading: "PRIN-
CIPAL OF B
O
N
D
S ISSUED TO FUND PURCHASE OF PREFERRED 
STOCK.—"; and 
(C) in subparagraph (C)— 
(i) in the heading, by striking "INSTITUTIONS" and 
inserting "BANKS"; 
(ii) by striking "institution" and inserting "bank"; 
(iii) by striking "institutions" both places it appears 
and inserting "banks"; and 
(iv) by striking "the amount of any interest" and 
inserting any amoimts"; and 
(2) in paragraph (4)— 
(A) in subparagraph (A), by inserting "or section 
6.9(eX3XA)" after "subsection (a)"; 
(B) in subparagraph (B)— 
(i) in clause (i)— 
(I) by striking the clause heading and inserting 
the following new heading: "CERTAIN PRINCIPAL 
AND INTEREST OBUGATIONS.—"; 
(II) by inserting after "subsection (c)," the fol-
lowing: "on the payment of principal or interest 
due under subparagraphs (B) and (C) of section 
6.9(eX3), on the payment of principal due under 
paragraph (IXC), or on the payment of an assess-
ment due under subsection (cX5XB),"; and 
(III) by striking "institution" each place it 
appears and inserting "bank"; and 
(ii) in clause (ii), by striking the clause heading 
and inserting the following new heading: "PRINCIPAL 
106 STAT. 4116 
PUBLIC LAW 102-552—CK!T. 28, 1992 
OF BONDS ISSUED TO FUND PURCHASE OF PREFERRED 
STOCK.—". 
SEC. 307. AUTHORmr OF FINANCIAL ASSISTANCE CORPORATION. 
(a) PURPOSE.—Section 6.21 (12 U.S.C. 2278b-l) is amended 
by inserting before the period at the end tiie following: "and to 
assist, pursuant to section 6.9(e) and subsections (c) through (g) 
of section 6.26, in the repa^ent by System institutions to those 
persons who provided funds m connection with the program". 
(b) TERMINATION.—Section 6.31(a) (12 U.S.C. 2278b-ll(a)) is 
amended by striking *i;erminate on" and inserting the following: 
'^rminate on the complete discharge by the Financial Assistance 
Corporation of its responsibilities under section 6.9(e) and sub-
sections (c) through (g) of section 6.26 with regard to repa3rments 
by System institutions, but in no event later than 2 years following". 
SEC. 308. TECHNICAL AMENDMENTS. 
(a) TECHNICAL AMENDMENT TO THE FOOD, AGRICULTURE, CON-
SERVATION, A
N
D TRADE ACT AMENDMENTS OF 1991.—Section 204(3) 
of the Food, Agriculture, Conservation, and Trade Act Amendments 
of 1991 (Public Law 102-237; 105 Stat. 1855) is amended by striking 
"in section 1221(1XD) (16 U.S.C. 3821(1XD))" and insertmg "in 
section 1221(aXlXD) (16 U.S.C. 3821(aXlXD))". 
(b) TECHNICAL AMENDMENTS TO THE FARM CREDIT ACT OF 
1971.— 
(1) Section 8.3(cX13) of the Farm Credit Act of 1971 (12 
U.S.C. 2279aa-3(cX13)) is amended by striking "8.11(g)" and 
inserting "8.11(e)". 
(2) Section 8.11(aXlXBXii) of such Act (12 U.S.C. 2279aa-
ll(aXlXBXii)) is amended by striking "the date of enactment 
of this section" and inserting "December 13,1991". 
(3) Section 8.32 of such Act (12 U.S.C. 2279bb-l) is 
amended— 
(A) in each of subsections (a), (bXlXD), and (bX2), 
by striking "the date of the enactment of this section" 
each place the term appears and inserting "December 13, 
1991**; and 
(B) in subsection (bXlXE), by striking "the date of 
the enactment of such Act" and inserting "December 13, 
1991". 
TITLE IV—CLARIFICATION OF CERTAIN 
AUTHORITIES 
SEC. 401. CLARIFICATION OF THE STATUS AND POWERS OF CERTAIN 
INSTITUTIONS OF THE FARM CREDIT SYSTEM. 
(a) CLARIFICATION OF AUTHORITY REGARDING REMAINING FED-
ERAL INTERMEDIATE CREDIT BANK.—Section 410 of the Agricultural 
Credit Act of 1987 (12 U.S.C. 2011 note) is amended by adding 
at the end the following new subsection: 
"(e) CLARIFICATION OF AUTHORITY REGARDING REMAINING FED-
ERAL INTERMEDIATE CREDIT BANK— 
"(1) NEGOTIATED MERGER.— 
"(A) REQUIREMENT.— 
"(i) IN GENERAL.—Not later than June 30, 1993, 
except as provided in subparagraph (C), the Federal 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4117 
Intermediate Credit Bank of Jackson (as chartered 
on the date of enactment of this subsection) shall merge 
with a Farm Credit Bank pursuant to the procedures 
prescribed by section 7.12 of the Farm Credit Act of 
1971 (12 U.S.C. 2279f). 
"(ii) MERGER OF ENTIRE BANK.—Notwithstanding 
subparagraph (B), or any other provision of law, the 
Farm Credit Administration shall approve a merger 
of the Federal Intermediate Credit Bank of Jackson 
only if the Bank (as chartered on the date of enactment 
of this subsection, except as provided in subparagraph 
(BXiiXIIXbb)) merges in its entirety with a Farm Credit 
Bank. 
"(iii) LIMITED LENDING AUTHORITY.—Notwithstand-
ing any provision of the Farm Credit Act of 1971 
(12 U.S.C. 2001 et seq.), the Farm Credit Bank result-
ing from a merger under this subsection shall have 
only the lending authorities in the States of Alabama, 
Louisiana, and Mississippi that the constituent banks 
exercised in such States immediately prior to the 
merger, except as may be provided in section 5.17(aX2) 
of such Act (12 U.S.C. 2252(aX2)). 
"(B) OPERATING AND MERGER AUTHORITY.— 
"(i) IN GENERAL.—Except as provided in clause 
(ii), the Federal Intermediate Credit Bank of Jackson 
may operate subject to such provisions of part A of 
title II of the Farm Credit Act of 1971 (as in effect 
immediately before the amendment made by section 
401 took effect) and such provisions of the Farm Credit 
Act of 1971 (12 U.S.C. 2001 et seq.) (as in effect after 
the amendment), as the Farm Credit Administration 
deems appropriate to carry out the purposes of this 
subsection and such Act. This subparagraph shall take Effective date, 
effect as if it had become law at the same time as 
the amendment made by section 401 and shall remain 
in effect until the Bank's merger with a Farm Credit 
Bank imder this subsection, or July 1, 1994, whichever 
is sooner. 
"(ii) LIMITATION ON OPERATING AUTHORITY.— 
"(I) IN GENERAL.—^Notwithstanding clause (i) 
and subparagraph (AXii), the authority of the Fed-
eral Intermediate Credit Bank of Jackson to oper-
ate as provided under clause (i) shall expire, and 
the Farm Credit Administration shall revoke the 
Bank's charter, immediately on the Bank's merger 
with a Farm Credit Bank under this subsection, 
or July 1,1994, whichever is sooner. 
"(II) DISTRICT B
O
U
N
D
A
R
Y MODIFICATION.—Not-
withstanding clause (i), the authority of the Fed-
eral Intermediate Credit Bank of Jackson shall 
not include the authority for the Bank to modify, 
nor shall the Farm Cre(ht Administration approve 
such a modification to, the boundaries of the Fifth 
Farm Credit District to reafliliate any portion of 
the District with another Farm Credit Bank, 
except— 
106 STAT. 4118 
PUBLIC LAW 102-552—OCT. 28, 1992 
"(aa) in the case of the merger of the 
entire Bank as an entity with a Farm Credit 
Bank such that the entire chartered territory 
of the Federal Intermediate Credit Bank of 
Jackson (except as provided in item (bb)) is 
merged with the Farm Credit Bank; and 
"(bb) in the case of the reaffiliation of 
the Northwest Louisiana Production Credit 
Association with another farm credit district 
pursuant to the Farm Credit Act of 1971 (12 
U.S.C. 2001 et seq.) and any applicable regula-
tions under such Act. 
"(iii) LIMITATION ON AUTHORrry TO MERGE.— 
"(I) IN GENERAL.—Notwithstanding clause (i), 
the authority of the Federal Intermediate Credit 
Bank of Jackson to merge with a Farm Credit 
Bank as provided under clause (i) shall expire, 
and the Farm Credit Administration shall revoke 
the Bank's charter, immediately on the Bank's 
merger with a Farm Credit Bank under this sub-
section, or July 1,1994, whichever is sooner. 
