Pub. 9 2014-2015 Issue 5

www.nebankers.org 22 Extraordinary Service for Extraordinary Members. T HE ABA HAS JUST LAUNCHED A NEW campaign to increase public and congressional awareness of the multitude of risks that the Farm Credit System (FCS) poses. The campaign includes a new website, www.ReformFarmCredit.org , that will express in stark, easy-to-understand terms the risks posed by the FCS’ im- plicit Treasury backing, the waste gen- erated by its unfair tax advantages, and themissed opportunities resulting from Bert Ely’s FARM CREDIT WATCH ® Shedding Light on the Farm Credit System, America’s Least Known GSE © 2015 Bert Ely ABA Launches Campaign to Increase Political Pressure on FCS the FCS’ neglect of its core mission. The campaign includes reaching out to policy organizations in Washington to encourage them to focus on FCS issues as well as initiatives at the local level to encourage discussions of the FCS in local media outlets. No Word on FCS’ $10 Billion Treasury LOC On May 8, I filed a Freedom of Information Act (FOIA) request with the Treasury Department to obtain all documents related to the creation of the $10 billion line of credit (LOC) the Farm Credit System Insurance Corp. (FCSIC) obtained from the Treasury Department’s Federal Financing Bank. This line of credit, created on Sept. 24, 2013, was set to expire on Sept. 30, 2014; it has since been renewed for another year. Although I have had numerous exchanges with Treasury since filing my FOIA request, I have yet to receive a single piece of paper. I recently was advised that a Treasury official “is reviewing the documents” I have requested before they are sent to a group of officials within Treasury for further review. I will persevere in my pursuit of these documents and report to FarmCreditWatch (FCW) readers on the background behind this line of cred- it, which came into being without any congressional authorization, as soon as I receive a response from Treasury. Conflict Within FCA Over Mergers & “Alliances”? Conflict, or confusion,may be emerg- ing within the FarmCredit Administra- tion (FCA) over themanner inwhich the consolidation process proceeds within the FCS. Traditionally, consolidation has occurred when two or more FCS associations merge and, less frequently, when two Farm Credit banks merge. Due tomergers, over the last decade the number of FCS associations has shrunk from97 to 77 while the number of banks has declined from five to four. In sharp contrast, there were 845 FCS entities 30 years ago. As the October FCW re- ported, a new formof consolidation has surfaced within the FCS: a “strategic al- liance” between FCS of America (FCSA) and Frontier Farm Credit. Essentially, FCSA, the largest FCS association, assumed management control of the much smaller Frontier without taking ownership of it through an outright merger. As a result, Frontier is merely a shell organization today, with a board of directors but with no employees or any meaningful substance—all of that lies within the control of FCSA, which serves all of Nebraska, Wyoming, South