Rep. Steve Watkins (R-Kan.) on Tuesday introduced the Enhancing Credit Opportunities for Rural America Act (H.R. 1872), which would end taxation of interest earned from agricultural real estate loans. This ABA-advocated bill would provide rural bankers with the same tax status as Farm Credit System lenders when making loans secured by ag real estate, thus leveling the playing field between banks and the tax-advantaged FCS.

“Small town lenders are crucial to the viability of rural America. Community banks and their ag customers have unfortunately had to adjust to years of weak commodity prices while family farm debts have become increasingly highly-leveraged. In fact, farm delinquencies are sadly at their highest rate in nine years. This timely legislation would give greater certainty to small town folks by enhancing and expanding rural access to credit,” said Congressman Watkins.