ALM H.B. 993 75(R)BILL ANALYSIS


AGRICULTURE & LIVESTOCK
H.B. 993
By: Pete Patterson
2-18-97
Committee Report (Unamended)



BACKGROUND 

The Young Farmer Program was established in 1993 as a direct loan
endowment program for people 18 to 39 years of age, with four years of
practical agricultural experience, who desire to establish their first
farming or ranching operation.  It is funded by a $5 fee on farm license
tags. In 1995 the program was revised as a loan guarantee program.
Currently, about 5 million dollars are in the Young Farmer fund and six
loans have been made.  It is believed that the inactivity of the program
may be due to restrictions on the program that have recently been
addressed by the Texas Agricultural Finance Authority (governing board
within the Texas Department of Agriculture) and that are addressed in this
legislation. 
 
PURPOSE

This legislation would increase the maximum Young Farmer Loan Guarantee
amount from $50,000 to $100,000, delete the requirement that an
applicant's plan be a five-year plan, and expand the allowed uses for the
loan proceeds. 
      
RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency or
institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 253.002, Agriculture Code, by increasing the
maximum loan guarantee amount from $50,000 to $100,000.  Expands the
allowed use of the loan to include working capital for operating a farm or
ranch rather than specifically listed items. 

SECTION 2.  Amends Section 253.003, Agriculture Code, by striking
department and inserting board.  Deletes the requirement that the
applicant's cash flow, production or management plan be a five-year plan.
Specifies that the applicant must have his plan reviewed by a county
extension agent in the area where the farm or ranch is located. 

SECTION 3.  Effective date:  September 1, 1997.

SECTION 4.  Emergency clause.