"(ID 
BANK 
INTEGMTY.—Notwithstanding 
clause (i), the authority of the Federal Intermedi-
,,; , > 
ate Credit Bank of Jackson to merge with a Farm 
Credit Bank shall be limited to a merger of the 
Federal Intermediate Credit Bank of Jackson (as 
chartered on the date of enactment of this sub-
section to include the territory in the States of 
Alabama, Louisiana, and Mississippi, except as 
provided in clause (iiXIIXbb)) as a whole entity 
such that the entire chartered territory of the Fed-
eral Intermediate Credit Bank of Jackson is 
merged with the Farm Credit Bank. 
"(Ill) LIMITATION.—Beginning on the date of 
an order issued by the Farm Credit Administration 
under subparagraph (D), the authority of the Fed-
eral Intermediate Credit Bank of Jackson to merge 
with a Farm Credit Bank shall be limited to the 
arbitrated merger provided for in paragraph (2). 
"(C) EXTENSION.— 
"(i) LETTER OF INTENT.—^If no later than June 30, 
1993, Uie Federal Intermediate Credit Bank of Jackson 
delivers to the Farm Credit Administration a letter 
of intent to merge with a Farm Credit Bank, summariz-
ing the terms and conditions of the merger (including, 
but not limited to, board composition, capital structure, 
exchange, or transfer of equities, and termination) 
smned D
y the chief executive officer and the members 
of the boards of directors of the Federal Intermediate 
Credit Bank of Jackson and the Farm Credit Bank, 
tiie Farm Credit Administration shall, on its deter-
mination that the letter of intent represents a bona 
fidci good faith agreement in principle between the 
two banks to merge, and that there is at least a reason-
able prospect that the merger will be completed in 
an expeditious manner, grant a one-time extension, 
until a date certain not later than October 31, 1993, 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4119 
of the requirement under subparagraph (A). Any exten-
sion provided under this subparagraph may be condi-
tioned on such terms and conoitions as the Farm Credit 
Administration determines necessary to ensure that 
the merger described in the letter of intent is completed 
by the closing date of the extension. 
"(ii) COMPLIANCE.—If the Farm Credit Administra-
tion grants an extension under clause (i), it shall issue 
an order under subparagraph (D) immecUatel^ if— 
"(1) the Federal Intermediate Credit Bank of 
Jackson, or the Farm Credit Bank that is a si^na-
tor^ to the letter of intent under clause (i), provides 
written notification to the Farm Credit Adminis-
tration that the bank does not intend to complete 
the merger described in the letter of intent; 
"(11) the Farm Credit Administration deter-
mines that the Federal Intermediate Credit Bank 
of Jackson is not compljring with any term or condi-
tion on which an extension under clause (i) was 
conditioned: or 
"(III) the Farm Credit Administration deter-
mines that the Federal Intermediate Credit Bank 
of Jackson is not pursuing in good faith the merger 
provided for in the letter of intent. 
If the Farm Credit Administration issues an order 
under subparagraph (D) pursuant to this clause, the 
Federal Intermediate Credit Bank of Jackson shall 
be deemed to have failed to comply with the require-
ments of subparagraph (A). 
"(D) FAILURE TO MERGE; ISSUANCE OF ORDER.—If the 
Federal Intermediate Credit Bank of Jackson fails to com-
ply, or notifies ithe Farm Credit Administration in writing 
that it does not intend to comply, with the requirements 
of subparagraph (A), the Farm Credit Administration shall, 
within 5 days ajfter the date specified in subparagraph 
(A), or such other date specified by the Farm Credit 
Administration under subparagraph (C), issue, notwith-
standing any other provision of law, an order requiring 
the Federal Intermediate Credit Bank of Jackson to merge 
with the Farm Credit Bank of Texas in accordance with 
paragraph (2). 
'(2) ARBITRATED MERGER.— 
"(A) IN GENERAL.—Not later than 30 days afl^r the 
issuance of an order by the Farm Credit Administration 
under paragraph (IXD), an arbitrator (or panel of arbitra-
tors) shall be named by the American Arbitration Associa-
tion in accordance with the Commercial Arbitration Rules 
of the American Arbitration Association to serve as the 
arbitrator refen'ed to in Uiis paragraph. 
"(B) DUTIES.—^The arbitrator shall determine the terms 
and conditions of the merger required under an order 
issued under paragraph (IXD), such that the terms and 
conditions are fair and equitable to the two banks, their 
affiliated associations, the stockholders and borrowers of 
the associations, and the other institutions of the Farm 
Credit System, and are designed to protect or enhance 
the safety and soundness of the Farm Credit System. The 
59-194 O—93 
16:QL3(Pt. 5) 
106 STAT. 4120 
PUBLIC LAW 102-552—OCT. 28, 1992 
arbitrator shall have the authority to hire staff and secure 
the services of consultants as necessary to discharge the 
duties of the arbitrator under this paragraph. 
"(C) EXPENSES.—Notwithstanding any other provision 
of law, the compensation and expenses of the arbitrator, 
the fees and expenses of the American 
Arbitration 
Association, 
and 
any 
expenses 
associated 
with 
the 
referendum required under subparagraph (F) shall be paid 
from the Farm Credit Assistance Fund established under 
section 6.25 of the Farm Credit Act of 1971 (12 U.S.C. 
2278h-5). 
"(D) DEVELOPMENT OF MERGER PLANS.— 
"(i) IN GENERAL.—Not later than 100 days after 
the issuance of an order by the Farm Credit Adminis-
tration under paragraph (1)(D), the arbitrator shall 
develop and submit for certification to the Farm Credit 
Administration a plan specifying the terms and condi-
tions of the merger of the two banks required under 
this paragraph, such that the terms and conditions 
are fair and equitable to the two banks, their affiliated 
associations, the stockholders or farmer-borrowers of 
the associations, and the other institutions of the Farm 
Credit System, and are designed to protect or enhance 
the safety and soundness of the Farm Credit System. 
In devising the plan, the arbitrator shall, to the extent 
practicable, achieve the following objectives: 
"(I) 
Implementation 
of 
the 
preferences 
expressed by the eiffected and interested parties 
in submissions under clause (ii). 
"(II) Valuation of assets fairly, equitably, and 
/ 
consistently for all parties involved. 
"(Ill) Establishment of capitalization and fund-
ing terms in a manner that treats farmer-borrow-
ers and stockholders in the two involved farm 
credit districts equitably and takes accoiint of risk. 
"(IV) Ensure the viability of the resulting 
Farm Credit Bank and associations of the bank 
and the abilitv of the resulting bank and associa-
tions of the bank to lend to eligible borrowers 
at reasonable and competitive rates of interest. 
'" 
"(ii) SUBMISSION OF VIEWS AND INFORMATION.—The 
^ 
arbitrator shall receive from affected and interested 
parties written submissions, in accordance with fair 
and reasonable procedures established by the arbitra-
tor, regarding the terms and conditions of an appro-
priate plan for the merger of the two banks required 
under this paragraph. The Federal Intermediate Credit 
Bank of Jackson, the Farm Credit Bank of Texas, 
and their affiliated associations shall make available 
all books, records, financial information, and other 
material that the arbitrator determines is necessary 
to the development of the plan or the fulfillment of 
any other requirement under this paragraph. A copy 
of any submission or information provided to tne 
arbitrator by any party under this paragraph shall 
be furnished to the Federal Intermediate Credit Bank 
of Jackson or the Farm Credit Bank of Texas on the 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4121 
written request of the bank and at the bank's expense. 
The arbitrator shall provide both banks with a reason-
able opportunity to review and respond to any submis-
sion or information provided by any party. 
"(iii) CONTENT OF PLAN; FARM CREDIT BANK.—The 
plan developed and submitted under clause (i) shall 
include provisions regarding the following matters: 
"(I) The initial composition, following the 
merger, of the board of directors of the resulting 
Farm Credit Bank (which shall be subject to 
change thereafter in accordance with the Farm 
Credit Act of 1971 (12 U.S.C. 2001 et seq.) and 
any applicable regulations). 
"(II) The valuation, for purposes of the merger, 
of the assets and liabilities of the merging banks. 
"(Ill) The terms and conditions on which the 
shares of capital stock of the Federal Intermediate 
Credit Bank of Jackson and, if necessary, the Farm 
Credit Bank of Texas, will be converted into shares 
of the resulting Farm Credit Bank. 
