Magazine article American Banker

Lobbyists Wary of Farm Credit Push in Voting on Bill

Magazine article American Banker

Lobbyists Wary of Farm Credit Push in Voting on Bill

Article excerpt

WASHINGTON -- Banking Lobbyists Are Anxiously Tracking A House Agriculture Subcommittee Vote Today On A Portion Of A Farm Bill That May Significantly Expand The Farm Credit System's Lending Authority.

The Farm Credit System is seeking to offer mortgage loans in towns as large as 50,000 people - up from 2,500 - and to increase its commercial lending beyond just farms and ranches to businesses that support agriculture, such as processors and suppliers.

Banking lobbyists said versions of the bill's credit section circulated last week included some Farm Credit System proposals from its Horizons Project. The language was later stripped out, but the situation is fluid, and lobbyists are wary that the expansive lending provisions could be added back by the subcommittee - or when the bill is voted on by the full committee.

"Conversations with Hill staff over the last few weeks has led most members of the banking trades to speculate and raise our concerns that there is some support from members of the subcommittee as well as the full committee for small applications of the Horizons proposal," said Nicole Freeman, a lobbyist for America's Community Bankers.

The House Agriculture conservation, credit, energy, and research subcommittee is expected to begin debate on the bill today, but a final vote may not come until Wednesday, lobbyists said.

Bankers oppose any Farm Credit System expansion, arguing that it would bolster a tax-advantaged, cooperatively owned, and government-sponsored enterprise's ability to compete against banks.

But Kenneth Auer, the president of the Farm Credit Council, said banks have mischaracterized the proposals.

"Commercial banks basically don't like the idea that they have a farmer-owned competitor out there who has access to GSE funding," he said.

"The bankers ... have lied throughout this entire process, and members on the Hill ought to be really unhappy about the misinformation that they have been spreading about this. …

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