The Independent Community Bankers of America (ICBA) lobbied Congress on Tuesday for a multi-year farm bill and permanent funding mechanisms for U.S. Department of Agriculture (USDA) loans to avert a potential farm credit crisis.
Testifying before a Senate Agriculture Committee hearing titled “Commodities, Crop Insurance and Credit,” Brenda Kluesner, a loan officer and crop insurance manager for Royal Bank in Cassville, Wisconsin, said a multi-year farm bill would enable lenders and farmers to engage in multi-year business deals.
“Congress has the power to help avoid a farm credit crisis,” Kluesner said. “A strong farm safety net for commodities, and a strong crop insurance program, are both vital to producers and community banks.”
Authorizing permanent funding mechanisms for USDA farm loan programs and the USDA Business and Industry program, Kluesner continued, would help avoid a credit crunch that would lead to producers exiting the agriculture sector.
“By enhancing, streamlining and adjusting the USDA guaranteed lending programs in the next farm bill, we will ensure that they fulfill their potential to be a key component of the farm safety net and help prevent the next farm credit crisis,” Kluesner said.
ICBA’s has identified five key priorities for the next farm bill. Among them are sufficient funding for commodities, crop insurance and credit programs; program changes that benefit producers and community banks; reducing regulatory burdens; ensuring equitable treatment of all program participants by agency rules; and complementing private sector lending with direct loan programs.