Farm Credit Administration Board Policy Statements, 71142-71160 [05-23237]

Agencies

• Farm Credit Administration

[Federal Register Volume 70, Number 226 (Friday, November 25, 2005)]
[Notices]
[Pages 71142-71160]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-23237]


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FARM CREDIT ADMINISTRATION


Farm Credit Administration Board Policy Statements

AGENCY: Farm Credit Administration.

ACTION: Notice.

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SUMMARY: The Farm Credit Administration (FCA) Board recently undertook 
a review of all FCA policy statements, resulting in their repeal, 
amendment or readoption. All 15 current policy statements are included 
in this notice.

DATES: The effective date is indicated on each individual policy 
statement set forth below.

FOR FURTHER INFORMATION CONTACT: Wendy Laguarda, Senior Counsel, Office 
of General Counsel, Farm Credit Administration, 1501 Farm Credit Drive, 
McLean Virginia 22102-5090, (703) 883-4020, TTY (703) 883-4020.

SUPPLEMENTARY INFORMATION: A list of all current FCA Board policy 
statements and the text of each are set forth below in their entirety:

FCA Board Policy Statements

FCA-PS-34 Disclosure of the Issuance and Termination of Enforcement 
Documents
FCA-PS-37 Communications During Rulemaking
FCA-PS-41 Alternative Means of Dispute Resolution
FCA-PS-44 Travel
FCA-PS-53 Examination Philosophy
FCA-PS-59 Regulatory Philosophy
FCA-PS-62 Equal Employment Opportunity Programs and Diversity
FCA-PS-64 Rules for the Transaction of Business of the Farm Credit 
Administration Board
FCA-PS-65 Release of Consolidated Reporting System Information
FCA-PS-67 Nondiscrimination on the Basis of Disability in Agency 
Programs and Activities
FCA-PS-68 FCS Building Association Management Operations Policies 
and Practices
FCA-PS-71 Disaster Relief Efforts by Farm Credit Institutions
FCA-PS-72 Financial Institution Rating System (FIRS)
FCA-PS-77 Borrower Privacy
FCA-PS-78 Official Names of Farm Credit Institutions

[[Page 71143]]

Disclosure of the Issuance and Termination of Enforcement Documents

FCA-PS-34

    Effective Date: 27-JAN-05.
    Effect on Previous Actions: BM-13-JAN-94-03 (FCA-PS-57).
    Source of Authority: None.
    The Farm Credit Administration (FCA) Board finds that it is in the 
best interest of the Farm Credit System (FCS), the FCA, and the public 
that certain information concerning the issuance and any subsequent 
termination of final enforcement orders, formal agreements and 
conditions imposed in writing (Enforcement Documents) be disclosed to 
the FCS and the public. Specifically, the basis for disclosing this 
information is to communicate to the FCS and the public that the FCA is 
effectively using its enforcement powers through the issuance of 
Enforcement Documents and the subsequent termination of such 
Enforcement Documents, when appropriate.

The FCA Board Hereby Adopts the Following Policy Statement

    Upon issuance or termination of any Enforcement Document, the 
Office of Examination shall notify the Director of the Office of 
Communications and Public Affairs (OCPA) of such event. OCPA shall 
prepare, for release to the FCS and the public, a disclosure, subject 
to the concurrence of the Office of General Counsel (OGC). If the OGC 
determines that a disclosure adversely affects a civil or criminal 
investigation, the disclosure will not be made. The disclosure shall 
include the information described below:
    1. The type and date of action taken;
    2. The type of institution to which the action pertains, or if the 
action pertains to an individual or entity, the relationship between 
the individual or entity and the institution; and
    3. A description of the essential facts pertaining to the action, 
excluding information that would identify the institution and/or 
persons involved.

    Dated this 27th day of January, 2005.

    By Order of the Board.

Jeanette C. Brinkley,
Secretary to the Board.

Communications During Rulemaking

FCA-PS-37

    Effective Date: 27-JAN-05.
    Effect on Previous Actions: Replaces previous Farm Credit 
Administration (FCA or Agency) Board policy on public communications 
during a rulemaking, adopted March 25th, 1992. See 57 FR 11083, April 
1, 1992.
    Source of Authority: None.
    The FCA Board finds that it is in the public interest and 
consistent with the requirements of the Administrative Procedure Act to 
revise its policy on communications with the public during the 
rulemaking process.

The FCA Board Hereby Adopts the Following Policy Statement

    In keeping with the need to ensure an open, freely accessible, and 
well-informed rulemaking process while balancing the need for 
impartiality and fairness, the FCA adopts the following guidelines 
governing substantive oral communications between the public and Board 
members and staff during the course of a related rulemaking.

