Rural Loan Programs

Pursuant to a congressional request, GAO provided information on the Department of Agriculture's (USDA) rural loan programs, focusing on those programs in which USDA: (1) made loans in fiscal year (FY) 1994 and FY 1995; (2) had authority to make loans in FY 1996; and (3) requested authority to make loans in FY 1997. GAO noted that: (1) USDA operates 20 programs that provide loans for farming, rural housing, rural community development, rural utilities, and rural businesses; (2) 1996 legislation authorizes USDA to operate three new credit programs in these areas and expand an existing loan program; (3) as of September 1995, the outstanding loan principle in USDA rural loan programs was about $95.8 billion and loans in rural housing and utilities areas accounted for about 80 percent of the loan amount; (4) delinquent borrowers accounted for about 9 percent of the total outstanding balance and 38 percent of the outstanding principle in direct farm loan programs; (5) USDA has the authority to make or guarantee loans of almost $9.1 billion for FY 1996 and has requested $10.9 billion in lending authority for FY 1997; and (6) USDA FY 1996 subsidy costs total $725 million and USDA has requested a $545 million subsidy for FY 1997 loans.