74 STAT. 198. are not required to be appointed for all of the terms beginning the next succeeding January 1, in order to reduce the number of elected directors to six, the Farm Credit Administration shall designate the terms to be filled by appointment or election. · "(d) Any vacancy in the Board of Directors shall be filled for the unexpired term in the same manner, by appointment or election, in which the vacant office was filled. Each director elected or appointed for a district shall have been a resident of such district for at least two years prior to election or appointment and shall have had experience with the business and financial operation of agricultural cooperatives. No person shall be eligible for election or appointment as a director for a district if such person has, within two years next = preceding the commencement of the term, been a salaried officer or employee of the Farm Credit Administration or of any corporation operating under its supervision. No person shall be eligible to serve as an elected or appointed director for a district for more than two full terms of three years, plus any elected or appointed term of less than three years which expires immediately preceding his election or appointment to a full term. Any person who is a member of the Federal Farm Credit Board when appointed or elected as director shall resign as a member of the Federal Farm Credit Board before assuming his duties as director of the Central Bank. No person who becomes such director shall be eligible to continue to serve if he becomes a member of the Federal Farm Credit Board or an officer or employee of the Farm Credit Administration or an officer or employee of any corporation operating under the supervision of the Farm Credit Administration. Any appointed director may be removed at pleasure at any time by the Farm Credit Administration." Approved June 11, 1960. E 87th Congress, H. R. 1822 March 29, 1961 AN ACT To adjust the amount of funds available for farm operating loans made pursuant to section 21(b) of the Bankhead-Jones Farm Tenant Act, as amended. 75 STAT. 17. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the second Bankheadsentence of section 21(b) of the Bankhead-Jones Farm Tenant Jones Farm Act, as amended (7 U.S.C. 1007(b)), is amended by striking the Tenant Act, words "10 per centum" and by inserting in lieu thereof the words amendment. 25 per centum". Approved March 29, 1961. (327) 70 Stat. 802. (EXTRACT FROM) Public Law 87-128 87th Congress, S. 1643 August 8, 1961 An Act To improve and protect farm prices and farm income, to increase farmer participation in the development of farm programs, to adjust supplies of agricultural commodities in line with the requirements therefor, to improve distribution and expand exports of agricultural commodities, to liberalize and extend farm credit services, to protect the interest of consumers, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be Agricultural cited as the "Agricultural Act of 1961". Aot of 1961. TITLE III-AGRICULTURAL CREDIT SEC. 301. (a) This title may be cited as the "Consolidated Farmers Citation Home Administration Act of 1961". (b) The Congress hereby finds that the statutory authority of the Secretary of Agriculture, hereinafter referred to in this title as the "Secretary," for making and insuring loans to farmers and ranchers should be revised and consolidated to provide for more effective credit services to farmers. SUBTITLE A-REAL ESTATE LOANS SEC. 302. The Secretary is authorized to make and insure loans under this subtitle to farmers and ranchers in the United States and in Puerto Rico and the Virgin Islands who (1) are citizens of the United States, (2) have a farm background and either training or farming experience which the Secretary determines is sufficient to assure reasonable prospects of success in the proposed farming operations, (3) are or will become owner-operators of not larger than family farms, and (4) are unable to obtain sufficient credit elsewhere to finance their actual needs at reasonable rates and terms, taking into consideration prevailing private and cooperative rates and terms in the community in or near which the applicant resides for loans for similar purposes and periods of time. SEC. 303. Loans may be made or insured under this subtitle for acquiring, enlarging, or improving farms, including farm buildings, land and water development, use and conservation, refinancing existing indebtedness, and for loan closing costs. In making or insuring (328) of title. 75 STAT. 308. Land and water development. Loan limitation. 50 Stat. 869; 68 Stat. 735; 72 Stat. 841. 16 USC 590r590x-4. Repayment period. Security. loans for farm purchase, the Secretary shall give preference to persons who are married or have dependent families and, wherever practicable, to persons who are able to make initial downpayments, or who are owners of livestock and farm implements necessary successfully to carry on farming operations. SEC. 304. Loans may also be made or insured under this subtitle to any farmowners or tenants without regard to the requirements of section 302 (1), (2), and (3)' for the purposes only of land and water development, use and conservation. SEC. 305. The Secretary shall make or insure no loan under sections 302, 303, and 304 which would cause (a) the unpaid indebtedness against the farm or other security at the time the loan is made to exceed $60,000 or the normal value of the farm or other security, or (b) the loan to exceed the amount certified by the county committee. In determining the normal value of the farm, the Secretary shall consider appraisals made by competent appraisers under rules established by the Secretary. Such appraisals shall take into consideration both the normal agricultural value and the normal market value of the farm. SEC. 306. (a) The Secretary also is authorized to make or insure loans to associations, including corporations not operated for profit and public and quasi-public agencies, to provide for the application or establishment of soil conservation practices, the