CHARLESTON, W.Va. -- A bill moving through the West Virginia Senate would establish rules governing the Rural Rehabilitation Loan Program under the state's Department of Agriculture.
The program recently came under fire when an audit of the department discovered more than half the loans are delinquent and there was no effort to collect payments.The audit also found conflict of interests between then-Agriculture Commissioner Gus Douglass, the loan board and some of the loan's recipients. Senate Bill 350 hopes to rectify that.
"They've stopped internally from making loans due to the audit," Senate Agriculture Committee counsel Noelle Starek said. "There are no rules or regulations in place regarding the loan program as far as the new administration can tell."
Chris Ferro, chief of staff for the department, told the committee there are two types of loan programs the department oversees-one the department runs solo and another where it works with its federal counterpart, the Farm Service Agency.
"The commissioner (Walt Helmick) has entertained some proposals that would be joint loans through FSA because FSA does have different requirements," he said.
Ferro said the department is working to compile status reports on the delinquent loans.
"The commissioner has requested a report himself," Ferro said. "He's curious about that, to see the status, how much delinquent, et cetera."
Ferro said all reports would be shared with the Senate Agriculture Committee.
An amendment to the bill extend the term "agricultural purposes" in the bill to "agricultural or related purposes." Starek said under the new definition loans could be extended to local food suppliers and similar entities.
"The idea is to establish some parameter in the code regarding the scope of what loans could be given under the loan rehabilitation program," Starek said. "We want them to be agriculture related. That can be extended in the rules under much more detail. We can also maybe deal with local food products or that kind of thing."
The amended bill passed out of the Senate unanimously. It will now go to the Senate floor.