"(IV) The capital structure and capitalization 
levels of the resulting Farm Credit Bank and the 
affiliated associations of the Farm Credit Bank 
in the States of Alabama, Louisiana, and Mis-
sissippi as the arbitrator determines necessaiy to 
carry out the purposes of this paragraph (which 
shall be subject to change thereafter in accordance 
with the Farm Credit Act of 1971 (12 U.S.C. 2001 
et seq.) and any applicable regulations). 
"(V) The terms of financing 
agreements 
between any production credit associations or agri-
cultural credit associations described in clause (iv), 
and the resulting Farm Credit Bank (which shall 
be subject to change thereafter in accordance with 
the Farm Credit Act of 1971 (12 U.S.C. 2001 et 
seq.) and any applicable regulations). 
"(VI) Any ouier terms and conditions or other 
matters that the arbitrator considers necessary, 
"(iv) 
CONTENT OF PLAN; AGRICULTURAL CREDIT 
ASSOCIATIONS.—If the arbitrator determines that the 
chartering of agricultural credit associations in the 
States of Alabama, Louisiana, and Mississippi will be 
in the best interests of the farmers, ranchers, and 
aquatic producers eligible to borrow from Farm Clredit 
System associations, the plan required under this 
subparagraph shall also include, based on submissions 
from the Federal Intermediate Credit Bank of Jackson 
and the Farm Credit Bank of Texas, provisions for 
the establishment of agricultural credit associations 
to operate in the States, subject to approval in the 
referendum under subparagraph (F). Such provisions 
shall include provisions regarding the following mat-
ters: 
"(I) A proposal for the establishment of an 
agricultural credit association in each of the 
geographic areas specified in subparagraph (FXiii) 
(the charters of which, if validly issued under 
106 STAT. 4122 
PUBLIC LAW 102-552—OCT. 28, 1992 
subparagraph (GXi) pursiiant to approval in the 
referendum under subparagraph (F), shall be sub-
ject to change thereaiter m accordance with the 
Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.) 
and any applicable regulations). 
''(II) Tne initial composition, if the proposal 
for the establishment of agricultural credit associa-
tions is approved, of the board of directors of each 
such agricultural credit association (which shall 
be subject to change thereafter in accordance with 
the Farm Credit Act of 1971 (12 U.S.C. 2001 et 
seq.) and any applicable regulations). 
"(Ill) The valuation, for purposes of the pro-
posed merger of the production credit association 
and the Federal land bank association in each 
of the geo^aphic areas specified in subpara-
graph (FXiii), of the assets and liabilities of the 
associations. 
"(IV) The terms and conditions on which the 
shares of capital stock of any associations that 
may merge imder the plan to form agricultural 
credit associations will be converted into shares 
of the resulting agricultural credit associations. 
"(V) The capital structure and capitalization 
levels of the resulting Farm Credit Bank and such 
affiliated associations of the Farm Credit Bank 
in the States of Alabama, Louisiana, and Mis-
sissippi as the arbitrator determines necessary to 
carry out the purposes of this paragraph (which 
capital structure and capitalization levels shall be 
subject to change thereafter in accordance with 
the Farm Credit Act of 1971 (12 U.S.C. 2001 et 
seq.) and any applicable regulations). 
"(VI) The terms of financing agreements 
between any agricultural credit associations and 
the resulting Farm Credit Bank (which shall be 
subject to change thereafl^er in accordance with 
the Farm Credit Act of 1971 (12 U.S.C. 2001 et 
seq.) and any applicable regulations). 
"(VII) Ally other terms and conditions or other 
matters that the arbitrator considers necessary, 
"(v) 
CONSULTATION WITH INSURANCE CORPORA-
TION.—^The arbitrator shall consult with the Farm 
Credit System Insurance Corporation regarding the 
valuation of the assets and liabilities under the plan 
of merger, the capitalization of the Farm Credit System 
institutions resulting under the plan, and any other 
matters relevant to the assistance to be provided by 
the Insurance Corporation to facilitate the merger 
under subparagraph (H). 
"(E) CERTIFICATION OF PLAN.—Not later than 30 days 
after the receipt of the plan developed by the arbitrator, 
the Farm Credit Administration shall— 
"(i) certify; or 
"(ii) recommend to the arbitrator revisions to the 
plan that, if incorporated into the plan, will allow 
the Farm Credit Administration to certify. 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4123 
that the resulting bank and any resulting associations are 
proposed to be organized in such a fashion that they will, 
on implementation of the plan, operate in compliance with 
applicable laws and regulations. The arbitrator and the 
Farm Credit Administration shall work cooperatively to 
ensure the expeditious issuance of the certification. If the 
Farm Credit Administration recommends to the arbitrator 
revisions to the plan that, if incorporated into the plan, 
will allow the Farm Credit Administration to certify the 
plan, the arbitrator shall, not later than 15 days after 
receipt of the recommended revisions, incorporate the revi-
sions into the plan as the arbitrator deems appropriate 
to secure the certification. 
"(F) REFERENDUM ON ASSOCIATION STRUCTURE.— 
"(i) IN GENERAL.—Not later than 170 days after 
the issuance of an order by the Farm Credit Adminis-
tration under paragraph (IXD), the American Arbitra-
tion Association shall conduct, and compile and forward 
to the Farm Credit Administration the results of, a 
vote of current farmer-borrowers of the production 
credit associations and the Federal land bank associa-
tions in the States of Alabama, Louisiana, and Mis-
sissippi, in accordance with the Election Rules of the 
American 
Arbitration 
Association, 
to 
determine 
whether the farmer-borrowers of each association in 
the geographic aresis described in clause (iii) prefer 
to have credit delivered— 
"(I) in the case of production credit association 
farmer-borrowers, through a production credit 
association or through an agricultiural credit 
association as proposed in the plan; and 
"(II) in the case of Federal land bank associa-
tion farmer-borrowers, through a Federal land 
bank association or through an agricultural credit 
association as proposed in the plan. 
Each farmer-borrower shall be entitled to one vote. 
The arbitrator shall establish record dates and other 
procedures for conducting the referendum. The Federal 
Intermediate Credit Bai^ of Jackson, the Farm Credit 
Bank of Texas, and their affiliated associations shall 
cooperate in the conduct of the referendum, as deter-
mined necessary by the Arbitrator. 
"(ii) DISCLOSURE.—The arbitrator shall send to 
farmer-borrowers eligible to vote under this subpara-
graph, with their ballot, a statement describing the 
potential consequences to the farmer-borrowers, and 
to the associations from which they borrow, of voting 
to charter an agricultural credit association and setting 
forth factors that farmer-borrowers should consider rel-
evant to the choice between credit delivery through 
the ciurent association structure and the chartering 
of an agricultural credit association. The arbitrator 
shall develop the disclosure materials in cooperation 
with the Farm Credit Administration and ensure that 
the materials are not inconsistent with applicable laws 
and regulations. 
106 STAT. 4124 
PUBLIC LAW 102-552—OCT. 28, 1992 
Public 
information. 
"(iii) TABULATION OF RESULTS.—The results of the 
vote under this subparagraph shall be compiled 
separately for production credit association farmer-
borrowers and Federal land bank association farmer-
borrowers in each of the following seven geographic 
areas: 
"(I) The area served by the Federal Land Bank 
Association of South Mississippi. 
''(II) The area served by the Federal Land 
Bank Association of North Mississippi. 
"(Ill) The area served bv the Federal Land 
Bank Association of South Alabama. 
"(IV) The area served by the Federal Land 
Bank Association of North Alabama. 
"(V) The area served by the Federal Land 
Bank Association of South Louisiana. 
"(VI) The area served by both the Federal 
Land Bank Association of North Louisiana and 
the First South Production Credit Association. 
"(VII) The area served by both the Federal 
Land Bank Association of North Louisiana and 
the 
Northwest 
Louisiana 
Production 
Credit 
Association. 
"(iv) PUBLICATION OF RESULTS.—The results of the 
vote under this subparagraph, as tabulated by the 
American Arbitration Association, shall be made 
promptly available to the public in a manner deter-
minea appropriate by the Farm Credit Administration. 