conservation, development, use, and control of water and the installation or improvement of drainage facilities, all primarily for serving farmers, ranchers, farm tenants, farm laborers, and rural residents, and to furnish financial assistance or other aid in planning projects for such purposes. No such loans shall be made or insured which would cause an association's unpaid principal indebtedness under this section and the Act of August 28, 1937, as amended, to exceed $500,000 in the case of direct loans and $1,000,000 in the case of insured loans at any one time. (b) The service provided or made available through any such association shall not be curtailed or limited by inclusion of the area served by such association within the boundaries of any municipal corporation or other public body, or by the granting of any private franchise for similar service within such area during the term of such loan; nor shall the happening of any such event be the basis of requiring such association to secure any franchise, license, or permit as a condition to continuing to serve the area served by the association at the time of the occurrence of such event. SEC. 307. (a) The period for repayment of loans under this subtitle shall not exceed forty years. The Secretary shall from time to time establish the interest rate or rates at which loans for various purposes will be made or insured under this subtitle but not in excess of 5 per centum per annum. The borrower shall pay such fees and other charges as the Secretary may require. (b) The Secretary shall take as security for the obligations entered into in connection with loans, mortgages on farms with respect to which such loans are made or such other security as the Secretary may require, and for obligations in connection with loans to associations under section 306, shall take liens on the facility or such other security as he may determine to be necessary. Such security instruments shall constitute liens running to the United States notwithstanding the fact that the notes may be held by lenders other than the United States. SEC. 308. Loans under this subtitle may be insured by the Secretary, aggregating not more than $150,000,000 in any one year, whenever 54-539 O-71-22 75 STAT. 309. funds are advanced or a loan is purchased by a lender other than the United States. In connection with insurance of loans, the Secretary (a) is authorized to make agreements with respect to the servicing of loans insured hereunder and to purchase such loans on such terms and conditions as he may prescribe, except that no agreement shall provide for purchase by the Secretary at a date sooner than three years from the date of the note; and (b) shall retain out of payments by the borrower a charge at a rate determined by the Secretary from time to time equivalent to not less than one-half of 1 per centum per annum on the principal unpaid balance of the loan." Any contract of insurance executed by the Secretary under this subtitle shall be an obligation supported by the full faith and credit of the United States and incontestable except for fraud or misrepresentation of which the holder has actual knowledge. SEC. 309. (a) The fund established pursuant to section 11 (a) of the Agricultural Bankhead-Jones Farm Tenant Act, as amended, shall hereafter be Credit Insurcalled the Agricultural Credit Insurance Fund and is hereinafter in ance Fund. this subtitle referred to as the "fund". The fund shall remain avail- 60 Stat. 1072. able as a revolving fund for the discharge of the obligations of the 7 USC 1005a. Secretary under agreements insuring loans under this subtitle and loans and mortgages insured under prior authority. (b) Moneys in the fund not needed for current operations shall be deposited in the Treasury of the United States to the credit of the fund or invested in direct obligations of the United States or obligations guaranteed by the United States. The Secretary may purchase with money in the fund any notes issued by the Secretary to the Secretary of the Treasury for the purpose of obtaining money for the fund. (c) The Secretary is authorized to make and issue notes to the Secretary of the Treasury for the purpose of obtaining funds necessary for discharging obligations under this section and for authorized expenditures out of the fund. Such notes shall be in such form and denominations and have such maturities and be subject to such terms and conditions as may be prescribed by the Secretary with the approval of the Secretary of the Treasury. Such notes shall bear interest at a rate fixed by the Secretary of the Treasury, taking into consideration the current average market yield of outstanding marketable obligations of the United States having maturities comparable to the notes issued by the Secretary under this subtitle. The Secretary of the Treasury is authorized and directed to purchase any notes of the Secretary issued hereunder, and, for that purpose, the Secretary of the Treasury is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under the Second Liberty Bond Act, as amended, and the purposes for which such securities may be 40 Stat. 288. issued under such Act, as amended, are extended to include the pur-31 USC 774. chase of notes issued by the Secretary. All redemptions, purchases, and sales by the Secretary of the Treasury of such notes shall be treated as public debt transactions of the United States. (d) Notes and security acquired by the Secretary in connection with loans insured under this subtitle and under prior authority shall become a part of the fund. Notes may be held in the fund and collected in accordance with their terms or may be sold by the Secretary with or without agreements for insurance thereof at the balance due thereon, or on such other basis as the Secretary may determine from time to time. All net proceeds from such collections, including sales of notes or property, shall be deposited in and become a part of the fund. (e) The Secretary shall deposit in the fund such portion of the charge collected in connection with the insurance of loans at least |