REFERENCES IN TEXT

AMENDMENTS

1992-Subsec. (a)(2). Pub. L. 102-554, § 13, designated existing provisions as subpar. (A), inserted "(other than under subchapter II of this chapter)" after "under this chapter", and added subpar. (B).

Subsec. (f). Pub. L. 102-554, § 14, added subsec. (f). Subsec. (g). Pub. L. 102-554, § 15, added subsec. (g). 1990-Subsec. (a)(4). Pub. L. 101-624, § 1811, added par. (4).

Subsec. (c). Pub. L. 101-624, § 2388(f), substituted "If" for "In".

§ 1983b. Appeals

[See main edition for text of (a) to (d)] (e) Hearing officers; hearings: recordation, transcript, and record

[See main edition for text of (1) to (3)]

(4) Except as provided in paragraph (3) and in the regulations of the Secretary governing the right of the Secretary to seek review of appeal decisions under this chapter, a county committee or employee of the Farmers Home Administration shall, on having a case returned pursuant to the decision of a hearing officer, State director, or the director of the national appeals division, implement the decision within a reasonable period of time.

[See main edition for text of (f) and (g)] (As amended Pub. L. 101-624, title XVIII, § 1812, Nov. 28, 1990, 104 Stat. 3821.)

REFERENCES IN TEXT

For definition of "this chapter", referred to in subsecs. (a) and (e)(4), see note set out under section 1921 of this title.

AMENDMENTS

1990--Subsec. (e)(4). Pub. L. 101-624 added par. (4).

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1985, 2000, 2001 of this title; title 25 section 493.

§ 1985

§ 1985. Security servicing; operation or lease of realty; disposition of surplus property; conveyance of complete interest of United States; easements; condemnations; farmland sales and leases; management contracts; installments, selection of purchasers, subdivisions, announcements, conservation practices, and adverse effects prohibition; normal security income; conservation easements on wetlands on inventoried property

(a) The Secretary is authorized and empowered to make advances, without regard to any loan or total indebtedness limitation, to preserve and protect the security for or the lien or priority of the lien securing any loan or other indebtedness owing to, insured by, or acquired by the Secretary under this chapter or under any other programs administered by the Farmers Home Administration or the Rural Development Administration; to bid for and purchase at any execution, foreclosure, or other sale or otherwise to acquire property upon which the United States has a lien by reason of a judgment or execution arising from, or which is pledged, mortgaged, conveyed, attached, or levied upon to secure the payment of, any such indebtedness whether or not such property is subject to other liens, to accept title to any property so purchased or acquired; and to sell, manage, or otherwise dispose of such property as hereinafter provided.

[See main edition for text of (b)]

(c)(1) Except as provided in subsection (e) of this section, the Secretary may determine whether real property administered under this chapter is suitable for disposition to persons eligible for assistance under the provisions of any law administered by the Farmers Home Administration or the Rural Development Administration. The County Committee shall classify or reclassify real property (including real property administered by the Secretary on January 6, 1988) that is farmland, as being suitable for farming operation for such disposition unless the property, including property subdivided in accordance with subsection (e)(5) of this section, cannot be used to meet any of the purposes of section 1923 of this title (including being used as a start-up or add-on parcel of farmland). Any property which the Secretary determines to be suitable for such purposes shall, whenever practicable, be sold by the Secretary as expeditiously as possible to such eligible persons in a manner consistent with such provisions. Real property which is not determined suitable for sale to such eligible persons or which has not been purchased by such persons within a period of 12 months from the date first published under paragraph (2)(D), shall be (A) sold by the Secretary after public notice at public sale and, if no acceptable bid is received then by negotiated sale, at the best price obtainable for cash or on secured credit without regard to the laws governing the disposition of excess or surplus property of the United States or (B) leased to persons eligible for assistance under the provisions of any law administered by the Farmers Home Administration or the Rural Development Administration

under an annual lease or a lease with an option to purchase, with a preference for sale. The terms of such sale shall require an initial downpayment and the remainder of the sales price payable in installments with interest on unpaid balance at the rate determined by the Secretary, but not in any event at rates and terms more favorable than those legally permissible for eligible borrowers. Any conveyances under this section shall include all of the interest of the United States, including mineral rights, other than easements acquired under section 1997 of this title. Notwithstanding the preceding sentence, the Secretary may for conservation purposes grant or sell an easement, restriction, development rights, or the equivalent thereof, to a unit of local or State government or a private nonprofit organization separately from the underlying fee or sum of all other rights possessed by the United States.

(2)(A) Notwithstanding any other provision of law, the Secretary shall sell suitable farmland administered under this chapter to persons in the following order:

(i) Qualified beginning farmers or ranchers (as defined pursuant to section 1991(a)(8) of this title), as of the time immediately after such contract for sale or lease is entered into, as determined by the county committee.

(ii) Operators, as of the time immediately after such contract for sale or lease is entered into, of not larger than family sized farms, as determined by the county committee.

