7 USC 1983b - Beginning farmer and rancher individual development accounts pilot program

U.S Code last checked for updates: May 10, 2024

§ 1983b.

Beginning farmer and rancher individual development accounts pilot program

(a)

Definitions

In this section:

(1)

Demonstration program

(2)

Eligible participant

The term “eligible participant” means a qualified beginning farmer or rancher that—

(A)

lacks significant financial resources or assets; and

(B)

has an income that is less than—

(i)

80 percent of the median income of the State in which the farmer or rancher resides; or

(ii)

200 percent of the most recent annual Federal Poverty Income Guidelines published by the Department of Health and Human Services for the State.

(3)

Individual development account

(4)

Qualified entity

(A)

In general

The term “qualified entity” means—

(i)

1 or more organizations—

(I)

described in section 501(c)(3) of title 26; and

(II)

exempt from taxation under section 501(a) of such title; or

(ii)

a State, local, or tribal government submitting an application jointly with an organization described in clause (i).

(B)

No prohibition on collaboration

(b)

Pilot program

(1)

In general

The Secretary shall establish a pilot program to be known as the “New Farmer Individual Development Accounts Pilot Program” under which the Secretary shall work through qualified entities to establish demonstration programs—

(A)

of at least 5 years in duration; and

(B)

in at least 15 States.

(2)

Coordination

(3)

Reserve funds

(A)

In general

(B)

Federal funds

(C)

Use of funds

Of the funds deposited under subparagraph (B) in the reserve fund established for a demonstration program, the qualified entity carrying out the demonstration program—

(i)

may use up to 10 percent for administrative expenses; and

(ii)

shall use the remainder in making matching awards described in paragraph (4)(B)(ii)(I).

(D)

Interest

(E)

Guidance

(F)

Reversion

On the date on which all funds remaining in any individual development account established by a qualified entity have reverted under paragraph (5)(B)(ii) to the reserve fund established by the qualified entity, there shall revert to the Treasury of the United States a percentage of the amount (if any) in the reserve fund equal to—

(i)

the amount of Federal funds deposited in the reserve fund under subparagraph (B) that were not used for administrative expenses; divided by

(ii)

the total amount of funds deposited in the reserve fund.

(4)

Individual development accounts

(A)

In general

(B)

Contract requirements

To be eligible to receive funds under this section from a qualified entity, an eligible participant shall enter into a contract with only 1 qualified entity under which—

(i)

the eligible participant agrees—

(I)

to deposit a certain amount of funds of the eligible participant in a personal savings account, as prescribed by the contractual agreement between the eligible participant and the qualified entity;

(II)

to use the funds described in subclause (I) only for 1 or more eligible expenditures described in paragraph (5)(A); and

(III)

to complete financial training; and

(ii)

the qualified entity agrees—

(I)

to deposit, not later than 1 month after an amount is deposited pursuant to clause (i)(I), at least a 100-percent, and up to a 200-percent, match of that amount into the individual development account established for the eligible participant; and

(II)

with uses of funds proposed by the eligible participant.

(C)

Limitation

(i)

In general

(ii)

Treatment of amount

(5)

Eligible expenditures

(A)

In general

An eligible expenditure described in this subparagraph is an expenditure—

(i)

to purchase farmland or make a down payment on an accepted purchase offer for farmland;

(ii)

to make mortgage payments on farmland purchased pursuant to clause (i), for up to 180 days after the date of the purchase;

(iii)

to purchase breeding stock, fruit or nut trees, or trees to harvest for timber; and

(iv)

for other similar expenditures, as determined by the Secretary.

(B)

Timing

(i)

In general

(ii)

Unexpended funds

(c)

Applications

(1)

In general

(2)

Criteria

In considering whether to approve an application to carry out a demonstration program under this section, the Secretary shall assess—

(A)

the degree to which the demonstration program described in the application is likely to aid eligible participants in successfully pursuing new farming opportunities;

(B)

the experience and ability of the qualified entity to responsibly administer the demonstration program;

(C)

the experience and ability of the qualified entity in recruiting, educating, and assisting eligible participants to increase economic independence and pursue or advance farming opportunities;

(D)

the aggregate amount of direct funds from non-Federal public sector and private sources that are formally committed to the demonstration program as matching contributions;

(E)

the adequacy of the plan of the qualified entity to provide information relevant to an evaluation of the demonstration program; and

(F)

such other factors as the Secretary considers to be appropriate.

(3)

Preferences

In considering an application to conduct a demonstration program under this section, the Secretary shall give preference to an application from a qualified entity that demonstrates—

(A)

a track record of serving clients targeted by the program, including, as appropriate, socially disadvantaged farmers or ranchers (as defined in section 2003(e)(2) of this title); and

(B)

expertise in dealing with financial management aspects of farming.

(4)

Approval

(5)

Term of authority

(d)

Grant authority

(1)

In general

(2)

Maximum amount of grants

(3)

Timing of grant payments

The Secretary shall pay the amounts awarded under a grant made under this section—

(A)

on the awarding of the grant; or

(B)

pursuant to such payment plan as the qualified entity may specify.

(e)

Reports

(1)

Annual progress reports

(A)

In general

Not later than 60 days after the end of the calendar year in which the Secretary authorizes a qualified entity to carry out a demonstration program under this section, and annually thereafter until the conclusion of the demonstration program, the qualified entity shall prepare an annual report that includes, for the period covered by the report—

(i)

an evaluation of the progress of the demonstration program;

(ii)

information about the demonstration program, including the eligible participants and the individual development accounts that have been established; and

(iii)

such other information as the Secretary may require.

(B)

Submission of reports

(2)

Reports by the Secretary

(f)

Annual review

The Secretary may conduct an annual review of the financial records of a qualified entity—

(1)

to assess the financial soundness of the qualified entity; and

(2)

to determine the use of grant funds made available to the qualified entity under this section.

(g)

Regulations

In carrying out this section, the Secretary may promulgate regulations to ensure that the program includes provisions for—

(1)

the termination of demonstration programs;

(2)

control of the reserve funds in the case of such a termination;

(3)

transfer of demonstration programs to other qualified entities; and

(4)

remissions from a reserve fund to the Secretary in a case in which a demonstration program is terminated without transfer to a new qualified entity.

(h)

Authorization of appropriations

(Pub. L. 87–128, title III, § 333B, as added Pub. L. 110–234, title V, § 5301, May 22, 2008, 122 Stat. 1147, and Pub. L. 110–246, § 4(a), title V, § 5301, June 18, 2008, 122 Stat. 1664, 1908; amended Pub. L. 113–79, title V, § 5301, Feb. 7, 2014, 128 Stat. 839; Pub. L. 115–334, title V, § 5301, Dec. 20, 2018, 132 Stat. 4671.)

cite as: 7 USC 1983b