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In keeping with the provisions of the Agricultural Credit Act of 1987, Title 5 "State Mediation Programs," the State of Utah has implemented the following voluntary mediation program.

It is important for farmers and lenders to understand what farm credit mediation is and how it is being implemented in Utah.

Mediation is a process used to solve problems and settle disputed issues related to farm credit, debt restructure and voluntary liquidation of farm property. Mediation introduces a neutral third party into borrower and lender discussions in order to facilitate discussion and generate alternative plans. All decisions are made by the borrowers and lenders. Farmers and creditors come to mediation with the understanding that they will seek a mutually agreeable solution that, in the best way possible, meets the needs of all parties. It is not intended to replace the serious good faith bargaining and discussion inherent in borrow/lender relationships.

On behalf of our Agricultural Farm Credit Advisory Committee, we are pleased to offer this voluntary mediation program as an excellent resource for the farmers and lenders who find themselves in a conflicting situation.

Sincerely,
Leonard M. Blackham, Commissioner

FARM CREDIT MEDIATION

At the request of the governor, a program for farm debt mediation was established in the state of Utah in November of 1988. The Farm Credit Mediation program has been in effect for seven years in Utah. This program is available to any lender or borrower upon the request of either party. A formal request must be made to the State Department of Agriculture. Forms for application are available by calling 538-7100 or writing the Utah State Department of Agriculture at 350 North Redwood Road, Salt Lake City, Utah 84116.

GUIDELINES

1. The Utah Ag Mediation is strictly a voluntary program for borrowers and lenders and must be agreed to by both parties.
2. Ag mediators must maintain strict neutrality. A posture of neutrality is just as important for the administration of the program as it is for the mediation itself.
3. Mediation services may be requested by either the borrower or the lender. If one or the other does not agree to mediation within 30 days, it will be determined that the obligations of mediation have been met. If mediation is agreed to, the process shall not exceed six months duration.
4. Utah State University Cooperative Extension Services will provide technical assistance to borrower, lender, or mediator.
5. Extension Services personnel will not act as mediators but as resource for the parties involved in the mediation process.
6. The request for and participation in the mediation process does not stay or eliminate any participant's legal rights or the enactment of legal proceedings.
7. All procedures established by the mediator are to be reviewed and approved by the Ag Mediation Advisory Board or program coordinator.
8. The mediator is to take great care not to create false hope in the potential participants. All parties should understand that the mediation may conclude without an agreement which resolves the dispute. The inability to reach an agreement should not be regarded as a failure of the mediation process.
9. The ag mediator will be contracted with and supervised by the Utah Department of Agriculture.
10. The Utah Department of Agriculture will pay the initial training cost of an approved training program. Should the mediator not meet the terms of the contract, training expenses will be reimbursed to the Department on a prorated basis.
11. To help defray the cost of this program, the borrower and lender will be assessed $25.00 per hour for each hour of actual mediation.
12. The Department of Agriculture will periodically review the mediation program, evaluate the performance of the mediator and report to the advisory board.
13. Liability responsibilities of the Department of Agriculture or the mediation board will be governed by the State Risk Management Act.
14. Mediation meetings will be held at neutral locations and all parties who agree to participate are required to attend the meetings on a regular basis. They must provide full information about the financial obligations at issue, and they must participate in generating realistic alternative plans for debt restructuring with a willingness to negotiate a settlement.

USDA Certified State Mediation

Section 282 of Title II of the Federal Crop Insurance Reform and the Department of Agriculture Reorganization Act of 1994 (Act) (Public Law 103-354, October 13, 1994) expands the State Mediation Programs to include: Wetland determinations, conservation compliance, agricultural credit, rural water loan programs, grazing on National Forest System lands, pesticides, and other issues the Secretary deems appropriate. Section 275 of the Act requires that if a USDA certified state mediation program is available as part of the informal hearing process, the appeal participant will be offered mediation.

Utah Agricultural Mediation Program - An Overview

PURPOSE
The Utah Ag Mediation Program is to provide for mediation of debt disputes between agricultural borrowers and lenders.

AG MEDIATION ADVISORY BOARD
Representation on the Ag Mediation Board shall be from the following organizations: Farm Credit Services, Farmers Home Administration, Utah Bankers Association, Independent Bankers Association, Utah Department of Agriculture, Cooperative Extension, Utah Farm Bureau, Utah Farmers Union. The Ag Mediation Advisory Board is responsible for:

• Creating the Ag Mediation Program.
• Providing ongoing direction to the Ag Mediation Director on an as needed basis.
• Providing ongoing evaluations to improve effectiveness of the program.

MEDIATOR
The Mediator leads and manages the discussion as a neutral party. The Mediator's responsibilities are:

• Complete an approved farm mediation training program.
• Acquire and maintain mediation skills and the farm finance aspects of ag credit mediation.
• Coordinate mediation activities with extension personnel.
• Schedule and organize meetings for each case.
• Inform creditors and farmers about the mediation process, procedures, time lines, etc.
• Review the facts and assist in generating alternatives for debt restructuring discussions.
• Inform farmers and creditors of assistance programs.
• Bring cases to conclusion within specified time period.
• Complete and maintain care records.
• KEEP FINANCIAL INFORMATION AND DISCUSSIONS CONFIDENTIAL.

