Conservation Loans

To provide financial assistance to eligible applicants for implementing qualified conservation practices as outlined in a conservation plan developed and approved by the Natural Resources and Conservation Services (NRCS).



Agency - Department of Agriculture

Established in 1862, the Department of Agriculture serves all Americans through anti-hunger efforts, stewardship of nearly 200 million acres of national forest and rangelands, and through product safety and conservation efforts. The USDA opens markets for American farmers and ranchers and provides food for needy people around the world.

Office - See Regional Agency Offices.

Contact the appropriate FSA State Office listed in Appendix IV of the Catalog.
(What catalog).


Program Accomplishments

Not Applicable.

Uses and Use Restrictions

Loan funds may be used for conservation activities included in a conservation plan approved by NRCS.

Eligibility Requirements

Applicant Eligibility

An applicant must (1) Not have caused a loss to the Agency after April 4, 1996, or received debt forgiveness on more than three occasions prior to April 4, 1996 to receive a guaranteed loan, and for a direct loan, must not have received debt forgiveness from the Agency on any direct or guaranteed loan; (2) be a U.S.

citizen, non-citizen national or qualified alien; (3) posses the legal capacity to incur the obligations of the loan; (4) for a direct loan, have the necessary education and/or experience, training, and managerial ability to operate a farm; and (5) for a direct loan, fulfill the Agency"s borrower training requirements.

If the applicant is an entity, it must be controlled by farmers engaged primarily and directly in farming in the U.S., after the loan is made.

Unlike other Agency loan programs, Conservation Loans are not limited to applicants who are unable to obtain sufficient credit from other sources at reasonable rates and terms or to those who are the owner or operator of a not larger than family size farm.

However, the applicant"s operation must realistically project the ability to repay the loan.

Assistance is authorized for eligible applicants in the 50 States, the Commonwealth of the Puerto Rico, the Virgin Islands of the United States, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and, to the extent the Secretary determines it to be feasible and appropriate, the Trust Territories of the Pacific Islands.

Beneficiary Eligibility

Applicants are the direct beneficiaries and must meet the applicant eligibility requirements. Families, individual, and entities who are farmers are the beneficiaries.

Credentials/Documentation

No Credentials or documentation are required. This program is excluded from coverage under OMB Circular No. A-87.

Aplication and Award Process

Preapplication Coordination

Preapplication coordination is not applicable.

Environmental impact information is not required for this program.

This program is excluded from coverage under E.O.

12372.

Application Procedures

This program is excluded from coverage under OMB Circular No. A-102. This program is excluded from coverage under OMB Circular No. A-110. The following forms must be submitted by applicants:

For Direct Loans
FSA-2001 Request for Direct Loan Assistance
Must be submitted with supporting information at the applicant"s local FSA county office.

For Loan Guarantees
FSA-2211 Application for Guarantee or FSA-2212 Preferred Lender Application for Guarantee
Must be submitted with supporting information with the prospective lender

Applicants for direct and guaranteed loans must provide an approved NRCS conservation plan that includes the conservation measure for which loan funds are requested.

Award Procedures

Certification as to eligibility is made by the authorized agency official and an approval determination is made by the authorized agency official based on loan feasibility, soundness, and adequate security.

Deadlines

Not Applicable.

Authorization

The Consolidated Farm and Rural Development Act, Title XIV, Part A, Section 304, 7 U.S.C 1924, as amended by The Food, Conservation, and Energy Act of 2008, Title V, Part A, Section 5002, Public Law 110-296, 7 U.S.C 1926.

Range of Approval/Disapproval Time

The authorized agency official must approve or disapprove a completed guaranteed application within 30 days, and a completed direct loan application within 60 days.

Appeals

Applicants for direct and guaranteed loans may appeal an adverse decision. The applicant is given an opportunity to appeal the decision to the National Appeals Division. The applicant may in the final step of the appeal process ask for a review of the decision by the Director of the National Appeals Division in Washington, DC.

Renewals

Applicants may reapply at any time. Applicants denied assistance through the appeal process must establish that substantial change has occurred since the denial decision.

Assistance Considerations

Formula and Matching Requirements

Statutory formulas are not applicable to this program.
This program has no matching requirements. The selected criteria identify essential elements considered necessary to compare the needs of the various States, and to make the best use of available program funds.
MOE requirements are not applicable to this program.

Length and Time Phasing of Assistance

Loans are scheduled for repayment over periods up to 20 years depending on the type of security available. The interest rate for guaranteed loans is negotiated between the lender and borrower. The interest rate for direct loans is determined by the Secretary of Agriculture. Method of awarding/releasing assistance: lump sum.

Post Assistance Requirements

Reports

Not Applicable.

Audits

Not Applicable.

Records

Not applicable.

Financial Information

Account Identification

12-4140-0-3-351 - Guaranteed Conservation Loans; 12-1140-0-1-351 - Direct Conservation Loans.

Obigations

(Direct Loans) FY 09 $0; FY 10 est $75,000,000; FY 11 est $75,000,000 - USDA"s Farm Service Agency makes and guarantees conservation loans.
FY 2010 funding for direct conservation loans $75,000,000.
FY 2011 estimated funding for direct conservation loans $75,000,000. (Guaranteed/Insured Loans) FY 09 $0; FY 10 est $75,000,000; FY 11 est $75,000,000 - USDA"s Farm Service Agency makes and guarantees conservation loans.
FY 2010 funding for guaranteed conservation loans $75,000,000.
FY 2011 estimated funding for guaranteed conservation loans $75,000,000.

Range and Average of Financial Assistance

Maximum indebtedness for direct loans, combined; farm ownership, conservation, soil and water, and recreation $300,000.

Maximum indebtedness for guaranteed loans combined: farm ownership, conservation, and soil and water loan indebtedness of $1,112,000 (for FY 2010, amount adjusted annually for inflation).

Estimated range and average of finanacial assistance is non applicable for FY 2010. New Program being impleneted begining October 1, 2010.

Regulations, Guidelines, and Literature

7 CFR Parts 762 and 764
FSA Handbooks 2-FLP and 3-FLP
FSA Fact Sheets

Information Contacts

Regional or Local Office

See Regional Agency Offices. Contact the appropriate FSA State Office listed in Appendix IV of the Catalog.
(What catalog).

Headquarters Office

Connie Holman, USDA, FSA, Deputy Administrator For Farm Loan Programs, Loan Making Division/ Funds Management Branch, 1400 Independence Ave SW, Stop 0522, Washington, District of Columbia 20250 Email: connie.holman@wdc.usda.gov Phone: (202) 690-0756 Fax: (202) 720-6797.

Criteria for Selecting Proposals

Not Applicable.



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