"(G) IMPLEMENTATION.—Not later than 10 days after 
the date of the receipt of the results of the referendum 
conducted under subparagraph (F), the Farm Credit 
Administration shall issue such charters or charter amend-
ments and take such other regulatory actions as may be 
necessary to implement the merger or mergers as provided 
for under the certified plan. In tms regard, the Farm Credit 
Administration shall— 
"(i) issue a charter or charter amendment and 
take any such other regulatory actions as may be nec-
essary to provide for the establishment of an agricul-
tural credit association in each of the geographic areas 
described in subparagraph (FXiii) where a msgority 
of the farmer-borrowers of both the production credit 
association and the Federal land bank association 
voted under subparagraph (FXi) that they preferred 
to have credit delivered through an agricultural credit 
association (which charter shall be subject to change 
thereafter in accordance with the Farm Credit Act 
of 1971 (12 U.S.C. 2001 et seq.) and any applicable 
regulations); and 
"(ii) not issue a charter or charter amendment 
or take any such other regulatory action to provide 
for the establishment of an agricultural credit associa-
tion in any of the geographic areas described in 
subparagraph (FXiii) where less than a majority of 
the farmer-borrowers of the production credit associa-
tion or the Federal land bank association voted in 
the referendum under subparagraph (FXi) that they 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4125 
preferred to have credit delivered through an 
agricultiiral credit association (provided that the char-
ter of any remaining association in such geographic 
area shall be subject to change thereafter in accordance 
with the Farm Credit Act of 1971 (12 U.S.C. 2001 
et seq.) and any applicable regulations). 
"(H) FACILITATION.— 
"(i) IN GENERAL.—^Beginning on the date of the 
issuance of an order by the Farm Credit Administration 
imder paragraph (IXD), the Farm Credit System Insur-
ance Corporation shall expend amounts from the Farm 
Credit Insurance Fiuid to the extent necessary to facili-
tate the merger prescribed in the plan. 
"(ii) MAINTENANCE OP BOOK VALUE.—Assistance 
provided by the Corporation imder this subparagraph 
shall be in amounts not to exceed that required to 
maintain book value per share of stockholders' eauity 
at the same value reflected on the most recent audited 
financial statements of the Federal Intermediate Credit 
Bank of Jackson £md the Farm Credit Bank of Texas 
prior to or effective with the date of the merger. 
"(iii) OTHER ASSISTANCE.—Until the expiration of 
5 years from the effective date of a merger authorized 
by this subsection, or the final resolution of any litiga-
tion against the Federal Intermediate Credit Bank of 
Jackson or any of its stockholders pending on the date 
of the enactment of this subsection, whichever is later, 
the Corporation shall guarantee prompt payment of 
any loss experienced by the merged bank, which loss 
is caused by the failure of any association-stockholder 
of the merged bank that was a stockholder of the 
Federal Intermediate Credit Bank of Jackson imme-
diately prior to the merger, or any successor to the 
association, to pay when due any obligation of principal 
or interest owed by the association or its successor 
to the resulting bank. 
"(iv) TERMS AND CONDITIONS.—Assistance provided 
by the Corporation under this subparagraph shall be 
on such teims and conditions as the Corporation deems 
appropriate to faciUtate the merger. 
"(I) SAFETY AND SOUNDNESS.— 
"(i) IN GENERAL.—^Except as provided in clause 
(ii), if at any time prior to the completion of the merger 
required under this subsection the Farm Credit 
Administration determines that the Federal Intermedi-
ate Credit Bank of Jackson is being operated in an 
unsafe or unsoimd manner (as determined in accord-
ance with the Farm Credit Act of 1971 (12 U.S.C. 
2001 et seq.)), the Farm Credit Administration, after 
consultation with the respective boards of directors 
of the affected banks and taking into consideration 
the purposes of this subsection, may require the Fed-
eral Intermediate Credit Bank of Jackson to merge 
with a Farm Credit Bank, subject to such terms and 
conditions as the Farm Credit Administration may pre-
scribe. The Farm Credit System Insurance Corporation 
shall expend amounts in the Farm Credit Insurance 
106 STAT. 4126 
PUBLIC LAW 102-552—OCT. 28, 1992 
Fund to the extent necessary to facilitate the merger 
prescribed under this subpciragraph, including the 
provision of assistance as provided in section 
5.61(aX2)(AXiii) of the Farm Credit Act of 1971 (12 
U.S.C. 2277a-10(aX2)(A)(iii)), on such terms and condi-
tions as the Corporation deems appropriate. 
"(ii) ARBITRATED MERGER.—If at any time after 
the Farm Credit Administration issues an order under 
paragraph (IXD), but prior to the completion of the 
merger required under this subsection, the Farm 
Credit Administration determines that the Federal 
Intermediate Credit Bank of Jackson is being operated 
in an imsafe or unsound manner (as determined in 
accordance with the Farm Credit Act of 1971 (12 U.S.C. 
2001 et seq.)), the Farm Credit Administration shall, 
after consultation with the boards of directors of the 
Federal Intermediate Credit Bank of Jackson and the 
Farm Credit Bank of Texas, take such action as it 
deems necessary pursuant to the authorities provided 
under the Farm Credit Act of 1971 (12 U.S.C. 2001 
et seq.) to return the operation of the Federal Inter-
mediate Credit Bank of Jackson to a safe and sound 
condition, pending the completion of the merger under 
paragraph (2). 
"(J) MERGER PLAN FOR AGRICULTURAL CREDIT ASSOCIA-
TIONS.—In any of the States of Alabama, Louisiana, or 
Mississippi where all of the associations are chartered as 
agricultural credit associations, the boards of directors of 
each such association in each State are encouraged to sub-
mit to the farmer-borrowers of each such association for 
their approval a plan for merging the associations into 
one statewide agricultural credit association, in accordance 
with the applicable provisions of the Farm Credit Act of 
1971 (12 U.S.C. 2001 et seq.). 
"(K) DEFINITIONS.—^As used in this paragraph: 
"(i) AGRICULTURAL CREDIT ASSOCIATION.—^The term 
'agricultural credit association' means an association 
having the same authorities, attributes, and obligations 
as, and for all purposes an agricultural credit associa-
tion resulting from the implementation of the plan 
under this paragraph shall be deemed to be, an associa-
tion resulting from the merger of a production credit 
association and a Federal land bank association under 
section 7.8 of the Farm Credit Act of 1971 (12 U.S.C. 
2279C-1). 
"(ii) FARMER-BORROWER.—The term 'farmer-bor-
rower* means a borrower from a Farm Credit System 
association in the State of Alabama, Louisiana, or Mis-
sissippi who holds voting stock, or is eligible to hold 
voting stock, in the association or a stockholder in 
any such association. 
"(3) REVIEW.— 
"(A) IN GENERAL.—^Actions and determinations of the 
arbitrator, the Farm Credit Administration, or the Farm 
Credit System Insurance Corporation piu*suant to this sub-
section shall not be subject to judicial review except as 
provided in this paragraph, nor shall they be subject to 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4127 
the requirements of subchapter II of chapter 5 or chapter 
7 of title 5, United States Code. 
"(B) AGENCY DETERMINATIONS.— 
"(i) IN GENERAL.—^Any petition for review of a 
determination or other action of the Farm Credit 
Administration or the Farm Credit System Insurance 
Corporation under this subsection shall be filed in 
the United States Court of Appeals for the District 
of Columbia Circuit not later than 10 days after the 
determination, or the petition shall be barred. The 
court shall have exclusive jurisdiction to determine 
the proceeding in accordance with standard procedures 
as supplemented by procedures hereinafter provided 
and no other district court or court of appeals of the 
United States shall have jurisdiction over any such 
challenge in any proceeding instituted prior to, on, 
or after the date of enactment of this subsection. The 
review of any determination or action of the Farm 
Credit Administration or the Farm Credit System 
Insurance Corporation under this subsection shall be 
based on the examination of all of the information 
before the Farm Credit Administration or the Farm 
Credit System Insurance Corporation, as the case may 
be, at the time the determination was made. The coiirt 
reviewing the determination or action shall not enter 
a stay or order of mandamus unless the court has 
determined, after notice and a hearing before a panel 
of the court, that the agency action complained of 
was arbitrary, capricious, an abuse of discretion, or 
otherwise not in accordance with law. 
"(ii) PROCEDURES.—^Notwithstanding any 
other 
provision of law, the court may set rules governing 
the procedures of any such proceeding that set page 
limits on briefs and time limits for filing briefs and 
motions and other actions that are shorter than the 
limits specified in the Federal Rules of Civil or Appel-
late Procedure. 
"(iii) EXPEDITED REVIEW.—^Any such proceeding 
before the court shall be assigned for hearing and 
completed at the earliest possible date, and shall be 
expedited in every way. The court shall render its 
final decision relative to any challenge not later than 
50 days from the date the challenge is brought 
unless the court determines that a longer period of 
time is required to satisfy the requirements of the 
Constitution. 
"(C) ARBITRATOR DETERMINATIONS.— 
"(i) IN GENERAL.—Except as otherwise provided 
in this paragraph, any petition for review of a deter-
mination or other action of the arbitrator named under 
paragraph (2) shall be filed in accordance with the 
United States Arbitration Act (9 U.S.C. 1 et seq.). 