(B) In selling such land, the county committee shall

(i) grant a priority to persons eligible for loans under subchapter I of this chapter, including individuals approved for, but who, as of January 6, 1988, have not yet received, such loans;

(ii) offer such land

(I) for sales pursuant to subsection (e)(1)(C) of this section, at a price not greater than that which reflects the appraised market value of such farmland; and

(II) for all other sales, at a price not greater than that which reflects the fair market value of such land as determined by bids after advertising or by negotiated sale; (iii) select from among qualified applicants the applicant who has the greatest need for farm income and best meets the criteria for eligibility to receive loans under subchapter I of this chapter, except that if the committee determines that two or more applicants meet the loan eligibility criteria, the committee shall select between the qualified applicants on a random basis; and

(iv) publish or cause to be published three consecutive weekly announcements at least twice annually of the availability of such farmland, in at least one newspaper that is widely circulated in the county in which the land is located until the property is sold.

[See main edition for text of (d)] (e)(1)(A)(i) During the 180-day period beginning on the date of acquisition, or during the applicable period under State law, the Secretary shall allow the borrower-owner (as defined

in subparagraph (F)) to purchase or lease such property, if such borrower-owner has acted in good faith with the Secretary, as defined in regulations issued by the Secretary, in connection with such loan.

[See main edition for text of (ii) and (iii)]

(iv) In the case of real property described in clause (i) that was acquired by the Secretary before January 6, 1988, that is (or has been at any time during the 12-month period preceding November 28, 1990) under lease to a person described in subparagraph (C), and that has not been conveyed (or contracted to be conveyed) by the Secretary prior to November 28, 1990, the Secretary shall, during the 30-day period following November 28, 1990, make the person an offer, to be held open for a period of 90 days, to purchase the property on the same terms and conditions that such offers are made in the case of property coming into inventory on or after November 28, 1990.

[See main edition for text of (B)]

(C) The Secretary shall give preference in the sale or lease, with option to purchase, of property that has been foreclosed, purchased, redeemed, or otherwise acquired by the Secretary to persons in the following order:

(i) The immediate previous borrower-owner of the acquired property, if such borrowerowner has acted in good faith with the Secretary, as defined in regulations issued by the Secretary, in connection with the loan of such borrower-owner for which such property served as security.

[See main edition for text of (ii) and (iii)]

(iv) Qualified beginning farmers or ranchers (as defined pursuant to section 1991(a)(8) of this title) as of the time immediately after such contract for sale or lease is entered into, of not larger than family-sized farm or ranching operations.

(v) Operators (as of the time immediately after such sale or lease is entered into) of not larger than family-size farms.

(D)(i) Except as provided in subparagraph (G), if—

[See main edition for text of (I) to (IID] the Secretary shall dispose of or administer the property only as provided for in this subparagraph.

[See main edition for text of (ii) to (ix)] (x) This subparagraph shall apply to all lands in the land inventory established under this chapter (as of November 28, 1990) that were (immediately prior to November 28, 1990) owned by an Indian borrower-owner described in clause (i) and that are situated within an Indian reservation (as defined in clause (ii)), regardless of the date of foreclosure or acquisition by the Secretary. The Secretary shall afford an opportunity to a tribal member, an Indian corporate entity, or the tribe to purchase or lease the real property as provided in

(G)(i) If—

(I) the real property described in subparagraph (A)(i) is located within an Indian reservation;

(II) the borrower-owner is an Indian tribe that has jurisdiction over the reservation in which the real property is located or the borrower-owner is a member of an Indian tribe;

(III) the borrower-owner has obtained a loan made, insured, or guaranteed under this chapter; and

(IV) the borrower-owner and the Secretary have exhausted all of the procedures provided for in this chapter to permit a borrowerowner to retain title to the real property, such that it is necessary for the borrowerowner to relinquish title,

the Secretary shall dispose of or administer the property only as provided in subparagraph (D), as modified by this subparagraph.

(ii) The Secretary shall provide the borrowerowner of real property that is described in ́ clause (i) with written notice of

(I) the right of the borrower-owner to voluntarily convey the real property to the Secretary; and

(II) the fact that real property so conveyed will be placed in the inventory of the Secretary.

(iii) The Secretary shall provide the borrower-owner of the real property with written notice of the rights and protections provided under this chapter to the borrower-owner, and the Indian tribe that has jurisdiction over the reservation in which the real property is located, from foreclosure or liquidation of the real property, including written notice of

(I) the provisions of subparagraphs (C)(i), (C)(ii), and (D), this subparagraph, and subsection (g)(6) of this section;

(II) if the borrower-owner does not voluntarily convey the real property to the Secretary, that

(aa) the Secretary may foreclose on the property;

(bb) in the event of foreclosure, the property will be offered for sale;

(cc) the Secretary must offer a bid for the property that is equal to the fair market value of the property or the outstanding

§ 1985

principal and interest of the loan, whichever is higher;

(dd) the property may be purchased by another party; and

(ee) if the property is purchased by another party, the property will not be placed in the inventory of the Secretary and the borrower-owner will forfeit the rights and protections provided under this chapter; and

(III) the opportunity of the borrower-owner to consult with the Indian tribe that has jurisdiction over the reservation in which the real property is located or counsel to determine if State or tribal law provides rights and protections that are more beneficial than those provided the borrower-owner under this chapter.

