§1983a Prompt approval of loans and loan guarantees

Summary

Requires the Secretary to quickly decide on loan or loan-guarantee applications and to tell the applicant in writing. If an application is complete, the Secretary must approve or deny it within 60 days. If it is incomplete (except for one part of the law called subchapter II), the Secretary must say why within 20 days. For subchapter II operating loans, the Secretary must tell the applicant what extra information is needed within 10 days, ask other USDA agencies for needed facts (those agencies must reply within 15 days), and if information is still missing after 20 days notify the applicant and the local district office. County offices must tell the district office about applications that are pending more than 45 days and why; the district office then must finish action within 15 days. Each month the Secretary must tell the House and Senate Agriculture Committees, state by state, about any subchapter II application not decided within 60 days and why. If an application is denied, the Secretary must give the reasons. If a denial is only because there are not enough funds for certain loan types (sections 1932(a) or 1926(a)), the application must be put into pending status and reconsidered when funds arrive; applicants must be told whether funding is approved or denied within 60 days after funds become available. Once a loan is approved, the money must be given within 15 days (or longer if the applicant agrees). If funds are not immediately available, the money must be provided as soon as possible, and no later than 15 days unless the applicant agrees to wait. If an appeal reverses a denial and the application returns, the Secretary must act and notify the applicant within 15 days. Decisions on approved-lender designation must be made within 15 days. After December 23, 1985, the Secretary must give enough staff and pay overtime to help the Farmers Home Administration process farmer and rancher loan applications quickly. “Approved lender”: a lender already approved before October 28, 1992, or certified under the law. “Seasoned direct loan borrower”: a direct loan borrower classified as commercial or standard. The Secretary must review seasoned borrowers each year and help them move to guaranteed loans from commercial or cooperative lenders when possible. The Secretary will prepare and share a prospectus with local approved lenders and the borrower. If a lender offers credit under that prospectus, the borrower normally can no longer get a direct insured loan. If guarantees or lender offers are not available, the Secretary will make an insured loan and may provide interest rate reductions as allowed by law. The Secretary must also create short, simple application forms for small loans and guarantees (farmer loans $125,000 or less; business-and-industry guarantees up to $400,000 for 2002–2003 and thereafter $400,000 or, if low risk, $600,000), speed processing for water and waste loans or grants of $300,000 or less, and design forms that can be filled out by hand or electronically, need little paperwork, cost little, and are fast to process. The Secretary should, where practical, make single-page simplified applications for certain named grant and relending programs.