Statement of Administration Policy: S. 2249 - Family Farm Bankruptcies

(Senate)
(Grassley (R) Iowa and 3 others)

The Administration strongly opposes enactment of S. 2249. By permitting the confirmation of a bankruptcy plan over the objections of certain creditors, S. 2249 would have a substantial negative effect on the United States in its role as creditor. In particular, enactment of this bill would have an adverse impact on the farm loan program administered by the Farmers Home Administration of the Department of Agriculture. In addition, relaxation of the bankruptcy laws for family farms may harm other farm creditors and local farm economies by: impairing the financial condition of lenders; reducing the availability of farm credit; and eliminating any incentive for farmers with temporary cash flow problems to work out long-term solutions with their creditors.