Such Act shall apply to the arbitration conducted 
pursuant to paragraph (2) to the same extent as if 
the arbitration were established in a contract evidenc-
ing a transaction in commerce between the Federal 
106 STAT. 4128 
PUBLIC LAW 102-552—OCT. 28, 1992 
Intermediate Credit Bank of Jackson and the Farm 
Credit Bank of 
Texas. 
"(ii) PROCEDURES.—^Notwithstanding the United 
States Arbitration Act (9 U.S.C. 1 et seq.), any petition 
for review of a determination or other action of the 
arbitrator under this subsection shall be filed not later 
than 10 days after the determination, or the petition 
shall be barred. The court specified under sudi Act 
shall have exclusive jurisdiction to determine the 
proceeding in accordance with the applicable proce-
dtures under such Act, as supplemented by procedures 
hereinafter provided, and no other district court shall 
have jurisdiction over any such challenge in any such 
I
)roceeding. Notwithstanding any other provision of 
aw, the court may set rules governing the procedures 
of any such proceeding that set page limits on briefs 
and time limits for filing briefs and motions and other 
actions that are shorter than the limits specified in 
the United States Arbitration Act or the Federal Rules 
of Civil or Appellate Procedure. 
"(iii) EXPEDITED REVIEW.—^Any such proceeding 
before the court shall be assigned for hearing and 
completed at the earliest possible date, and shall be 
expedited in every way. The court shall render its 
final decision relative to any challenge as soon as pos-
sible in accordance with the United States Arbitration 
Act (9 U.S.C. 1 et sea.), or not later than 30 days 
fi*om the date the challenge is brought, whichever is 
sooner, luiless the court determines that a longer 
period of time is required to satisfy the requirements 
of the Constitution.". 
12 use 2011 
(b) LONG-TERM LENDING AUTHORITY OF THE FARM CREDIT BANK 
O
F TEXAS WITH RESPECT TO THE STATES OF ALABAMA, LOUISIANA, 
A
N
D MISSISSIPPI.— 
(1) IN GENERAL.—^Notwithstanding any other provision of 
law, the Farm Credit Bank of Texas may act in accordance 
with the exclusive charter of the bank, as amended by the 
Farm Credit Administration on February 7, 1989, and effective 
February 9, 1989 (except to the extent that the charter may 
be fiirther amended by the Farm Credit Administration in 
accordance with its general authorities under the Farm Credit 
Act of 1971 (12 U.S.C. 2001 et seq.), subject to such limitations 
on the issuance of competitive cnarters as may be provided 
in section 5.17 of such Act (12 U.S.C. 2252)). 
(2) EFFECTIVE DATE.—^Paragraph (1) shall take effect as 
if such paragraph had become law on February 7,1989. 
(c) DENIAL OF COMPETITIVE CHARTERS.—Section 5.17(aX2) (12 
U.S.C. 2252(aX2)) is amended— 
(1) by inserting "(A)" afl»r "(2)"; and 
(2) by adding at the end the following new subparagraphs: 
"(B) The Farm Credit Administration shall not issue a 
charter to, or approve an amendment to the charter of, any 
institution of the Farm Credit System to operate under title 
I or II that would authorize the institution to exercise lending 
autiiority, whether directly or indirectly as an agent of a Farm 
Credit Bank, in a territory in which the charter of another 
such institution authorizes the other institution to exercise 
note. 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4129 
like authority, whether directly or indirectly as an agent of 
a Farm Credit Bank, except with the approval of— 
"(i) in a case affecting only the charter of one or more 
associations— 
"(I) a msgority of the shareholders (present and 
voting or voting by proxy) of each of the associations 
that would have like lending authority (whether 
directly or indirectly as an agent of a Farm Credit 
Bank) in any of that territory if the charter action 
were taken; and 
"(11) a mcgority of the board of directors of the 
Farm Credit Bank with which the affected associations 
are affiUated; or 
"(ii) in a case affecting the charter of one or more 
banks— 
"(I) a mcgority of the shareholders (present and 
voting or voting by proxy) of the affiliated associations 
of each of the bai^ tiiat would have like lending 
authority in any of that territory if the charter action 
were taken; 
"(11) a msgority of the shareholders (present and 
voting or voting by proxy) of each of the bcuiks that 
would have like lending authority in any of that terri-
tory if the charter action were taken; and 
"(III) a mcgority vote of the boards of directors 
of each of the banks that woiild have like lending 
authority in any of that territory if the charter action 
were taken. 
"(C) Subparagraph (B) shall apply only in those geographic 
areas where, due to the failure of a Federal intermediate credit 
bank to merge in accordance with section 41(Ka) of the Agricul-
tural Credit Act of 1987 (12 U.S.C. 2011 note), the Federal 
intermediate credit bank or its successor is chartered to provide 
short- and intermediate-term credit, and a neighboring Farm 
Credit Bank that is not the successor to the Federal intermedi-
ate credit bank is chartered to provide long-term credit, in 
the same geographic territory.". 
TITLE V—MISCELLANEOUS 
SEC. 501. VALUATION RESERVES OF PRODUCTION CREDIT ASSOCIA-
TIONS. 
Subsection (b) of section 2.3 (12 U.S.C. 2074(b)) is amended 
to read as follows: 
"(b) APPUCATION OP EARNINGS.—At the end of each fiscal year, 
each production credit association shall apply the amount of t^e 
earnings of the association for the fiscal year in excess of the 
operating expenses of the association (inclucung provision for valu-
ation reserves agsdnst loan assets in accordance with generally 
accepted accounting principles)— 
"(1) first, to the restoration of the impairment (if any) 
of capital; and 
(2) second, to the establishment and maintenance of the 
surplus accoimts, the minimum aggregate amoimt of which 
shall be prescribed by the Farm Credit Bank.". 
106 STAT. 4130 
PUBLIC LAW 102-552—OCT. 28, 1992 
SEC. 502. RISK MANAGEMENT PARTICIPATION AUTHORITY. 
Section 3.1(11) (12 U.S.C. 2122(11)) is amended— 
(1) by inserting "(A)" after "(11)"; and 
(2) by adding at the end the following new subparagraph: 
"(BXi) Participate in any loan of a type otherwise autiiorized 
under this title that is made to a similar entity by any institution 
in the business of extending credit, including purchases of participa-
tions in loans to finance international trade transactions involvmg 
the sale of agricultural commodities or the products thereof, except 
that^ 
"(I) a bank for cooperatives may not participate in a loan— 
"(aa) if the participation would cause the total amoimt 
of all loan participations by the bank under this subpara-
graph involving a single credit risk to exceed 10 percent 
of the bank's total capitial; or 
"(bb) if the participation by the bank will itself eaual 
or exceed 50 percent of the principal of the loan or, wnen 
t£iken together with participations in the loan by the other 
banks for cooperatives under this subparagraph, will cause 
the cumulative amoimt of the participations by all banks 
for cooperatives in the loan to equal or exceed 50 percent 
of the principal of the loan; 
"(II) a bank for cooperatives may not participate in a loan 
to a similar entity under this subparagraph if the similar 
entity has a loan or loan commitment outstanding with a Farm 
Credit Bank or an association chartered imder this Act, unless 
agreed to bv the Bank or association; and 
"(III) the cumulative amount of participations that a bank 
for cooperatives may have outstanding imder this subparagraph 
at any time may not exceed 15 percent of the bsuik's total 
assets. 
"(ii) As used in this subparagraph, the term 'similar entity^ 
means an entity that, while not eligible for a loan under section 
3.8, is functionally similar to an entity eligible for a loan under 
section 3.8 in that it derives a majority of its income from, or 
has a majority of its assets invested in, the conduct of activities 
functionally similar to those conducted by the entity. 
"(iii) With respect to similar entities that are eligible to borrow 
from a Farm Credit Bank or association under title I or II, the 
authority of a bank for cooperatives to participate in loans to 
the entities under this subparagraph shall be subject to the prior 
approval of the Farm Credit Bank or Banks in whose chartered 
territoiy the entity is eligible to borrow. The approval may be 
granted on an annual basis and under such terms and conditions 
as may be agreed on between the bank for cooperatives and the 
Farm Credit Bank or Banks that serve the territory.". 
SEC. 503. EQUmr VOTING FOR ONE DIRECTOR OF EACH BANK FOR 
COOPERATIVES. 