Before a Rulemaking Begins

    Unrestricted communication with the public before rulemaking begins 
supports and promotes the Agency's efforts to design creative and 
effective regulatory policy. No specific guidelines apply to that 
communication.

From Publication of Notice of Proposed Rulemaking to the End of the 
Comment Period

    After a particular rulemaking has begun with publication of a 
notice of proposed rulemaking (including publication of an advance 
notice of proposed rulemaking), FCA encourages members of the public to 
provide written comments during the public comment period. All written 
comments are placed in a public file, where they are available for 
examination and copying during normal business hours. The comments 
receive careful consideration and become part of the public record of 
the rulemaking.
    Where appropriate, FCA may also conduct public hearings or open 
meetings to take testimony or hold discussions on a rulemaking. Such 
opportunities for comment from the public will be announced in advance 
and the comments received will be placed in the public rulemaking file.
    Substantive oral communications during the comment period between 
FCA personnel, including Board members and staff, and members of the 
public regarding the subject of an ongoing rulemaking will be 
summarized in writing and placed in the public rulemaking file. While 
FCA personnel are always available to explain or clarify proposed 
rules, if an individual wants to engage FCA personnel in substantive 
discussion concerning a published proposed rule, he or she should first 
file a written comment covering the matter to be discussed, 
particularly if he or she has not already filed a written comment. If 
new substantive comments are discussed, FCA staff will reduce the 
substance of such comments to writing, promptly place it in the public 
rulemaking file, and urge the individual to submit a written comment.

From the Close of the Comment Period to the Adoption of the Final Rule

    From the close of the comment period until adoption of the final 
rule, substantive discussions between members of the public and FCA 
personnel relating to the proposed rule should be curtailed. In the 
interest of fairness, if new facts or arguments must be brought to the 
attention of the FCA, the communication must be in writing so that it 
can promptly be placed in the public rulemaking file.
    FCA believes these guidelines will help ensure a complete 
rulemaking record for future agency consideration of the rule or in the 
event of court review. Further, FCA strongly believes that the 
rulemaking process must be open and evenhanded in order to avoid even 
the appearance of impropriety or undue influence that might arise from 
private communication during certain periods. Finally, if a substantive 
comment on a proposed rule were transmitted to FCA in a private 
communication that did not become part of the public record, other 
members of the public would not have an opportunity to respond to any 
new arguments or facts contained in that communication. Because FCA 
believes that its rulemaking process benefits from give and take among 
commenters who are able to consider each others' comments, this policy 
statement requires all comments to be placed in the public rulemaking 
file.
    This policy statement does not apply to public communications 
regarding any rulemaking issue unless and until the matter becomes the 
subject of a notice of proposed rulemaking. Nothing in the policy 
statement is meant to affect the ability of FCA to use negotiated 
rulemakings, open meetings or other types of public forums to augment 
its rulemaking under section 553 of the Administrative Procedure Act.

    Dated this 27th day of January, 2005.

    By Order of the Board.

Jeanette C. Brinkley,
Secretary to the Board.

Alternative Means of Dispute Resolution

FCA-PS-41

    Effective Date: 27-JAN-05.
    Effect on Previous Action: Originally adopted 16-JUL-92 (see 57 FR 
33198,

[[Page 71144]]

July 27, 1992); amended 30-MAY-96; amended 10-FEB-97.
    Source of Authority: Administrative Dispute Resolution Act of 1996, 
Public Law 104-320, 110 Stat. 3870 (1996), and codified at 5 U.S.C. 571 
et seq.
    The Administrative Dispute Resolution Act of 1996 (Act), addresses 
the concern that traditional methods of dispute resolution, such as 
litigation and administrative adjudication, have become increasingly 
time-consuming and expensive. The Act authorizes and encourages greater 
use of alternative means of dispute resolution (ADR), requiring each 
Federal agency to adopt a policy addressing the use of ADR.
    ADR consists of informal, voluntary procedures used by parties who 
seek to resolve their disputes by consent. Such procedures include, but 
are not limited to, mediation, conciliation, facilitation, fact-
finding, arbitration, and mini-trials, or any combination thereof. By 
emphasizing the common goals of the parties and fostering an atmosphere 
of cooperation, ADR can offer a less contentious and more expeditious 
alternative to traditional methods of dispute resolution such as 
litigation and administrative adjudication.
    The use of ADR in appropriate circumstances is consistent with the 
Farm Credit Administration's (FCA or Agency) mission as an agency. To 
promote a safe and sound, competitive Farm Credit System, the FCA 
always strives to effectively and efficiently manage its resources. By 
expediting the resolution of certain disputes, ADR can reduce the FCA's 
transaction costs, increase the FCA's productivity, and help the FCA 
accomplish its goals.

