FCS Provisions Removed From 2007 Farm Bill

Thanks to a strong grassroots effort on the part of the banking industry, last week the House of Representatives stripped the 2007 Farm Bill of provisions further empowering the Farm Credit System. The action was a significant victory in the battle to keep the FCS focused on their mission of serving farmers and ranchers.

The expansion proposals would have harmed financial institutions, resulting in fewer credit and financial services options being available to the thousands of rural communities banks serve. The provisions would have permitted the FCS to move away from its mission to serve agriculture. The FCS is a tax advantaged, direct retail lending GSE chartered by Congress to provide credit to small farmers, ranchers, farmer-owned businesses, and rural home owners.  The new powers sought by the FCS indicated a desire to move away from agriculture into corporate and mortgage lending.

The amendment, sponsored by house financial services committee chairman Barney Frank (D-MA) and ranking member Spencer Bachus (R-AL), passed on a voice vote the evening of July 26. The IBA believes each member of the Iowa delegation supported the IBA position.
 
IBA President and CEO John Sorensen was in Washington D.C. during the two days leading up to the vote, meeting with the Iowa congressional delegation.

“Nearly every office commented on the hundreds of calls and emails they were receiving from bankers,” Sorensen said. “It made our arguments much more persuasive.”
 
Iowa bankers have sent nearly one thousand letters or emails using the Legislative Action Center, a web based communications tool. The Legislative Action Center can be found online at www.iowabankers.com, click on Government Relations.

In addition, three Iowa ag bankers participated in a spring ABA fly-in devoted to the FCS Horizons proposal and talked to members of Congress about the implications of the proposal.
 
The farm credit issue now moves to the Senate where Iowa Senator Tom Harkin will control the committee proceedings. It will be important for Iowa bankers to continue their efforts by contacting the Senator’s office and expressing their views.

Contact Senator Harkin’s Washington D.C. office at 202.224.3254 or fill out the online contact form at www.harkin.senate.gov.