FORBEARANCE POLICY FOR PCAS AND FLBAS The Forbearance Policy is as follows: * Forbearance means to reach an agreement with a borrower as determined on case-by-case basis, to renew, reschedule, defer payment, reamortize, refrain from initiating legal action against a borrower whose loan is in default or any other option not enumerated that allows the borrower to make payments on the loan. In considering borrower forbearance, the following conditions should be considered: Is the borrower cooperative? Is the borrower making an honest effort to meet the conditions Is the borrower capable of working out the debt burden as Before authorizing any foreclosure action against a borrower, the association shall consider, on a case-by-case basis, the above conditions for borrower forbearance. * In the event the borrower refuses to negotiate in good faith a plan for forbearance, the borrower breaches an agreement negotiated pursuant to this policy, or the borrower is not capable of working out of the debt burden, the association shall take whatever legal action it deems appropriate to protect the interest of the institution including, but not limited to, foreclosure. MEDIATION IN OKLAHOMA Farmer/Creditor Mediation is a concept whose time has come, throughout the United States. The way in which it is developed in each state has proven to be as varied as the states themselves. Each has been tailored to the specific needs and abilities of the state and its people. Whether it's a "barn-raising" or a disaster response, Oklahoma's strongest human forte is the willingness of people to reach out to help their neighbors, and that is the guiding spirit of Oklahoma's mediation process. Mediation in Oklahoma is generic: it's not just farmer/creditor—its landlord/tenant; fighting families; employer/employee; neighbor/neighbor; victim/offender - any community dispute. Mediation in Oklahoma is a local resource: when fully implemented, regional dispute mediation centers will be functioning throughout the state and individual mediators will be available in every community in the state to mediate disputes quickly, fairly, and with innovation. Mediation in Oklahoma uses volunteers: all mediators in Oklahoma serve without compensation. They volunteer for training to learn to mediate various community disputes. They may seek training in specialized mediation techniques for specialized conflict (farmer/creditor; divorce; victim/offender), then offer to serve their community a few hours a month. A description of an Oklahoma mediator is on the other side of this page. Mediation in Oklahoma is voluntary: referrals come from any source in the community, but the parties must agree to meet together and, with the aid of a neutral and trained third party, volunteer to solve their problem themselves. Mediation in Oklahoma demonstrates collaboration: of governments; of religious partnerships; of public and private sectors; of people building community power. The program operates under the guidance (through regulations) of the Oklahoma Supreme Court. The regional centers may be developed by cities, counties, or District Attorneys. Funding for most programs and most mediator training originates from filing fees on civil cases. Farmers/creditor mediation training is funded by the Agriculture Mediation Program (AMP), a program of the State Department of Agriculture. AMP is operated under contract by the Oklahoma Conference of Churches, a 501 (c) (3) organization representing 18 religious denominations, and funded by the Department of Agriculture, Oklahoma Farmers Union, and the Farm Credit Services of Wichita. Guidance and technical assistance for AMP is provided by the Special Task Force on the Farm Crisis of the Oklahoma Bar Association Mediation in Oklahoma is on the move: At the present time mediation services are available at the following locations Statewide: Consumer/Merchant disputes Office of the State Attorney General Statewide: Farmer/Lender disputes Pawnee and Osage Counties: Pawnee/Osage Dispute Mediation Program Payne and surrounding counties: Dispute Resolution Center Major, Alfalfa, Blaine, Garfield, Grant, Harper, Woods, and Woodward Counties: Major County Dispute Mediation Program Oklahoma County: Community Dispute Mediation Center Tulsa County: Project Early Settlement (405) 524-4511 1-800-AG8-LINK (918) 762-3464 (405) 624-9300 (405) 227-2011 (405) 236-0413 (918) 592-7786 Greer, Cotton, Texas, Grady, and Nowata counties will soon have regional programs serving a total of 26 additional counties. AMP has farmer/creditor mediators who will mediate statewide, out of the regional centers. Mediation in Oklahoma needs: YOUR HELP! (1) Neighbors volunteering to help the people in conflict in their community; (2) People referring disputes in their community to their dispute mediation center; and (3) Debtors and creditors alike participating in good faith to find solutions