Members of the Arkansas House delegation introduced H.R. 5542, the Farm Protection Act of 2014. The legislation was introduced to help protect ag-producers who may become creditors in a bankruptcy. Earlier this summer, a grain merchandiser in Arkansas - Turner Grain - ended their operations and has since entered in to bankruptcy litigation causing problems for producers.
“We believe this bill would ensure that ag-producers aren’t burdened with unreasonable expectations of meeting their loan requirements or the accrual of interest on their loans while they work through bankruptcy proceedings as creditors. We are hopeful that this bill will be considered later this fall as the extension granted by Secretary [Tom] Vilsack comes to an end but bankruptcy proceedings will likely be just beginning,” the four Arkansas House members, Reps. Rick Crawford (R., Ark.), Tim Griffin (R., Ark.), Steve Womack (R., Ark.) and Tom Cotton (R., Ark.)., said in a statement.
Earlier this summer, the House delegation wrote Vilsack requesting a 180-day grace period on loan repayment for ag-producers who have contracts with Turner Grain while the complicated issues around Turner Grain were handled. While the full grace period that was requested was not granted, Vilsack did agree to an extra 60-day grace period for the producers who were affected in addition to the 30-day period that had already been granted.
The bill would prohibit the USDA from trying to collect any loan from producers who have become involved in a bankruptcy as a creditor until at least 180-days after the final disposition of the bankruptcy case. The bill also would also allow for a similar extension of 180-days following the final disposition for loans made under the Consolidated Farm and Rural Development Act. Lastly, the bill will help protect farmers whose loan repayments have been pulled back into a bankruptcy case.