The FCA Board Hereby Adopts the Following Policy Statement

    It is the policy of the FCA to resolve disputes in an effective and 
efficient manner. Many of the disputes encountered by the FCA are 
resolved most effectively and efficiently through settlement 
negotiations between the FCA and the other parties to the disputes 
prior to the initiation, or in the early stages of, more formal 
litigation or administrative adjudication. The FCA will continue to use 
settlement negotiations as a method of dispute resolution.
    In addition, the FCA will consider whether it is appropriate to use 
ADR when a dispute arises. In assessing the advisability of using ADR 
procedures, as defined in 5 U.S.C. 571(3), the FCA will consider 
whether such procedures are likely to reduce the FCA's transaction 
costs, increase the FCA's productivity, and help the FCA accomplish its 
goals of effective regulations and policies and the enhancement of 
FCA's effectiveness and cost efficiency. The FCA will also consider the 
factors set forth in 5 U.S.C. 572(b) in deciding whether it is 
appropriate to use such ADR procedures.
    The FCA's Dispute Resolution Specialist (ADR Specialist), 
designated by the Chairman, is responsible for the implementation of 
this policy statement. The ADR Specialist is available to assist FCA 
personnel in considering the appropriate application of ADR procedures. 
Before deciding whether it is appropriate to use an ADR procedure, FCA 
personnel will consult with, and obtain the concurrence of, the ADR 
Specialist or his or her designee.
    The ADR Specialist and those FCA personnel involved in resolving 
disputes are encouraged to attend educational and training programs 
relating to the theory and application of ADR on a regular basis, as 
the FCA budget permits.
    Based on the voluntary nature of ADR, all parties to a dispute must 
agree to use an ADR procedure before it can be initiated.

    Dated this 27th day of January, 2005.

    By Order of the Board.

Jeanette C. Brinkley,
Secretary to the Board.

Travel

FCA-PS-44

    Effective Date: 27-JAN-05.
    Effect on Previous Actions: Originally adopted 13-JUN-91; amended 
12-NOV-92.
    Source of Authority: 5 U.S.C. 7351, 7353; 5 U.S.C. App. (Ethics in 
Government Act of 1978); E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p. 
215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306; 
12 U.S.C. 2242 (Section 5.8 of the Farm Credit Act of 1971, as 
amended), 41 CFR Part 301.

The FCA Board Hereby Adopts the Following Policy Statement

    Members of the Farm Credit Administration (FCA or Agency) Board 
(we) are not subject to the same requirements regarding allowances for 
travel and subsistence that generally apply to officers and employees 
of the United States (section 5.8 of the Farm Credit Act of 1971, as 
amended). Nevertheless, it is the general policy of the FCA Board 
(Board) that we will travel on official business in the most economical 
fashion reasonable under the circumstances.
    We are subject to Federal laws, rules, and Executive Orders 
relating to conflicts of interest that may result from accepting gifts, 
including travel related expenses, from outside sources. Generally, we 
may not accept anything of value from:
     A person seeking official action from, doing business 
with, or conducting activities regulated by the FCA, or
     A person whose interests may be substantially affected by 
the performance or nonperformance of our official duties.
    Such persons are prohibited sources. (See Executive Order 12674, as 
amended; 5 U.S.C. 7353; and 5 CFR Part 2635, the Executive Branch-wide 
standards of ethical conduct issued by the Office of Government 
Ethics.) An organization is also a prohibited source if more than half 
of its members are prohibited sources.
    The gift rule under the standards of ethical conduct and the 
Agency's gift acceptance authority at 31 U.S.C. 1353 outline the 
limited circumstances in which we may accept gifts and the payment of 
travel expenses from outside sources. Unless an exception applies, 
ethics rules prevent us from accepting gifts offered to us because of 
our official position. Under no circumstances may we accept anything of 
value in return for being influenced in the performance of an official 
act. The aim of these rules is to prevent an actual conflict of 
interest or the appearance of a conflict and to uphold public 
confidence in the integrity of the Government and the Agency.
    Except as noted above, third parties may not pay for official 
Agency expenditures. Because the Agency is responsible for the cost of 
conducting official business, we will ensure that the Agency is billed 
directly for travel expenses whenever possible (for example, by using 
our Government credit card for travel expenses). On those occasions 
when direct Agency payment is impossible or impractical (for example, a 
large group business dinner arranged and paid for in advance by the 
organizer), we will promptly notify the Agency of the obligation and 
ensure that the payer is promptly reimbursed. We recognize that it is 
important not to create the impression that a third party, particularly 
a prohibited source, is paying for our expenses.

