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1 1 (January 22, 2021)

handle is hein.crs/govebrh0001 and id is 1 raw text is: rskn~I ~esearch $ervi~e ~ th~ I 9 Updated January 22, 2021 Farm Credit Administration and Its Board Members Overview The Farm Credit Adminis tration (FCA) is an independent agency that is the federalregulator responsible for examining and ensuring the safety and soundness of all Farm Credit System(FCS) institutions and the Federal Agricultural Mortgage Corporation (Farmer Mac). FCA is directed by a three-member board of directors nominated by the President and confirmed by the Senate (12 U.S.C. §2242). Congressionaloversight is provided by the House and Senate Agriculture Committees, which have primary jurisdiction for the FCS statutes. The most recent congressionalhearings on the FCS were in the Senate on May 19, 2016, and in the House on March 29, 2017 (with FCA witnes ses). The Senate Agriculture Committee most recently held a board member nomination hearing in November2017. Farm Credit Administration The FCA sets the policies, regulations, charters, and examinations of the FCS and Farmer Mac. This includes compliance with statutes to serve eligible borrowers. Violations may result in supervisory and enforcement actions. FCA also protects therights of borrowers and reports to Congress on the financial condition of theFCS. FCA has about 300 full- and part-time employees. It is located in McIean, VA, and conducts examinations from field offices in Colorado, Texas, Minnesota, and California. The current structure of the FCA and oversightof the FCS was created by the FarmCredit Amendments Act of 1985 (P.L. 99-205). Its statutory authority is in Title 12, Section 2241, of the UnitedStates Code, with regulations in Title 12, Section 600, of the Code ofFederalRegulations. FCA's operating expenses are paid through assessments on FCS banks and associations. Even though FCA does not receive an appropriation fromCo ngress, the annual Agriculture appropriations act places a limit on FCA's administrative expenses ($80 million in FY2021). Farm Credit System The FCS is a privately owned, federally chartered, nationwide financial cooperative that lends to full- and part- time farmers, farming-related businesses, rural homeowners, farmer-owned cooperatives, and certain rural utilities. Borrowers must meet creditworthiness requirements. FCS is not a lender of last resort. Established in 1916 as a government-sponsored enterprise (GSE), FCS has a statutory mandate-and limitation-to serve agriculture. FCS is the only direct lender among the GSEs. It receives taxbenefits, but FCS operates without any direct federal appropriations. FCS associations are owned by their borrowers, who are required to purchase s tock as p art of their loan s. FCS banks and as sociations do not take deposits like commercial banks. Instead, FCS uses capital markets to sellbonds that become the joint and several liabilities of all FCS banks, meaning they collectively stand behind the obligations to repay thosebonds. FCS is composedoffourregionalbanks that provide funds and support services to 68s maller credit associations that in turn provide loans to eligible borroweis. As of September 30, 2020, FCS had $302 billion in total agriculture and related loans outstanding, up 9% fromthe same period ayearearlier. Accordingto theU.S. Department of Agriculture, the FCS held nearly 43% of the total $419 billion of U.S. farm debt at the end of 2019. Statutory authority for FCS is in the FarmCredit Act of 1971 (12 U.S.C. §2001 et seq.), as amended notably by the Agricultural Credit Act of 1987. For more background, see CRS Report RS21278, Farm Credit System. Board Members As a regulator, FCA is directedby a three-member board of directors nominated by the President and confirmed by the Senate (12U.S.C. §2242). Terms forboard members are six years in length, fixed when they begin and staggered so that one termbegins every two years regardless of whether a new member has been appointed and confirmed. Board members may not be reappointed after serving afull term or more than three years of an unexpired term. A board member may continue to servebeyond the end ofhis/her term until a replacement has been confirmed. This helps maintain an effective board if successors are delayed. Not more than two members of the board may be fromthe same politicalparty. The President designates one member as chairman-not subject to further Senate confirmation-who has historically s erved in that role until the end of their term. The chairman is also the chief executive officer of the FCA (12 U.S.C. §2244). Current Board Members The current FCA boardhas two members andone vacancy (Table 1). Glen Smith was confirmed in 2017 for a term that expires in May 2022; he was designated as chairman in July 2019. Jeffrey Hall was confirmed in March 2015 for a term that expired on October 13,2018; he may continue to serve until a successor is confirmed. The vacancy was created when former chairman Dallas Tonsager died in office in May 2019. Both Smith and Hall are Republicans. At least one Democratic nominee would be needed to fill one of the two https://crsrepc

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