Relief for America's Small Farmers Act

II 116TH CONGRESS 2D SESSION S. 3602 To provide loan forgiveness for certain borrowers of Department of Agriculture direct farm loans, and for other purposes. IN THE SENATE OF THE UNITED STATES MAY 5, 2020 Mrs. GILLIBRAND (for herself, Mr. MERKLEY, Mr. BOOKER, and Mr. WYDEN) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To provide loan forgiveness for certain borrowers of Depart- ment of Agriculture direct farm loans, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Relief for America’s 4 Small Farmers Act’’. 5 SEC. 2. DIRECT FARM LOAN FORGIVENESS. 6 (a) DEFINITIONS.—In this section: 7 (1) ELIGIBLE BORROWER.—The term ‘‘eligible 8 borrower’’ means a borrower of an eligible loan that 9 VerDate Sep 11 2014 01:54 May 06, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3602.IS S3602 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 3602 IS is actively engaged in farming (within the meaning 1 of section 1001A of the Food Security Act of 1985 2 (7 U.S.C. 1308–1)) with respect to a farming oper- 3 ation— 4 (A) for which the eligible loan was made; 5 and 6 (B) the average annual adjusted gross in- 7 come for the previous 5-year period of which is 8 not more than $300,000. 9 (2) ELIGIBLE LOAN.—The term ‘‘eligible loan’’ 10 means a loan made before March 19, 2020, that 11 is— 12 (A) a direct farm ownership loan under 13 subtitle A of the Consolidated Farm and Rural 14 Development Act (7 U.S.C. 1922 et seq.); 15 (B) a direct operating loan under subtitle 16 B of the Consolidated Farm and Rural Devel- 17 opment Act (7 U.S.C. 1941 et seq.); or 18 (C) an emergency loan under subtitle C of 19 the Consolidated Farm and Rural Development 20 Act (7 U.S.C. 1961 et seq.). 21 (3) SECRETARY.—The term ‘‘Secretary’’ means 22 the Secretary of Agriculture. 23 (b) LOAN FORGIVENESS.— 24 VerDate Sep 11 2014 01:54 May 06, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3602.IS S3602 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 3602 IS (1) IN GENERAL.—Not later than 1 year after 1 the date on which the Secretary receives an applica- 2 tion under paragraph (2), subject to paragraphs (3) 3 and (4), the Secretary shall cancel the obligation to 4 repay the balance of principal and interest due as of 5 the date of enactment of this Act on an eligible loan 6 for the eligible borrower. 7 (2) APPLICATIONS.—To be eligible for cancella- 8 tion under paragraph (1), not later than 1 year after 9 the date of enactment of this Act, an eligible bor- 10 rower shall submit to the Secretary an application, 11 which shall cover all eligible loans for which the eli- 12 gible borrower is seeking cancellation. 13 (3) LIMITATIONS.—The total amount cancelled 14 under paragraph (1) with respect to a farming oper- 15 ation shall be not more than $250,000. 16 (4) CONDITION.—The cancellation of an obliga- 17 tion under paragraph (1) shall be subject to the con- 18 dition that the applicable eligible borrower shall con- 19 tinue to be actively engaged in farming (within the 20 meaning of section 1001A of the Food Security Act 21 of 1985 (7 U.S.C. 1308–1)) for the 2-year period 22 beginning on the date on which the Secretary can- 23 cels the obligation under that paragraph. 24 VerDate Sep 11 2014 01:54 May 06, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3602.IS S3602 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 3602 IS (c) EFFECT.—An eligible borrower that receives can- 1 cellation of an obligation with respect to an eligible loan 2 under subsection (b)(1) shall not be determined to be ineli- 3 gible for any loan under subtitle A, B, or C of the Consoli- 4 dated Farm and Rural Development Act (7 U.S.C. 1922 5 et seq.) because of that cancellation. 6 (d) TAXABILITY.—For purposes of the Internal Rev- 7 enue Code of 1986, any amount which (but for this sub- 8 section) would be includible in gross income of the eligible 9 borrower by reason of forgiveness described in subsection 10 (b) shall be excluded from gross income. 11 Æ VerDate Sep 11 2014 01:54 May 06, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\S3602.IS S3602 pamtmann on DSKBC07HB2PROD with BILLS