§8789 — Title 7 Agriculture | U.S. Code

Summary

The Secretary must set up a loan program quickly after the law is passed to help farmers build or improve places to store and handle crops. The loans are for people who grow grains, oilseeds, pulse crops, hay, renewable biomass, and other storable crops the Secretary allows (but not sugar). To get a loan, a farmer must have good credit, need more storage space, and be able to pay back the loan. Loans can last up to 12 years and the most anyone can borrow is $500,000. The loan money can be paid in one partial draw and one final draw, with proof the Secretary accepts. Borrowers must give loan security, usually a lien on the land where the storage is or other security the Secretary approves. The Secretary can let a borrower skip a severance agreement with an earlier lien holder if the borrower raises the down payment or gives other acceptable security. With approval, a smaller part of the land can be used as the loan’s security if it is big enough and has no higher liens.

Title 7, §8789

Agriculture — Source: USLM XML via OLRC

(a)As soon as practicable after the date of enactment of this Act, the Secretary shall establish a storage facility loan program to provide funds for producers of grains, oilseeds, pulse crops, hay, renewable biomass, and other storable commodities (other than sugar), as determined by the Secretary, to construct or upgrade storage and handling facilities for the commodities.

(b)A storage facility loan under this section shall be made available to any producer described in subsection (a) that, as determined by the Secretary—

(1)has a satisfactory credit history;

(2)has a need for increased storage capacity; and

(3)demonstrates an ability to repay the loan.

(c)A storage facility loan under this section shall have a maximum term of 12 years.

(d)The maximum principal amount of a storage facility loan under this section shall be $500,000.

(e)The Secretary shall provide for 1 partial disbursement of loan principal and 1 final disbursement of loan principal, as determined to be appropriate and subject to acceptable documentation, to facilitate the purchase and construction of eligible facilities.

(f)Approval of a storage facility loan under this section shall—

(1)require the borrower to provide loan security to the Secretary, in the form of—

(A)a lien on the real estate parcel on which the storage facility is located; or

(B)such other security as is acceptable to the Secretary;

(2)under such rules and regulations as the Secretary may prescribe, not require a severance agreement from the holder of any prior lien on the real estate parcel on which the storage facility is located, if the borrower—

(A)agrees to increase the down payment on the storage facility by an amount determined appropriate by the Secretary; or

(B)provides other security acceptable to the Secretary; and

(3)allow a borrower, upon the approval of the Secretary, to define a subparcel of real estate as security for the storage facility loan if the subparcel is—

(A)of adequate size and value to adequately secure the loan; and

(B)not subject to any other liens or mortgages that are superior to the lien interest of the Commodity Credit Corporation.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The date of enactment of this Act, referred to in subsec. (a), is the date of enactment of Pub. L. 110–246, which was approved June 18, 2008. Codification Pub. L. 110–234 and Pub. L. 110–246 enacted identical sections. Pub. L. 110–234 was repealed by section 4(a) of Pub. L. 110–246.

Statutory Notes and Related Subsidiaries

Effective Date

Enactment of this section and repeal of Pub. L. 110–234 by Pub. L. 110–246 effective May 22, 2008, the date of enactment of Pub. L. 110–234, see section 4 of Pub. L. 110–246, set out as a note under section 8701 of this title.

§8789 Storage facility loans