Agricultural Credit Improvement Act
of 1992
Bill to assist beginning farmer to acquire his or her own farm.
This act required the U.S. Department of Agriculture’s
(USDA) Farm Service Agency (FSA) to target a percentage of
its direct and guaranteed farm operating and farm ownership
loans to beginning farmers and ranchers. In 1992, the average
age of farmers had increased to 52 years of age. Twice as many
farmers were 60 or older as were under the age of 35. The
increased cost of farming since the 1970s and the farm crisis
of the 1980s had washed many younger farmers out of the
business.
To get the loans, the beginning farmer had to draw up a
detailed 10-year plan of action for his or her farm. Once the
USDA Farm Service Agency approved the plan, new farmers
became eligible for direct, subsidized, operational loans from
the FMHA for 10 years and federal loan guarantees for the
next 5 years. After 15 years, these farmers became ineligible
for the program. The federal government took up liability for
80 to 90 percent of these loans if they were defaulted on.
Another minor change in the law allowed banks, rather
than the Farmers Home Administration (FmHA), to decide
which farmers met eligibility requirements for this program.
Members of Congress believed that this would get money to
the farmer faster. The bill also called for special efforts to
make loans more available to those who are “socially disadvantaged,” including women.