Community Bankers Association of Illinois

CBAI Opposes FCA Expansion

On July 25, 2008, the Community Bankers Association of Illinois submitted a comment letter in opposition to the Farm Credit Administration's proposal to expand the powers of farm credit institutions. The FCA's proposed regulation would allow farm credit institutions to make "rural community investments" that are not currently authorized by law. The FCA would define "rural communities" to include areas having less than 50,000 residents according to information available from the most recent census conducted by the United States Census Bureau.

CBAI objected to this proposed expansion of powers for farm credit institutions for numerous reasons, including the facts that: the proposal exceeds the scope of the FCA's authority under the federal Farm Credit Act of 1971; the FCA's definition of "rural communities" is misleading; the proposal is inconsistent with a recent Congressional decision to reject expanded powers for farm credit institutions in this year's Farm Bill; and the proposal could lead to more lending and investment authority for farm credit institutions that already compete with community banks in rural America and that benefit from government assistance and tax advantages not available to traditional community banks, savings banks and savings and loan associations.

"This is the most recent example of the Farm Credit Administration's efforts to expand the powers and the mission of farm credit institutions," said Kent Siltman, CBAI Chairman and President of Citizens First State Bank of Walnut. "The FCA has no regard for the boundaries within which farm credit institutions are supposed to operate, and the Community Bankers Association of Illinois is firm in our opposition to the additional, unauthorized powers that the FCA is now proposing."

CBAI members are encouraged to send their own comment letters to the Farm Credit Administration in opposition to the proposed "rural community investment" regulation. The deadline for comments to be received by the FCA is Friday, August 15th.

To read the comment letter sent by CBAI, click here.

To see a sample comment letter prepared for CBAI members, click here.

CBAI members are free to use and to modify any parts of the CBAI comment letter or of the sample comment letter, or you may choose to draft your own comment letter. CBAI appreciates your participation in this effort to defeat the Farm Credit Administration's proposal to expand the powers of farm credit institutions in rural Illinois and rural America.

If you have any questions or need additional information, please feel free to contact CBAI General Counsel Jerry Cavanaugh at 1/800-736-2224 or via email at jerryc@cbai.com.

  800.736.2224 (IL) | 217.529.2265  
  DISCLAIMER: The association is not responsible for and has no control over the subject matter, content, information, or graphics when viewing links attached to this association's site.