everyone can continue to live with. 2. who has good communication skills and can and does listen well; 3. is discreet and respects confidentiality; 4. is tolerant of and can work within a structured framework and maintain that framework under stress but without being controlling; 9. is aware of own values, biases and prejudices and can set them aside during the mediation process in order to be impartial and objective; 10. is responsible; 11. can maintain composure and encourage others to do likewise; and 12. has a belief in the capability of an individual to suggest and jointly negotiate and agree to solutions to his or her own problems. Senator CONRAD. I appreciate the testimony of all of you as members of this panel. I think this has been a very productive morning. We have gone section by section through the bill. We have gotten the reaction of the Administrator. We have found, to my dismay frankly, an attitude problem of rather serious proportions on the part of the Administrator. We have found a lack of seriousness in dealing with what is a desperate need. It is readily apparent to any of us who have been out in the small towns and farms across our States that there is an immediate need for change, an immediate need to revitalize and reform FmHA. It is our firm intention to include this in the credit package that will move through Congress this year. It must be done, and as you say most eloquently, it must be done now. Again, my personal thanks for the attendance of all of you. I just want you to know that already this hearing has received significant attention in the Congress. The fact is that we have, I think, for the first time, a growing consensus on the Agriculture Committee that it is imperative that Congress take action, and we simply cannot wait for the administration, and certainly not the Administrator of FmHA. Thank you very much. Mr. HUFF. Mr. Chairman. Senator CONRAD. Yes, sir. Mr. HUFF. I have some testimony here from the Dakota Resource Council, Dennis Dockter, farmer and mayor of Cogswell, North Dakota, I would like submitted for the record. Senator CONRAD. Without objection we will do that. Mr. HUFF. I also have a statement from Dorthea Schultz, on behalf of Big Horn Rural Alliance and Northern Plains Resource Council. We would also like to submit this statement for the record. Senator CONRAD. Without objection. Mr. HUFF. Thank you. [The prepared statements of Mr. Dockter, representing the Dakota Resource Council, and Dorthea Schultz, chairperson of the Big Horn Rural Alliance and board member of the Northern Plains Resource Council, follow:] 80-151 0 - 88 - 8 UNITED STATES SENATE COMMITTEE ON AGRICULTURE, NUTRITION AND FORESTRY TUESDAY, JUNE 9, 1987 TESTIMONY OF DAKOTA RESOURCE COUNCIL DENNIS DOCKTER, FARMER AND MAYOR OF COGSWELL, NORTH DAKOTA Mr. Chairman and Members of the Committee: My name is Dennis Dockter and I am a farmer from Cogswell, North Dakota. I am representing the Dakota Resource Council which is a grassroots membership organization dedicated to preserving family farm agriculture. The Dakota Resource Council is also a member of the National Save the Family Farm Coalition, and I serve on the Coalition's Fair Credit Committee. The Farmers Home Administration has strayed from its Congressionally intended purpose of providing credit to beginning and low equity borrowers. They are abandoning farmers now when the current situation in agriculture calls for leadership from what is supposed to be the lender of last resort. The recent federal court ruling in Bismarck, requiring FmHA to stop thousands of notices declared to be unconstitutional, further demonstrates the need to reform this agency which has lost sight of its intended purpose to help family farmers. Senate bill 1179 has several important features to help us out on the farm. The debt settlement provisions of this bill can help save farmers like myself and my neighbors. Many of us are threatened with the loss of our land, our chattel, our homes and our way of life. Instead of debt write down and other loan servicing options, we face foreclosure and liquidation. Nobody gains from this type of action. The FmHA must help their borrowers by offering them loan servicing, which Congress intended. This would save the taxpayers significant amounts of money since the government would, in many instances, lose much more through foreclosures than restructuring. The provisions in this bill would enable eligible borrowers to stay in business without going through the court system. It would eliminate the unnecessary and expensive court costs and attorney's fees which can further destabilize financially strapped farmers. We also need legislation which strengthens the first right of refusal for previous owners, and allows the borrower to request that FmHA sign a lease agreement with that farmer before the agency actually acquires the land. This will give us some |