Farm Loans

President Reagan today signed a bill providing $1 billion to the Agriculture Department, allowing it to resume making price-support loans to farmers after a nearly weeklong cutoff. The action sent emergency money to the Commodity Credit Corp., which went broke last week and forced federal officials to halt loans to producers for their newly harvested crops. The Agriculture Department immediately gave local offices the green light to resume loan-making.

The U.S. Department of Agriculture has issued disaster declarations for 16 California counties because of the two-week heat wave in July and August, making farmers and ranchers eligible for low-interest emergency loans. Farmers in 32 neighboring counties also could be eligible for assistance from the Farm Service Agency, Agriculture Secretary Mike Johanns said in a letter to Gov. Arnold Schwarzenegger that was released Friday.

Under strong pressure from Congress, three federal regulatory agencies significantly relaxed restrictions on farm loans Tuesday in an attempt to ease the severe strain on many agricultural banks and their borrowers. The action, taken amid the worst rash of rural bankruptcies since the Great Depression, was praised by groups representing farmers and bankers. "This has to be a favorable move," said Bob Mullins, a lobbyist for the National Farmers Union.

Re "Paving Over a Farming Paradise," editorial, Dec. 8: Being actively involved in the farming and marketing of California citrus fruits, it does not surprise me that 20,000 acres of California farmland are being sold to real estate developers annually. One only needs to see, and understand, that bottom-line farming profits, in many cases, are break-even at best. For The Times to propose that statute reform should be implemented to preserve California farmland and to slow urban sprawl is shortsighted at best.

The rapidly deteriorating Farm Credit System will require a multibillion-dollar bail-out by the federal government in 18 to 24 months unless the agricultural economy improves dramatically, the system's regulatory agency declared Thursday.

Just under half of the farmers who are delinquent on federal loans totaling $8 billion responded to notices giving them the chance to seek restructuring of the loans, officials said Tuesday. The figures were disclosed at a Senate hearing in which senators accused the Farmers Home Administration of demanding too much information from farmers and giving them too little time--45 days--to complete the work and ask for restructuring.

Only 61 American farmers have been helped so far by a Reagan Administration loan guarantee program to help banks restructure their most troubled farm loans, the Agriculture Department said Saturday. Joe O'Neill, a spokesman for the department's Farmers Home Administration, said about $8.4 million in the special guarantees has been issued since the fiscal year began last Oct. 1. "Banks are not coming into the program as quickly as we might have expected," O'Neill said.

Despite the threat of widespread farm bankruptcies. Agriculture Secretary John R. Block on Sunday defended proposed cuts in fiscal 1986 farm support programs and added that "we can come up with something" in the week ahead to ease the farm credit crisis.

A bill that would have provided hundreds of millions of dollars in emergency credit relief to hard-pressed farmers, as well as $175 million in non-food aid to African nations ravaged by drought and famine, was passed by the House on a vote of 255-166 and sent to President Reagan. The President quickly vetoed the bill (HR 1096) because of its farm provisions. He called it a "multibillion-dollar bail-out . . .

Bad Loans in Farm Program Approach $4 Billion: Nearly 1,000 borrowers owe an average $2.3 million each in bad loans issued under a federal program to help struggling farmers, a Senate panel was told, and the government is unsure how much of that it can collect, the head of the Farmers Home Administration said. Other bad loans in lesser amounts bring the bad debt total closer to $4 billion for an agency that has had to write off $14.8 billion since 1984.

In rented meeting halls across the heartland, farmers and ranchers facing foreclosure embrace Roy Schwasinger's message with the hope usually reserved for the hereafter. Banks and their loans, he says, have been illegal since the 1930s, when the United States went off the gold standard and into debt. Since then, everything done with currency--taxes, loans, foreclosures--has been unlawful, he contends. "How can banking regulations exist when you don't even have banks?"

Agricultural lenders are tightly linking water availability to operating loans for the first time this planting season, making California farmers pass stiff water tests to get money to plant their crops. With state water deliveries to agriculture cut out entirely and federal deliveries trimmed 75%--reductions that are still in place regardless of recent rains--agricultural lenders are cutting back on their loan portfolios as farmers are forced to idle acreage.

The Midwestern farm crisis, which ravaged the nation's agricultural base and prompted an outpouring of sympathy from urban America and billions of dollars in aid from the federal government, is over. And the family farmer, one of the most romanticized figures in the modern psyche--an American ideal who seemed threatened with extinction during the depths of the crisis in the mid-1980s--has not only survived the ordeal but is once again prospering.

Some farmers are still gouging the government by collecting crop subsidies in excess of limits set by Congress, the Agriculture Department's inspection agency said Tuesday. In one case, the department's Office of Inspector General said, an individual collected about $2.8 million in subsidies, 56 times the $50,000 limit set by law.

Re "Paving Over a Farming Paradise," editorial, Dec. 8: Being actively involved in the farming and marketing of California citrus fruits, it does not surprise me that 20,000 acres of California farmland are being sold to real estate developers annually. One only needs to see, and understand, that bottom-line farming profits, in many cases, are break-even at best. For The Times to propose that statute reform should be implemented to preserve California farmland and to slow urban sprawl is shortsighted at best.

The Agriculture Department on Friday will begin notifying 13,000 farmers that they must seek to restructure overdue loans or face foreclosure, department officials said Wednesday. The notices will be sent to farmers who since January have been delinquent repaying government loans, many of which were made in the early 1980s under a special program for farmers unable to pay their bills. The loans have since become a massive burden to farmers and the government, and about half are delinquent.

Just under half of the farmers who are delinquent on federal loans totaling $8 billion responded to notices giving them the chance to seek restructuring of the loans, officials said Tuesday. The figures were disclosed at a Senate hearing in which senators accused the Farmers Home Administration of demanding too much information from farmers and giving them too little time--45 days--to complete the work and ask for restructuring.