Notice2024-03687
Revised Loan Volume Requirements for the Preferred Lender Program and the Certified Lender Program
Primary source
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Published
February 23, 2024
Issuing agencies
Agriculture DepartmentFarm Service Agency
Abstract
The Farm Service Agency (FSA) announces the revised loan volume eligibility criteria for existing lenders participating in the Preferred Lender Program (PLP) for FSA guaranteed loans or who have recently participated in PLP but lost that status due to loan volume requirements and wish to reapply. Due to decreased loan demand, many former PLP lenders, who would have otherwise been expected to have renewed their PLP status, have been unable to qualify for the renewal of their status in PLP within the past 5 years due solely to loan volume requirements. This document applies lower loan volume eligibility criteria to PLP lenders who renew their PLP status and to former PLP lenders who reapply for PLP status after losing that status because they were unable to renew due solely to decreased loan volume within the 5 years immediately preceding the date of this notice. FSA also announces the revised loan volume eligibility criteria for all lenders participating in the Certified Lender Program (CLP) for FSA guaranteed loans due to the same decreased loan demand discussed previously. This document applies less restrictive loan volume eligibility criteria to all lenders currently participating in the CLP program and lenders applying to participate in the CLP program.
Full Text
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<title>Federal Register, Volume 89 Issue 37 (Friday, February 23, 2024)</title>
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[Federal Register Volume 89, Number 37 (Friday, February 23, 2024)]
[Notices]
[Pages 13682-13684]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-03687]
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DEPARTMENT OF AGRICULTURE
Farm Service Agency
[Docket ID FSA-2023-0023]
Revised Loan Volume Requirements for the Preferred Lender Program
and the Certified Lender Program
AGENCY: Farm Service Agency, USDA.
ACTION: Notice of eligibility criteria.
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SUMMARY: The Farm Service Agency (FSA) announces the revised loan
volume eligibility criteria for existing lenders participating in the
Preferred Lender Program (PLP) for FSA guaranteed loans or who have
recently participated in PLP but lost that status due to loan volume
requirements and wish to reapply. Due to decreased loan demand, many
former PLP lenders, who would have otherwise been expected to have
renewed their PLP status, have been unable to qualify for the renewal
of their status in PLP within the past 5 years due solely to loan
volume requirements. This document applies lower loan volume
eligibility criteria to PLP lenders who renew their PLP status and to
former PLP lenders who reapply for PLP status after losing that status
because they were unable to renew due solely to decreased loan volume
within the 5 years immediately preceding the date of this notice. FSA
also announces the revised loan volume eligibility criteria for all
lenders participating in the Certified Lender Program (CLP) for FSA
guaranteed loans due to the same decreased loan demand discussed
previously. This document applies less restrictive loan volume
eligibility criteria to all lenders currently participating in the CLP
program and lenders applying to participate in the CLP program.
DATES: Applicable date: February 23, 2024.
FOR FURTHER INFORMATION CONTACT: Matthew T. Henderson; telephone: (202)
720-5847; email: <a href="/cdn-cgi/l/email-protection#94f9f5e0e0fcf1e3bafcf1faf0f1e6e7fbfaa6d4e1e7f0f5baf3fbe2"><span class="__cf_email__" data-cfemail="91fcf0e5e5f9f4e6bff9f4fff5f4e3e2feffa3d1e4e2f5f0bff6fee7">[email protected]</span></a>. Individuals who require
alternative means for communication should contact the U.S. Department
of Agriculture (USDA) Target Center at (202) 720-2600 (voice and text
telephone (TTY)) or dial 711 for Telecommunications Relay service (both
voice and text telephone users can initiate this call from any
telephone).
SUPPLEMENTARY INFORMATION:
Background
FSA's PLP provides qualifying lenders additional authorities and
streamlined procedures under the FSA guaranteed farm loan programs. In
accordance with the criteria specified in 7 CFR 762.106(c)(3), lenders
who participate in the PLP must meet minimum loan volume thresholds
that are established by FSA and published in a notice in the Federal
Register. On May 5, 1999 (64 FR 24132), FSA established the current PLP
loan volume threshold of 20 FSA guaranteed loans closed in the past 5
years. Also, 7 CFR 762.106(c)(1) states that lenders who participate in
the PLP must meet all requirements of CLP. The CLP loan volume
threshold was established on February 12, 1999 (64 FR 7404). The notice
stated that lenders participating in the CLP must have closed a total
of at least 10 FSA guaranteed loans and at least 5 of those FSA
guaranteed loans must have been closed in the past 2
[[Page 13683]]
years. This resulted in the requirements of 20 loans in the past 5
years and 5 loans in the past 2 years for lenders to meet the loan
volume requirements in 7 CFR 762.106(c)(1) and (3) to obtain PLP
status.