Section 3.2(a) of the Farm Credit Act of 1971 (12 U.S.C. 2123(a)) 
is amended— 
(1) by inserting "(1)" after "(a)"; and 
(2) by adding at the end the following new paragraph: 
"(2XA) If approved by the stockholders through a bvlaw amend-
ment, the nomination and election of one member from a bank 
for cooperatives (other than the National Bank for Cooperatives) 
shall be carried out with each voting stockholder of a bank for 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4131 
cooperatives having one vote, plus a number of votes (or fractional 
part thereof) equal t o ^ 
"(i) the number of stockholders eligible to vote; multiplied 
by 
"(ii) the percentage (or fractional part thereof) of the total 
equity interest (incluoing allocated, but not unallocated, suiplus 
and reserves) in the bank of all stockholders held by the individ-
ual voting stockholder at the close of the immediately preceding 
fiscal year of the bank. 
"(B) The total number of votes under this paragraph shall 
be the number of voting stockholders of a bank for cooperatives 
multiplied by two.". 
SEC. 504. TECHNICAL AMENDMENT. 
The first sentence of section 3.7(a) (12 U.S.C. 2128(a)) is amend-
ed by inserting "at any time (whether or not they have a loan 
from the bank outstanding)" £ifter "technical and financial assist-
ance". 
SEC. 505. EXPANSION OF WATER AND SEWER LENDING AUTHORITY 
OF BANKS FOR COOPERATIVES. 
Section 3.7(f) (12 U.S.C. 2128(f)) is amended— 
(1) by striking "the installation, expansion, or improvement 
of" and inserting "installing, maintaining, expanding, improv-
ing, or operating^; and 
(2) by striking "to extend" and inserting "extending". 
SEC. 506. EUGmiLITY TO BORROW FROM A BANK FOR COOPERA-
TIVES. 
Section 3.8(bXl) (12 U.S.C. 2129(bXl)) is amended by adding 
at the end the following new subparagraph: 
"(E) Any creditworthy private entity that satisfies the 
requirements for a service cooperative under paragraphs (1), 
(2), and (4) of subsection (a) and subsidiaries of the entity, 
if the entity is organized to benefit agriculture in furtherance 
of the welfare of its farmer-members and is operated on a 
not-for-profit basis.". 
SEC. 507. NON-VOTING REPRESENTATIVE ON BOARD OF FUNDING 
CORPORATION. 
Paragraph (2) of section 4.9(d) (12 U.S.C. 2160(dX2)) is amended 
to read as follows: 
"(2) NON-VOTING REPRESENTATIVES.— 
"(A) ASSISTANCE BOARD.—During the period in which 
the Assistance Board is in existence, the board of directors 
of the Assistance Board shall designate one of its directors 
to serve as a non-voting representative to the board of 
directors of the Corporation. 
"(B) MEETINGS.—^The person designated by the Assist-
ance Board under subparagraph (A) may attend and 
participate in all deliberations of the board of directors 
of the Corooration. 
"(C) TERMINATION OF ASSISTANCE BOARD.—After termi-
nation of the Assistance Board, neither the Assistance 
Board nor its successor, the Farm Credit System Insurance 
Corporation, shall have any representation on the board 
of directors of the Corporation.". 
106 STAT. 4132 
PUBLIC LAW 102-552—OCT. 28, 1992 
SEC. 508. REPEAL OF PROHIBinON AGAINST GUARANTEE OF CER* 
TAIN INSTRUMENTS OF INDEBTEDNESS. 
Section 4.16 (12 U.S.C. 2204) is repealed. 
SEC. 509. COMPENSATION OF BANK DIRECTORa 
Section 4.21 (12 U.S.C. 2209) is amended to read as follows: 
•^EC. 4.21. COMPENSATION OF BANK DIRECTORS. 
"(a) IN GENERAL.—^The Farm Credit Administration shall mon-
itor the compensation of members of the board of directors of 
a System bank received as compensation for serving as a director 
of tne bank to ensure that the amount of the compensation does 
not exceed a level of $20,000 per ye£ir, as a4justed to reflect changes 
in the Consumer Price Index for all urban consumers published 
by the Bureau of Labor Statistics, imless the Farm Credit Adminis-
tration determines that such level adversely affects the safety and 
soundness of the bank. 
"(b) WAIVER.—^The Farm Credit Administration may waive the 
Hmitation prescribed in subsection (a) imder exceptional cir-
cumstances, as determined in accordance with regulations promul-
gated by the Farm Credit Administration.". 
SEC. 510. CLARIFICATION OF TREATMENT OF FARM CREDIT ADMINIS-
TRATION OPERATING EXPENSES. 
Section 5.15(bXl) (12 U.S.C. 2250(bXl)) is amended— 
(1) by inserting ", for purposes of sequestration," after 
"regard"; and 
(2) by striking "or any other law". 
SEC. 51L APPROVAL OF COMPETITIVE CHARTERS. 
Section 5.17(a) (12 U.S.C. 2252(a)) is amended by adding at 
the end the following new paragraphs: 
"(13XA) Subject to subparagraph (B), the Farm Credit 
Administration may approve an amendment to the charter 
of any institution of the Farm Credit System operating under 
title 1 or II, which would authorize the institution to exercise 
lending authority in any territory— 
"(i) in the geographic area served by an association 
that was reassigned pursuant to section 433 of the Agricul-
tural Credit Act of 1987 (12 U.S.C. 2071 note) (where 
the geographic area was a part of the association's territory 
as of the date of the reassignment); and 
"(ii) in which the charter of an institution that is 
not seeking the charter amendment authorizes the institu-
tion to exercise the type of lending authority that is the 
subject of the charter request. 
"(B) The Farm Credit Administration may approve a char-
ter amendment imder subparagraph (A) only on the approval 
o
f
— 
"(i) the respective boards of directors of the associations 
that, if the charter request is approved, would exercise 
like lending authority in any of the territory that is the 
subject of the charter request; 
"(ii) a majority of the stockholders of each association 
described in clause (i) voting, in person or by proxy, at 
a duly authorized stockholders' meeting; and 
"(iii) the respective boards of directors of the Farm 
Credit Banks that, if the charter request is approved, would 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4133 
exercise, either directly or through associations, like lend-
ing authority in any of the territory described in subpara-
graph (A)(i). 
"(14)(A) Subject to subparagraph (B), the Farm Credit 
Administration may approve a request to charter an association 
of the Farm Credit System to operate under title II where 
the proposed charter— 
"(i) will include any of the geographic area included 
in the territory served by an association that was 
reassigned pursuant to section 433 of the Agricultural 
Credit Act of 1987 (12 U.S.C. 2071 note) (where the 
geographic area was a part of the association's territory 
as of the date of the reassignment); and 
"(ii) will authorize the association to exercise lending 
authority in any territory in the geographic area in which 
the charter of an association that is not requesting the 
charter authorizes the association to exercise the type of 
lending authority that is the subject of the charter request. 
"(B) The Farm Credit Administration may approve a char-
ter request under subparagraph (A) only on the approval of— 
"(i) the respective boards of directors of the associations 
that, if the charter request is approved, would exercise 
like lending authority in any of the territory that is the 
subject of the charter request; 
"(ii) a majority vote of the stockholders (if any) of 
each association described in clause (i) voting, in person 
or by proxy, at a duly authorized stockholder's meeting; 
and 
"(iii) the respective boards of directors of the Farm 
Credit Banks that, if the charter request is approved, would 
exercise, either directly or through associations, like lend-
ing authority in any of the territory described in subpara-
graph (A)(i).". 
SEC. 512. EXAMINATIONS. 
The third sentence of section 5.19(a) (12 U.S.C. 2254(a)) is 
amended by striking "shall include" and inserting "may include, 
if appropriate". 
SEC. 513. AUTHORITY TO EXAMINE SYSTEM INSTITUTIONS. 
(a) AUTHORITY OF FARM CREDIT SYSTEM INSURANCE CORPORA-
TION.—Section 5.59 (12 U.S.C. 2277a-8) is amended— 
(1) in the section heading, by striking "INSURED SYSTEM 
BANKS" and inserting "SYSTEM INSTITUTIONS"; and 
(2) by striking subsection (b) and inserting the following 
new subsection: 
"(b) EXAMINATION OF SYSTEM INSTITUTIONS.— 
"(1) EXAMINATION AUTHORITY.— 
"(A) IN GENERAL.—If the Board of Directors considers 
it necessary to examine an insured System bank, a produc-
tion credit association, an association making direct loans 
imder the authority provided under section 7.6, or any 
System institution in receivership, the Board may, using 
Farm 
Credit Administration 
examiners, conduct 
the 
examination using reports and other information on the 
System institution prepared or held by the Farm Credit 
Administration. 