COOPERATIVE EXTENSION SERVICES
Provide technical assistance to borrowers, lenders and mediators.

POSITION DESCRIPTION: MEDIATOR, AG CREDIT MEDIATION PROGRAM

Description of program: The 1987 Agricultural Credit Act provides for mediation of debt disputes between farmers and lenders.

Role of mediator: The mediator leads and manages discussion between lenders and borrowers as a neutral party when the parties are not able to resolve differences. Mediators do not provide legal advise but serve as a possible alternative conflict resolution mechanism to legal action. ALL FINANCIAL DECISIONS ARE MADE BY CREDITORS AND FARMERS. Under the law, mediators are immune from civil liability for actions as mediators.

Qualifications:
Education:
B.S. Degree or life experience equivalence with training in some combination of the following areas: farm management, finance, credit, accounting, law, business management, counseling, real estate, teaching, extension.

Experience:
Work or volunteer experience in civic activities, budget committees, record keeping, negotiating contracts, leading support groups, appraisals, organizing projects or people, managing small business.

Skills and abilities:

1. Ability to function as a neutral party. Willingness to see both creditors' and farmers' issues. Must function without showing bias toward farmers or creditors.
2. Strong communication skills in listening, speaking and clarifying issues, writing and record keeping.
3. Ability and willingness to manage conflict in groups.
4. Commitment to confidentiality.
5. Ability to inform, strategize, negotiate, and follow a project through to completion.
6. Ability to apply knowledge of the law, credit and legal issues to farm mediation cases.

Responsibilities:

1. KEEP FINANCIAL AND PERSONAL INFORMATION AND DISCUSSIONS CONFIDENTIAL.
2. Complete an approved farm mediation training program.
3. Acquire and maintain mediation skills and the farm finance aspects of ag credit mediation.
4. Coordinate mediation activities with extension personnel.
5. Schedule and organize meetings for each case.
6. Inform creditors and farmers about the mediation process, procedures, time lines, etc.
7. Review the facts and assist in generating alternatives for repayment of debt.
8. Inform farmers and creditors of assistance programs.
9. Bring cases to conclusion within specified time period.
10. Complete and maintain case records including a log recording time spent on preparation, actual mediation discussions, time spent on the phone, contacts and report to the committee or department of agriculture representative.

MEDIATOR, AG CREDIT MEDIATION PROGRAM

Description of program: The 1987 Agricultural Credit Act provides for mediation of debt disputes between farmers and lenders.

Role of mediator: The mediator leads and manages the discussion as a neutral party. ALL FINANCIAL DECISIONS ARE MADE BY CREDITORS AND FARMERS. Under the law, mediators are immune from civil liability for actions as mediators. The mediator will meet with the parties to determine unsolved problems and based on the findings of the two parties will make recommendation to the mediation committee. He/she will coordinate mediation activities with extension personnel, inform creditors and farmers about the mediation process, procedures, time lines, etc., and inform farmers and creditors of assistance programs.

Successful bidder must show proof of experience in the knowledge of financial contracting loan acquisitions with an emphasis in farm industry. Work or volunteer experience with budget committees, record keeping, negotiating contracts, leading support groups, appraisals, organizing projects or people, managing small business.

Applicant selected will be hired under contract by the Department of Agriculture and will be paid in an amount not to exceed two hundred fifty dollars ($250.00) per case.

AG MEDIATION ADVISORY COMMITTEE

• Kyle Stephens, Chairman
  Utah Department of Agriculture and Food
  
  
• Ken R. Ashby
  Utah Farm Bureau
  
  
• DeLynn Barton
  State Bank of Southern Utah
  
  
• Willis G. Candland
  Zion's Bank
  
  
• Bruce E. Godfrey
  USU Extension Service
  
  
• Howard Headlee
  Utah Bankers Association
  
  
• Wayne Probst, Mediator
  
  
• Don Rasmussen
  Farm Service Agency
  
  
• Lee Reese
  Utah Farmers Union
  
  
• Booth Wallentine
  Utah Farm Bureau
  

• Richard Weathered
  Utah Farm Credit System

FARM CRISIS AND FAMILIES

Every family knows it is inevitable that they will experience crisis in their lives. However, most families do not plan for it. Just as the terminally ill person holds the hope a cure for their disease will be found in time to help them, the farm family hopes the solution to their farm financial problem will be discovered before it is too late. When the certified letter arrives, this hope is shattered.

As your family goes through the farm financial crisis, it is important to remember that it affects your family as well as the farm business. As you discuss your farming options and look at the farm financial picture, remember that communication within the family and with friends is important.

Crisis results when a person or family is faced with an important problem or task which cannot be easily handled by normal problem solving approaches or tactics. It includes or results from an event or circumstance (such as a creditor's notice), and the family reaction to the problem. Up to this point, you have probably denied the problem, or hoped that a solution could be found. When the certified letter from the creditor arrives, this is a turning point - for better or worse. Your situation will probably not be the same again. Now you must deal with the situation.

Most of us are able to deal with our emotions when there is the death of a loved one. Few are aware that people go through a similar grieving process when experiencing other losses. As you go through farm financial crisis, the feelings of anger, blame, denial, depression and guilt are normal.

It is our sincere hope that this mediation program will provide for you the assistance and tools necessary to work your way through this crisis period.