Travel

Transportation

    We will use less than first-class accommodations for all modes of 
transportation except in circumstances where:

[[Page 71145]]

    1. We must use first-class accommodations because no other space 
accommodations are reasonably available or where other practical 
considerations exist (such as to accommodate a disability or other 
special need);
    2. Exceptional security circumstances require it;
    3. The conduct of Agency business requires it; or
    4. We receive first-class travel benefits on an unsolicited basis 
from a carrier (such as free first-class coupons) and the benefit 
cannot be used by the Agency either in the present or the future, 
cannot be redeemed for cash value, and does not require the redemption 
of official miles. Under these circumstances, we can use the first-
class benefit for either official or personal travel.
    We will use a commercial charter flight at Agency expense only when 
no commercially scheduled flights are available in time to meet the 
requirements of the travel or when the charter flight would be more 
economical than a commercial flight. We will avoid the use of private 
aircraft whenever possible and use them only where commercial or 
charter flights are not reasonably available or would impose undue 
hardships. When reporting travel expenses, we must adequately justify 
the use of a commercial charter flight, private aircraft, or first-
class accommodations.

Lodging

    When available and practical, we will book lodging at the 
Government rate or another available reduced rate at hotels and motels. 
When attending a convention, meeting, or other official activity, we 
ordinarily obtain lodging at the hotel or motel holding the activity 
even if reduced rates are available elsewhere. We may book more than 
one room when necessary for the conduct of official business on the 
premises.
    The Agency will not ordinarily reimburse us for lodging in the 
metropolitan Washington, DC, area. When conducting business in and 
around the official duty station in McLean, Virginia, we ordinarily 
reside at home.

Other Expenses for Official Activities

    The FCA will reimburse us for the usual and reasonable expenses we 
incur as a consequence of official activities in the Washington, DC, 
metropolitan area and in other locations. The Agency will allow the 
repayment of expenses for:
    1. Transportation costs;
    2. Meal costs;
    3. Registration fees or other fees assessed for attendance or 
participation;
    4. The cost of miscellaneous supplies needed to participate in a 
particular function or activity; and
    5. Other costs we incur by participating in official activities.
    The Agency will not allow reimbursement of expenses for official 
activity incurred on behalf of other persons, including relatives, 
except as provided in the Board policy on Official Function 
(Representation and Reception) Expenses.

Form of Payment

    We will arrange for official travel using the Agency's travel 
management system whenever possible. We may use cash to pay for 
official travel expenses and seek repayment from the Agency afterwards 
but, whenever possible, we will use the Government-issued credit card 
for all official travel expenses.

Receipts

    When filing claims for reimbursement of travel expenses, we will 
provide receipts for expenses as normally required of other FCA 
employees under the Federal Travel Regulation, which currently requires 
receipts for all lodging and travel expenses over $75. However, failure 
to provide a receipt as normally required is not grounds for denial of 
a claim. If we do not have a receipt, we will provide a statement 
explaining the nature and amount of the expense and the reason for not 
having a receipt.

Combining Official Business Travel With Personal Activities

    Although it is permissible to engage in personal activities while 
on official travel, the purpose of the trip must always be the need to 
conduct official business. The Agency pays for travel and related 
expenses incurred in performing official business. However, the Agency 
may not pay for personal expenses incurred while on official travel. 
Therefore, it is important to record and allocate expenses carefully to 
ensure that official expenses are clearly differentiated from personal 
expenses. Proper handling of Agency expenses is always important, but 
particularly so when engaging in personal activities while on official 
Agency business.
    We are aware that, in certain circumstances, engaging in personal 
activities while on official travel could create an appearance that 
personal activities, not official business, prompted the trip. When we 
take a trip to conduct official business, it is usually clear from the 
nature of our business that the trip is proper and necessary. If we are 
concerned that personal activities during the trip might suggest 
otherwise, we will consult the DAEO to avoid a possible appearance of 
impropriety. We understand that engaging in official travel that takes 
us to a given destination (for example, our home state) on a 
disproportionate basis may raise questions about whether the travel 
truly is necessary. Again, we will consult with the DAEO about such 
concerns.

    Dated this 27th day of January, 2005.

    By Order of the Board.

Jeanette C. Brinkley,
Secretary to the Board.