106 STAT. 4134 
PUBLIC LAW 102-552—OCT. 28, 1992 
"(B) REQUEST FOR ADDITIONAL EXAMINATION OR OTHER 
INFORMATION.—If the Board determines that such reports 
or information are not adequate to enable the Corporation 
to carry out the duties of tne Corporation imder this sub-
section, the Board shall request the Farm Credit Adminis-
tration to examine or to obtain other information from 
or about the System institution and provide to the Corpora-
tion the resulting examination report or such other 
information. 
"(2) APPOINTMENT OF EXAMINERS.—If the Farm Credit 
Administration informs the Corporation that the Farm Credit 
Administration is unable to comply with a request made under 
paragraph (IXB) with respect to a System institution, the Board 
may appoint examiners to examine the institution. 
"(3) POWERS AND REPORT.—Each examiner appointed under 
paragraph (2) shall make such examination of the affairs of 
the System institution as the Board may direct, and shall 
make a full and detailed report of the examination to the 
Corporation. 
"(4) APPOINTMENT OF CLAIM AGENTS.—The Board of Direc-
tors of the Corporation shall appoint claim agents who may 
investigate and examine all claims for insured obligations. . 
(b) DUTIES OF THE FARM CREDIT ADMINISTRATION.—Section 
5.19 (12 U.S.C. 2254) is amended by adding at the end the following 
new subsection: 
"(d) On receipt of a request made imder section 5.59(bXlXB) 
with respect to a System institution, the Farm Credit Administra-
tion shall— 
Confidentiality. 
"(1) fumish for the Confidential use of the Farm Credit 
Reports. 
System Insuranct Corporation reports of examination of the 
institution and other reports or information on the institution; 
and 
"(2)(A) examine, or obtain other information on, the institu-
tion and fumish for the confidential use of the Farm Credit 
System Insurance Corporation the report of the examination 
and such other information; or 
"(B) if the Farm Credit Administration Board determines 
that compliance with the request would substantially impair 
the ability of the Farm Credit Administration to carry out 
the other duties and responsibilities of the Farm Credit 
Administration under this Act, notify the Board of Directors 
of the Farm Credit System Insurance Corporation that the 
Farm Credit Administration will be unable to comply with 
the request.**. 
SEC. 614. FINANCIAL DISCLOSURE AND CONFUCT OF INTEREST 
REPORTING BY DIRECTORS, OFFICERS, AND EMPLOYEES 
OF FARM CREDIT SYSTEM INSTITUTIONS. 
(a) FINDINGS.—Congress finds that— 
(1) the disclosure of the compensation paid to, loans made 
to, and transactions made with a Farm Credit System institu-
tion by, directors and senior officers of the institution provides 
the stockholders of the institutions with information necessaiy 
to better manage the institutions, provides the Farm Credit 
Administration with information necessary to efficiently and 
effectively regulate the institutions, and enhances the financial 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4135 
integrity of the Farm Credit System by making the information 
available to potential investors; 
(2) the reporting of potential conflicts of interest by direc-
tors, officers, and employees of institutions of the Farm Credit 
System benefits the stockholders of the institutions, helps to 
ensure the financial viability of the institutions, provides 
information valuable to the Farm Credit Administration in 
periodic examinations 
of the institutions, and 
therefore 
enhances the safety and soimdness of the Farm Credit System; 
and 
(3) the directors, officers, or employees of some Farm Credit 
System institutions may not be subject to the regulations of 
the Farm Credit Administration requiring the disclosure of 
the financial information and the reporting of the potential 
conflicts of interest. 
(b) PURPOSE.—It is the purpose of this section to ensure that 
^ 
the information reported by the directors, officers, and employees 
of Farm Credit System institutions under regulations of the Farm 
Credit Administration requiring the disclosure of financial informa-
tion and the reporting of potential conflicts of interest— 
(1) provides the stockholders of all Farm Credit System 
institutions with information to assist the stockholders in 
making informed decisions regarding the operation of the 
institutions; 
(2) provides investors and potential investors with informa-
tion necessary to assist them in making investment decisions 
regarding Farm Credit System obligations or institutions; and 
(3) provides the Farm Credit Administration with informa-
tion necessarv to allow the Farm Credit Administration to 
effectively and efficiently examine and regulate all Farm Credit 
System institutions and thus enhance the safety and soundness 
of the Farm Credit System. 
(c) REVIEW.—^Not later than 120 days after the date of enact-
ment of this Act, the Farm Credit Administration shall complete 
a review of the current regulations of the Farm Credit Administra-
tion regarding the disclosure of financial information and the report-
ing of potential conflicts of interest by the directors, officers, and 
employees of Farm Credit System institutions. Consistent with 
the purpose of this section as provided in subsection (b), the review 
shall address whether the regulations— 
(1) are adequate to fulfill the purpose of this section and 
such other purposes as the Farm Credit Administration deter-
mines to be consistent with the Farm Credit Act of 1971 (12 
U.S.C. 2001 et seq.), and other applicable law, and to be other-
wise necessary or appropriate; 
(2) currently require the disclosure of financial information 
and the reporting of potential conflicts of interest by the direc-
tors, officers, andf employees of all Farm Credit System institu-
tions; and 
(3) currently require the disclosure or reporting of the 
information by all of the appropriate directors, officers, or 
employees of Farm Credit System institutions. 
(d) IMPLEME^^^ATION,—Not later than 360 days after the date Regulations. 
of enactment of this Act, the Farm Credit Administration shall 
amend its ciurent financial disclosure and conflict of interest regula-
tions as the Administration determines necessary to carry out the 
purpose of this section and to address any deflciencies in the regula-
106 STAT. 4136 
PUBLIC LAW 102-552—OCT. 28, 1992 
tions that the Farm Credit Administration determines necessary 
pursuant to the review conducted under subsection (c). 
SEC. 515. ONE-TIME EFAP ASSISTANCE. 
(a) USE OF ACCOUNT.—^The Secretary of Agriculture shall use 
the account in which fimds appropriated imder section 214 of the 
Emergency Food Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 
612c note) are credited or deposited, or another accoimt established 
for the use of the Secretary of Agriculture, for the purpose of 
purchasing, processing and (ustributing additional commodities for 
the emergency food assistance program established under such 
Act (7 U.S.C. 612c note) as required by this section. 
(b) USE OF RECEIPTS.— 
(1) IN GENERAL.—Not later than 10 days after the date 
of enactment of this Act, the Director of the Office of Manage-
ment and Budget shall— 
(A) calculate the estimated present value of the future 
receipts available to the Federal Government, under proce-
dures or definitions established in the Federal Credit 
Reform Act of 1990 (2 U.S.C. 661 et seq.), as a result 
of enactment of this Act and the amendments made by 
this Act; and 
(B) advise the Secretary of Agriculture, the Committee 
on Agriculture of the House of Representatives, and the 
Committee on Agriculture, Nutrition, and Forestry of the 
Senate of the dollar amount of that value. 
(2) CREDIT.—Not later than 20 days after the date of enact-
ment of this Act, an amount equal to the dollar amount of 
that value shall be credited to, or deposited in, the account 
referred to in subsection (a) hjr the Secretary of the Treasury. 
(c) REQUIRED PURCHASE OF (JOMMODITIES BY THE SECRETARY 
OF AGRICULTURE.— 
(1) IN GENERAL.—^The Secretary of A^culture shall— 
(A) use all of the funds provided to the Secretary 
imder subsection (a) to purchase, process, and distribute 
additional commodities for the emergency food assistance 
program; and 
(B) allot the additional commodities to States in accord-
ance with the application of the allocation formula estab-
lished in section 214(f) of the Emergency Food Assistance 
Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note) to 
the total value of the additional commodities. 
(2) TYPES AND VARIETIES.—The additional commodities 
shall be of the types and varieties required under section 214(d) 
of such Act. 
(3) REALLOCATION.—^The additional commodities may be 
reallocated imder procedures established by the Secretary of 
Agnculture in accordance with section 214(g) of such Act. 
(d) ENTITLEMENT TO RECEIVE COMMODITIES.—Each State shall 
be entitled to receive during fiscal year 1993 its allotment of the 
additional commodities purchased by the Secretary of Agriculture 
under this section. 
(e) TERMINATION OF AUTHORITY.—^The authority provided to 
carry out this section shall terminate on September 30,1993. 
SEC. 516. TECHNICAL CORRECTIONS. 
(a) CORRECTION OF REFERENCE TO SECTION 1236 OF THE FOOD 
SECURITY ACT OF 1985.—^The matter under the heading "CONSTRUC-
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4137 
HON A
N
D A
N
A
D
R
O
M
O
U
S FISH" of title I of the Department of the 
Interior and Related Agencies Appropriations Act, 1991 (Public 
Law 101-512; 104 Stat. 1918) is amended by striking 'iitle 16 1
6 use 3832. 