(iv)(I) Except as provided in subclause (II), the Secretary shall accept the voluntary conveyance of real property described in clause (i).

(II) If a hazardous substance (as defined in section 9601(14) of title 42) is located on the property and the Secretary takes remedial action to protect human health or the environment if the property is taken into inventory, the Secretary shall accept the voluntary conveyance of the property only if the Secretary determines that it is in the best interests of the Federal Government.

(v) If a borrower-owner does not voluntarily convey to the Secretary real property described in clause (i), at least 30 days before a foreclosure sale of the property, the Secretary shall provide written notice to the Indian tribe that has jurisdiction over the reservation in which the real property is located of—

(I) the sale;

may prescribe by regulation, in accordance with subsection (c)(2)(B)(iii) of this section.

[See main edition for text of (5) to (10); (f)] (g)(1) Subject to paragraphs (2) through (5), in the disposal of real property under this section, the Secretary shall establish perpetual wetland conservation easements to protect and restore wetlands or converted wetlands that exist on inventoried property, as determined by the Secretary in accordance with title XII of the Food Security Act of 1985 (16 U.S.C. 3801 et seq.).

(2) In establishing the wetland conservation easements on land that is considered to be cropland as of November 28, 1990, the Secretary shall avoid, to the extent practicable, an adverse impact on the productivity of the croplands, as provided in this subsection.

(3) In order to avoid the adverse impact, the Secretary shall

(A) not establish the wetland conservation easements with respect to wetlands that were converted prior to December 23, 1985, and that have been in cropland use, as determined by the Secretary, in excess of 10 percent of the existing cropland available for production of agricultural commodities on the particular parcel of inventoried property;

(B) not establish the wetland conservation easements with respect to wetlands that have been frequently planted to agricultural commodities and wetlands described in subparagraph (A), in excess of 20 percent of the existing cropland available for production of agricultural commodities on the particular parcel of inventoried property;

(C) ensure that the buffer area adjacent to the wetland is generally not more than 100 feet in average width; and

(D) ensure that access to other portions of the property for farming and other uses is provided.

(4) The wetland conservation easements shall be placed on wetlands that have a history of haying and grazing, as determined by the Secretary, except that in no case shall the quantity of the wetland subject to the easements exceed 50 percent of the existing forage lands on the parcel of inventoried property. All haying and grazing practices on the wetlands (including the timing and intensity of haying and grazing) shall conform to forage management standards designed to protect wetlands.

(5) If, despite the limitations contained in paragraph (3), wetland conservation easements established under paragraph (1) would prevent a particular parcel of inventoried property that is to be sold or leased to a borrower described in clause (i), (ii), or (iii) of subsection (e)(1)(C) of this section, or to a borrower who is a beginning farmer or rancher, from being a marketable agricultural production unit that is comparable to the parcel as acquired, the Secretary may

(A) establish wetland conservation easements on wetland that was converted prior to December 23, 1985, in a quantity that is less than 10 percent of the existing croplands available for production of agricultural commodities on the particular parcel; and

(B) if the reduction provided in subparagraph (A) is not applicable, or is not suffi cient to ensure that the particular parcel would be a marketable agricultural production unit, amend the wetland conservation easements established on the wetlands that have been frequently planted to agricultural commodities to permit the production of agricultural commodities (consistent with title XII of the Food Security Act of 1985 [16 U.S.C. 3801 et seq.]) on the wetlands, to the extent necessary to maintain the parcel as a marketable agricultural production unit.

(6) The Secretary shall provide prior written notification to a borrower considering preservation loan servicing that a wetlands conservation easement may be placed on land for which the borrower is negotiating a lease option.

(7) The appraised value of the farm shall reflect the value of the land due to the placement of wetland conservation easements.

(8) Notwithstanding the limitations described under paragraphs (3) and (4), the limitations may be voluntarily, knowingly waived by any person with respect to real property described in paragraph (3) or (4).

(As amended Pub. L. 101-624, title XVIII, §§ 1813(a)-(h)(1), 1816(e), title XXIII, §§ 2303(c), 2388(g), Nov. 28, 1990, 104 Stat. 3821-3823, 3827, 3981, 4053; Pub. L. 102-237, title V, 501(f), Dec. 13, 1991, 105 Stat. 1867; Pub. L. 102-552, title V, § 516(h)(1), Oct. 28, 1992, 106 Stat. 4138; Pub. L. 102-554, §§ 16, 17, Oct. 28, 1992, 106 Stat. 4154.)

REFERENCES IN TEXT

The Food Security Act of 1985, referred to in subsec. (g)(1), (5)(B), is Pub. L. 99-198, Dec. 23, 1985, 99 Stat. 1354, as amended. Title XII of the Act, popularly known as the "Sodbuster Law", is classified principally to chapter 58 (§ 3801 et seq.) of Title 16, Conservation. For complete classification of this Act to the Code, see Tables.

AMENDMENTS

1991-Subsec.