Farm Credit Administration Fiscal Year 2022 Proposed Budget and Performance Plan Farm Credit Administration FY 2022 Proposed Budget and Performance Plan Table of Contents Part I Fiscal Year 2022 Proposed Budget ................................................................................ 1 Fiscal Year 2022 Budget Overview ................................................................................................. 3 Budget Trends ................................................................................................................................. 8 Assessments ................................................................................................................................... 12 Part II Farm Credit Administration ....................................................................................... 15 Profile of the Farm Credit Administration .................................................................................... 17 FCA Internal Operations............................................................................................................... 20 Ensuring Safety and Soundness ................................................................................................... 30 Developing Regulations and Policies ............................................................................................. 37 Part III Farm Credit System .................................................................................................. 43 Profile of the Farm Credit System .................................................................................................45 Financial Condition and Performance .......................................................................................... 49 Young, Beginning, and Small Farmers and Ranchers .................................................................. 60 Market Share of Farm Debt .......................................................................................................... 63 Part IV Performance Budget FY 2022 .................................................................................. 65 Performance Budget Overview ......................................................................................................67 Desired Outcomes for Strategic Goals .......................................................................................... 69 Performance Measurement and Reporting ................................................................................... 75 i Farm Credit Administration FY 2022 Proposed Budget and Performance Plan List of Tables Table 1. Farm Credit Administration FY 2022 proposed budget ................................................... 3 Table 2. Information resource management plan initiatives ......................................................... 6 Table 3. FCA budgets, FYs 2020 – 2022 ........................................................................................ 9 Table 4. FCA actions and resulting impact .................................................................................... 10 Table 5. Budgeted sources of FCA revenue and funding, FYs 2020 – 2022 ................................. 11 Table 6. FCS assessments, FYs 2012 – 2021 ................................................................................. 12 Table 7. FCA funding, obligations, and assessment carryover, FYs 2019 and 2020 (in millions) 13 Table 8. FCA’s net cost to System borrowers, FYs 2012 – 2021 .................................................... 14 Table 9. Farmer Mac assessments, FYs 2012 – 2021 .................................................................... 14 Table 10. Full-time-equivalent staffing levels, FYs 2012 – 2022 .................................................. 21 Table 11. FCA retirement eligibility, FYs 2020 – 2025 ................................................................. 22 Table 12. FYs 2020 and 2021 locality rates ...................................................................................25 Table 13. Shared services, FY 2021 ................................................................................................25 Table 14. Competitive consulting service contracts of more than $25,000, FY 2020 ................. 26 Table 15. Competitive consulting service contracts of more than $25,000, FY 2021 ................... 27 Table data for figure 2 ................................................................................................................... 34 Table 16. Net income (dollars in millions).................................................................................... 50 Table 17. Interest margin in annualized percentages .................................................................... 51 Table 18. Profitability across System districts for the first nine months of year ........................... 51 Table 19. Gross loan growth by district and Systemwide (dollars in millions) .............................52 Table data for figure 4 ....................................................................................................................53 Table 20. FCS investments (dollars in millions) ...........................................................................54 Table 21. FCS loan quality.............................................................................................................. 55 Table 22. Systemwide debt (dollars in millions) ...........................................................................56 Table 23. FCS capital composition (dollars in millions) ............................................................... 57 Table 24. Regulatory capital ratios of FCS banks ......................................................................... 58 Table 25. YBS loans made during 2019 (as of December 31, 2019) ............................................. 62 Table 26. YBS loans outstanding (as of December 31, 2019) ....................................................... 63 Table 27. FCA performance budget, FYs 2020 – 2022 ................................................................. 67 Table 28. FY 2022 proposed budget and full-time equivalents for program activities ................ 68 ii Farm Credit Administration FY 2022 Proposed Budget and Performance Plan Table 29. Desired outcomes for strategic goals ............................................................................ 69 Table 30. Goal 1 — Performance measures ................................................................................... 71 Table 31. Budgets to achieve goal 1 ................................................................................................ 71 Table 32. Goal 2 — Performance measures ................................................................................... 73 Table 33. Budgets to achieve goal 2 ............................................................................................... 73 Table 34. Goal 3 — Performance measures ................................................................................... 74 List of Figures Figure 1. FCA organizational chart as of January 2021 ................................................................ 20 Figure 2. Farm Credit System Financial Institution Rating System (FIRS) composite ratings ... 33 Figure 3. The chartered territories of Farm Credit System banks as of January 1, 2021 ............. 46 Figure 4. Year-over-year percent change in System assets, September 2010 – 2020 ..................52 iii Farm Credit Administration FY 2022 Proposed Budget and Performance Plan List of Acronyms and Abbreviations ACA ...........................................agricultural credit association CAMELS ...................................capital, assets, management, earnings, liquidity, and sensitivity Farm Credit Act.........................Farm Credit Act of 1971, as amended Farmer Mac ...............................Federal Agricultural Mortgage Corporation FCA............................................Farm Credit Administration FCS or System ...........................Farm Credit System FCSIC ........................................Farm Credit System Insurance Corporation FIRREA .....................................Financial Institutions Reform, Recovery, and Enforcement Act FIRS ..........................................Financial Institution Rating System FLCA .........................................Federal land credit association FTE ............................................full-time equivalent FTP ............................................full-time permanent FY ..............................................fiscal year Funding Corporation ................Federal Farm Credit Banks Funding Corporation GSE ...........................................government-sponsored enterprise IT ...............................................information technology NCB ...........................................National Consumer Cooperative Bank OSMO ........................................Office of Secondary Market Oversight PCA ...........................................production credit association RBC ...........................................risk-based capital USDA ........................................U.S. Department of Agriculture YBS ............................................young, beginning, and small (farmers and ranchers) iv Farm Credit Administration FY 2022 Proposed Budget and Performance Plan Preface The Farm Credit Administration is an independent agency in the executive branch of the U.S. government. We are responsible