U.S.C. section 3832(aX6r and inserting "section 1232(aX6) of the 
Food Security Act of 1985 (16 U.S.C. 3832(aX6)r. 
(b) SECTION 1245(b) OF THE FOOD SECURITY ACT OF 1985.— 
(1) CORRECTION.—Section 1245(b) of the Food Security Act 
of 1985 (16 U.S.C. 3845(b)) is amended by striking '\A) through 
(G)" and inserting "A throurfi G". 
(2) EFFECTIVE DATE.—The amendment made by paragraph 16 use 3845 
(1) shall take effect immediately after section 1443 of the Food, ^°^-
Agriculture, Conservation, and Trade Act of 1990 (Public Law 
101-624; 104 Stat. 3602) took effect. 
(c) SECTION 307(aX6XB) OF THE CONSOLIDATED FARM AND 
RURAL DEVELOPMENT ACT.— 
(1) CORRECTION.—Section 307(aX6XB) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 1927(aX6XB)) is 
amended by striking clause (ii), and by redesignating clauses 
(iii) througn (viii) as clauses (ii) through (vii), respectively. 
(2) EFFECTIVE DATE.—The amendments made by paragraph ^ use 1927 
(1) of this subsection shall take effect at the same time as "°^-
the amendments made by section 501(a) of the Food, Agri-
culture, Conservation, and Trade Act Amendments of 1991 
(Public Law 102-237; 105 Stat. 1865) took effect. 
(d) SECTION 310B(C) OF THE CONSOLIDATED FARM AND RURAL 
DEVELOPMENT ACT.—Section 310B(c) (7 U.S.C. 1932(c)) is amended 
by striking 'business enterprises," and inserting 'Ibusiness enter-
f
>rises or the creation, expansion, and operation of rural distance 
earning networks or rural learning programs that provide edu-
cational instruction or job training instruction related to potential 
employment or job advancement to adult students,". 
(e) SECTION 310D(a) OF THE CONSOLIDATED FARM AND RURAL 
DEVELOPMENT ACT.— 
(1) CORRECTION.—Section 310D(a) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 1934(a)) is amended 
by striking "304(dXl)" and inserting •'304(aXl)". 
(2) EFFECTIVE DATE.—The amendment made by paragraph 7 use 1934 
(1) of this subsection shall take effect at the same time as ^°*^-
the amendments made by section 501(a) of the Food, Agri-
culture, Conservation, and Trade Act Amendments of 1991 
(Public Law 102-237; 105 Stat. 1865) took effect. 
(f) SECTION 312(a) OF THE CONSOUDATED FARM AND RURAL 
DEVELOPMENT ACT.— 
(1) REPLACEMENT OF UNEXECUTABLE AMENDMENT MADE BY 
THE FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF 
1990.— 
(A) CORRECTION.—Subsection (b) of section 1818 of the 
Food, Agriculture, Conservation, and Trade Act of 1990 
(Public Law 101-624; 104 Stat. 3830) is amended to read ^ use 1942. 
as follows: 
"(b) OPERATING LOAN PURPOSES.—The first sentence of section 
312(a) (7 U.S.C. 1942(a)) is amended— 
"(1) by striking 'and' at the end of clause (11); and 
"(2) by inserting', and (13) borrower training under section 
359' before the peri^ at the end.". 
(B) EFFECTIVE DATE.—The amendment made by 7 use 1942 
subparagraph (A) shall take effect as if included in the "°^ 
106 STAT. 4138 
PUBLIC LAW 102-552—OCT. 28, 1992 
Food, Agriculture, Conservation, and Trade Act of 1990 
at the time such Act became law. 
(2) REPEAL OF UNEXECUTABLE AMENDMENT MADE BY THE 
FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT AMEND-
MENTS OF 1991.—Subsection (b) of section 501 of the Food, 
Agriculture, Conservation, and Trade Act Amendments of 1991 
7 use 1942 
(Public Law 102-237; 105 Stat. 1866) is repealed. The Consoli-
andnote. 
^g^^^ Yarm and Rural Development Act (7 U.S.C. 1921 et 
seq.) shall be applied and administered as if such subsection 
had never become law. 
(g) AMENDMENTS TO SECTION 33 IE OF THE CONSOLIDATED FARM 
AND RURAL DEVELOPMENT ACT.— 
(1) CORRECTION.—Section 331E of the Consolidated Farm 
and Rural Development Act (7 U.S.C. 1981e) is amended— 
(A) in subsection (a), by striking "Disaster Relief Act 
of 1974" and inserting "Robert T. Stafford Disaster Relief 
V 
and Emergency Assistance Act (42 U.S.C. 5121 et seq.)"; 
and 
(B) in subsection (b), by inserting "Robert T. Stafford" 
before "Disaster Relief^. 
7 use I98ie 
(2) EFFECTIVE DATE.^The amendments made by paragraph 
'^°*®- 
(1) of this subsection shall take effect immediately after section 
501(d) of the Food, Agriculture, Conservation, and Trade Act 
Amendments of 1991 (Public Law 102-237; 105 Stat. 1866) 
took effect. 
(h) SECTION 335(e)(l)(A)(i) OF THE CONSOLIDATED FARM AND 
RURAL DEVELOPMENT ACT.— 
(1) CORRECTIONS TO AMENDMENT MADE BY THE FOOD, AGRI-
CULTURE, CONSERVATION, AND TRADE ACT AMENDMENTS OF 
1991.—Section 501(f)(1) of the Food, Agriculture, Conservation, 
and Trade Act Amendments of 1991 (Public Law 102-237; 
7 use 1985. 
105 Stat. 1867) is amended— 
(A) by inserting "the first place such term appears" 
before "and all that follows"; and 
(B) by striking "borrower-owner (as defined in subpara-
graph (F))" and inserting "the borrower-owner (as defined 
in subparagraph (F))". 
7 use 1985 
(2) EFFECTIVE DATE.—The amendments made by paragraph 
"°^- 
(1) of this subsection shall take effect immediately after section 
501(f) of the Food, Agriculture, Conservation, and Trade Act 
of 1990 took effect. 
(i) SECTION 352(a) OF THE CONSOLIDATED FARM AND RURAL 
DEVELOPMENT ACT.—Section 352(a) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 2000(a)) is amended by redesignat-
ing the second paragraph (4) as paragraph (5). 
(j) SECTION 352(b)(2) OF THE CONSOLIDATED FARM AND RURAL 
DEVELOPMENT ACT.— 
(1) CORRECTION.—Section 352(b)(2) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 2000(bX2)) is 
amended by striking "borrower's" and inserting "borrower-
owner's". 
7 use 2000 
(2) EFFECTIVE DATE.—^The amendment made by paragraph 
"°*®- 
(1) of this subsection shall take effect at the same time as 
the amendments made by section 501(f) of the Food, Agri-
culture, Conservation, and Trade Act Amendments of 1991 
(Public Law 102-237; 105 Stat. 1867) took effect. 
PUBLIC LAW 102-552—OCT. 28, 1992 
106 STAT. 4139 
(k) SECTION 702(hX2) OF THE FOOD, AGRICULTURE, CONSERVA-
TION, AND TRADE ACT AMENDMENTS OF 1991.—Section 702(hX2) 
of the Food, Agricultiire, Conservation, and Trade Act Amendments 
of 1991 (Public Law 102-237; 105 Stat. 1881) is amended by insert- 7 use 1991 
ing "section" before'*2388(hX3r. 
"°*^ 
(1) SECTION 306C(bXl) OF THE CONSOLIDATED FARM AND RURAL 
DEVELOPMENT ACT.—Section 306C(bXl) of the ConsoUdated Farm 
and Rural Development Act (7 U.S.C. 1926c(bXl)) is amended by 
striking "or connecting such systems to the residences of such 
individuals" and inserting ", connecting the systems to the resi-
dences of the individuals, or installing plumbing and fixtures within 
tiie residences of the individuals to facilitate the use of the water 
supply and waste disposal systems". 
(m) SECTION 306C OF THE CONSOLIDATED FARM AND RURAL 
DEVELOPMENT ACT.—Section 306C of the ConsoHdated Farm and 
Rural Development Act (7 U.S.C. 1926c) is amended by adding 
at the end the following new subsection: 
"(f) REGULATIONS.—Not later than 30 days after the date of 
enactment of this subsection, the Secretary shall issue interim 
final regulations, with a request for public comments, implementing 
this section.". 
Approved October 28, 1992. 
LEGISLATIVE HISTORY—H.R. 6125: 
CONGRESSIONAL RECORD, Vol. 138 (1992): 
Oct. 4, considered and passed House. 
Oct. 7, considered and passed Senate.