Originally created 07/11/98

Lawmaker: Farmers being treated unfairly



WASHINGTON -- Georgia farmers seeking federal disaster loans have been turned down more frequently than farmers in most other states because of "rigid, harsh and unfair" treatment from federal farm officials, a Georgia congressman charged Friday.

Rep. Sanford Bishop, an Albany Democrat, said Agriculture Department records show that just under 30 percent of the disaster loan applications from Georgia farmers this year have been approved.

Only three states -- Oregon, Washington and Nebraska -- had lower approval rates than Georgia, and those three combined had just 33 applications, he said. Georgia farmers filed 177 loan applications and got just 53 approved.

"Our farmers are getting a raw deal and it must be corrected now," said Mr. Bishop. "We have suspected for some time the screening process was tougher in Georgia than in other states. Now we have data that supports this suspicion."

Dallas Smith, deputy undersecretary for farm and foreign agriculture, said it's difficult to make valid state to state comparisons because of differing disaster conditions and funding availability.

Some of the fiscal 1998 applications reflected in USDA records, for example, actually were filed in previous years but not funded because the department ran out of money, Smith said. Those applications were first in line for this year's money.

Because of Mr. Bishop's complaint, Mr. Smith said the department will review all the Georgia loan applications to ensure that the state's farmers are being treated fairly.

Hanson Carter, administration of the federal Farm Service Agency in Georgia, said there had been 180 applications filed by Georgia farmers as of Friday, and 45 of those are still pending, awaiting additional information.

Of the remaining 135, Mr. Carter said 58 have been approved, 59 have been rejected and 18 have been withdrawn.

Mr. Carter said Georgia may have had more rejections than other states because federal officials, with the help of Georgia's congressional delegation, held seminars urging farmers to apply for disaster loans, even if they weren't sure they qualified.

"We follow the same rules and regulations that other states do," said Mr. Carter. "I don't see how anybody can say that we do it any differently than anybody else."

Mr. Bishop said the USDA records he reviewed showed that Alabama farmers, who have experienced weather problems similar to those in Georgia, have had almost 68 percent of their 56 disaster loan applications approved this year.

The only two states with more disaster loan applications that Georgia were Minnesota, which has had 66 percent of its 278 approved, and North Dakota, which has had 68 percent of its 406 approved.

USDA records do not show how many disaster loan applications were filed in some states, making it impossible to calculate a national average approval rate. But Mr. Bishop said the available data suggests it would be substantially higher than Georgia's 29.9 percent.

To qualify for the low interest disaster loans, farmers first have to be turned down by commercial lenders. They also have to post 150 percent collateral and cannot have a federal farm loan write-off on their record in the past.

Congress included language in an emergency spending bill earlier this year directing the Agriculture Department to make it easier for Georgia farmers to obtain disaster loans, by easing collateral requirements and discounting previous federal loan write-offs.

Mr. Bishop, who met with Agriculture Department officials in April to urge more flexibility in processing disaster loans, said he's seen no evidence that the department has acted.

"All we are asking for is fairness," he said. "The state comparisons show that more can be done to administratively to help Georgia farmers."