FSA regulations in 7 CFR 762.106(f)(1) specify that the maximum
term for PLP status cannot exceed 5 years and 7 CFR 762.106(f)(3)
specifies that lenders must continue to meet FSA's eligibility
requirements in order to renew their status.
Due to decreases in overall farm lending,\1\ including FSA
guaranteed loans, many existing PLP lenders have been unable to qualify
for the renewal of their status in the PLP within the past 5 years. In
most cases, the lenders whose status was not renewed were well-
established PLP lenders that participated in the program for 10 years
or longer with minimal to no losses. This results in experienced
lenders reverting to either CLP status or Standard Eligible Lender
(SEL) status. Individual guaranteed loan applications submitted under
the SEL or CLP status require more supporting documentation from
lenders, which takes more time for FSA to review. In turn, this results
in delays for producers to receive their loan funds.
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\1\ See Smaller Operating Loans Slow Lending Activity--Federal
Reserve Bank of Kansas City (<a href="http://kansascityfed.org">kansascityfed.org</a>) at <a href="https://www.kansascityfed.org/agriculture/agfinance-updates/smaller-operating-loans-slow-lending-activity/">https://www.kansascityfed.org/agriculture/agfinance-updates/smaller-operating-loans-slow-lending-activity/</a>.
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With this notice, FSA is amending the threshold required for
existing PLP lenders to renew their status and for former PLP lenders
whose status was not renewed due solely to a lack of loan volume within
the past 5 years preceding the publication of this notice when
reapplying for PLP status. This notice revises this PLP renewal
threshold to 10 FSA guaranteed loans closed in the past 5 years. PLP
lenders whose status was not renewed due solely to a lack of loan
volume within the 5 years immediately preceding the date of this notice
must re-apply for PLP status within 180 days from the publication of
this notice in order to be evaluated under the revised loan volume
criteria. Lenders who have never previously held PLP status, lenders
who lost their PLP status more than 5 years ago, or lenders who lost
their PLP status at any time for a reason other than solely a lack of
loan volume must continue to meet the existing requirements of 20 loans
closed in the past 5 years.
This action will allow more experienced PLP lenders to retain their
status in periods of decreased application volume which will result in
faster application turnaround times for both lenders and FSA staff when
reviewing individual guaranteed loan applications from those lenders.
Faster turnaround times ensure that producers receive their loan funds
in a timely manner. Also, limiting the lower threshold of 10 FSA
guaranteed loans closed in the past 5 years only to PLP lenders
renewing their status and to those lenders who recently lost their PLP
status ensures that it applies only to lenders with an established
knowledge of FSA guaranteed loan policies, who stay abreast of any
recent policy changes, as opposed to newer lender applicants who may be
less experienced with FSA's guaranteed loan program requirements.
Lenders who have never previously held PLP status have not yet
demonstrated proficiency under the limited FSA supervision of PLP, so
it is appropriate that they must still meet the higher threshold of 20
loans closed in the past 5 years to initially obtain the PLP status.
FSA's CLP provides lenders with less experience than PLP lenders
the opportunity to operate under a partially streamlined origination
and servicing process for FSA guaranteed loans. In accordance with the
criteria specified in 7 CFR 762.106(b)(4), lenders who participate in
CLP must meet minimum loan volume thresholds that are established by
FSA and published in a notice in the Federal Register. The CLP loan
volume threshold was established on February 12, 1999 (64 FR 7404). The
notice stated that lenders participating in CLP must have closed a
total of at least 10 FSA guaranteed loans and at least 5 of those FSA
guaranteed loans must have been closed in the past 2 years.
Due to the previously cited decreases in farm lending, including
FSA guaranteed loans, many existing CLP and PLP lenders have been
unable to qualify for the renewal of their respective statuses in the
past 5 years. In addition, FSA has found that the inconsistency in the
timeframes for the loan volume requirements (currently 5 years for PLP
and 2 years for CLP) has created confusion and misunderstanding for
both lenders and FSA staff.
Therefore, with this notice, FSA is also amending the threshold
required for existing CLP lenders to renew their status and for new
lenders to qualify for CLP status. This notice revises that CLP loan
volume threshold to 10 FSA guaranteed loans closed in the past 5 years.
Since guaranteed loan applications submitted by CLP lenders have more
strict documentation requirements than those from PLP lenders, it is
appropriate that the loan volume threshold for initially obtaining CLP
status is lower than that for PLP. Additionally, since the new CLP
threshold of 10 loans closed in the past 5 years is more lenient than
the current requirement of 5 loans closed in the past 2 years, FSA does
not see a need for a different threshold for renewal of CLP status. The
following table summarizes the new loan volume requirements for both
the CLP and PLP programs:
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Required number
of loans closed
Scenario in the past 5
years
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New lenders applying for CLP status.................. 10
Existing CLP lenders renewing their status........... 10
New lenders applying for PLP status.................. 20
Existing PLP lenders renewing their status (and 10
former PLP lenders reapplying for PLP status after
losing that status solely due to decreased loan
volume within the 5 years preceding publication of
this notice)........................................
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Note: Former PLP lenders reapplying for PLP status must do so within 180
days of publication of this notice for this lower threshold to apply.
Paperwork Reduction Act Requirements
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501-
3520), the approved information collection under OMB control number
0560-0155 does not change and have any new information collection
requirements.
Environmental Review
The environmental impacts have been considered in a manner
consistent with the provisions of the National
[[Page 13684]]
Environmental Policy Act (NEPA, 42 U.S.C. 4321-4347), the regulations
of the Council on Environmental Quality (40 CFR parts 1500-1508), and
the FSA regulation for compliance with NEPA (7 CFR part 799). The
changes announced in this notice deal with the status of the guaranteed
lender. Each of the underlying proposals submitted by guaranteed
lenders of any status will continue to be fully considered under NEPA
prior to the government guaranteeing any loans for any activities,
including Categorical Exclusions, Environmental Assessments, or
Environmental Impact Statements.
Federal Assistance Programs
The title and number of the Federal assistance programs, as found
in the Assistance Listing \2\ (formerly referred to as the Catalog of
Federal Domestic Assistance), to which this document applies is
10.406--Farm Operating Loans and 10.407--Farm Ownership Loans.
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\2\ See <a href="https://sam.gov/content/assistance-listings">https://sam.gov/content/assistance-listings</a>.
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USDA Non-Discrimination Policy
In accordance with Federal civil rights law and USDA civil rights
regulations and policies, USDA, its agencies, offices, and employees,
and institutions participating in or administering USDA programs are
prohibited from discriminating based on race, color, national origin,
religion, sex, gender identity (including gender expression), sexual
orientation, disability, age, marital status, family or parental
status, income derived from a public assistance program, political
beliefs, or reprisal or retaliation for prior civil rights activity, in
any program or activity conducted or funded by USDA (not all bases
apply to all programs). Remedies and complaint filing deadlines vary by
program or incident.
Individuals who require alternative means of communication for
program information (for example, braille, large print, audiotape,
American Sign Language, etc.) should contact the responsible agency or
the USDA TARGET Center at (202) 720-2600 (voice and text telephone
(TTY)) or dial 711 for Telecommunications Relay Service (both voice and
text telephone users can initiate this call from any telephone).
Additionally, program information may be made available in languages
other than English.
To file a program discrimination complaint, complete the USDA
Program Discrimination Complaint Form, AD-3027, found online at <a href="https://www.usda.gov/oascr/how-to-file-a-program-discrimination-complaint">https://www.usda.gov/oascr/how-to-file-a-program-discrimination-complaint</a> and
at any USDA office or write a letter addressed to USDA and provide in
the letter all the information requested in the form. To request a copy
of the complaint form, call (866) 632-9992. Submit your completed form
or letter to USDA by: (1) mail to: U.S. Department of Agriculture,
Office of the Assistant Secretary for Civil Rights, 1400 Independence
Avenue SW, Washington, DC 20250-9410; (2) fax: (202) 690-7442; or (3)
email: <a href="/cdn-cgi/l/email-protection#ddadafb2baafbcb0f3b4b3a9bcb6b89da8aeb9bcf3bab2ab"><span class="__cf_email__" data-cfemail="f9898b969e8b9894d790978d98929cb98c8a9d98d79e968f">[email protected]</span></a>.
USDA is an equal opportunity provider, employer, and lender.
Zach Ducheneaux,
Administrator, Farm Service Agency.
[FR Doc. 2024-03687 Filed 2-22-24; 8:45 am]
BILLING CODE 3411-E2-P
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