Examination Philosophy

FCA-PS-53

    Effective Date: 08-JUN-05.
    Effect on Previous Action: Responds to NV 93-04 (15-JAN-93) and 
Amends FCA Policy Statement 53 dated 15-JUL-93.
    Source of Authority: Sections 5.9 and 5.19 of the Farm Credit Act 
of 1971, as amended.

The Farm Credit Administration (FCA or Agency) Board Hereby Adopts the 
Following Policy Statement

    This policy provides a general philosophy and direction for the 
examination and oversight of the Farm Credit System (System).
    The FCA Board provides for the examination and supervision of each 
System institution in accordance with the Farm Credit Act of 1971, as 
amended (the ``Act''). The Board fulfills this responsibility primarily 
through the Office of Examination (OE) The FCA fulfills its supervision 
and examination responsibilities for Farmer Mac, a separate government-
sponsored enterprise, through its Office of Secondary Market Oversight. 
OE develops oversight plans, conducts examinations, monitors the 
System's condition, current and emerging risks, and develops 
supervisory strategies to ensure that the System operates in a safe and 
sound manner and fulfills its public policy purpose. The Act also 
provides that the Farm Credit System Insurance Corporation (FCSIC) 
Board of Directors should utilize FCA examiners to conduct examinations 
of System institutions, to the extent practicable.

Oversight and Examination

    The FCA Board directs the maintenance of a ``risk-based'' approach 
to oversight and examination for System institutions, which maximizes 
OE's effectiveness and strategically addresses the System's safety and 
soundness and

[[Page 71146]]

compliance with laws and regulations. Examination resources will be 
allocated to matters of highest risk or potential risk to the System at 
large and specific institutions to proactively address emerging risks. 
The amount of examination resources devoted to a System institution and 
the scope of an examination will depend on an institution's ability to 
identify and manage its risks. Accordingly, oversight and examination 
efforts will be heightened and accompanied by appropriate preventive, 
corrective, or enforcement actions when institutions are unable or 
unwilling to address material unsafe and unsound practices or comply 
with law and regulations. This risk-based approach is critical to 
maintaining shareholder, investor, and public confidence in the 
financial strength and future viability of the System.

Examination Staff and Communications

    The risk-based approach must promote effective communications with 
System institutions. Examiners are an essential communication link with 
System institutions through ongoing institution oversight, on-site 
examinations, meetings with boards and management, and written reports 
and correspondence. The examination program shall therefore maintain 
adequately trained examiners who understand the unique risks and 
opportunities of agriculture as principally a biological industry, 
maintain an appropriate level of regulatory and financial industry 
experience and skills, and communicate and work effectively with System 
institutions to ensure they remain safe and sound and able to fulfill 
their public policy purpose.

Reporting to the FCA Board

    Annually, the Chief Examiner will provide the Board an annual 
oversight and examination plan (plan) for approval. This plan will:
     Assess the condition of and risks affecting the System at 
large and in specific institutions;
     Establish priorities and identify staffing, training, and 
budgetary needs;
     Include an examination schedule that ensures statutory 
requirements are met; and,
     Include operational objectives and strategies for meeting 
the plan.
    The Chief Examiner will report semi-annually to the Board on the 
status of, and proposed adjustments to, the plan. The Chief Examiner 
will also report quarterly on the current condition of the Farm Credit 
System, emerging risks, and any necessary follow-up strategies.

    Dated this 8th day of June, 2005.

    By Order of the Board.

Jeanette C. Brinkley,
Secretary to the Board.

Regulatory Philosophy

FCA-PS-59

    Effective Date: 08-JUN-05.
    Effect on Previous Action: Originally adopted BM-17-FEB-94-02 (see 
59 FR 32189, June 22, 1994); see also 60 FR 26034, May 16, 1995.
    Sources of Authority: Farm Credit Act of 1971, as amended; 12 
U.S.C. 2001 et seq.

The Farm Credit Administration (FCA) Board Hereby Adopts the Following 
Policy Statement

    The FCA shall develop regulations consistent with its authorities 
under the Farm Credit Act of 1971 (Act), as amended, and other relevant 
statutes. It is the FCA Board's philosophy to (1) Promulgate 
regulations that are necessary to implement the law; (2) support 
achievement of the Farm Credit System's (System) public mission; and 
(3) ensure the System's safety and soundness.
    The FCA Board will strive to create an environment that promotes 
the confidence of customers and shareholders, investors, Congress, and 
the public in the System's financial strength and future viability. The 
FCA Board believes that safe and sound operations of System 
institutions will instill: (a) Investor confidence in System debt 
securities, which helps ensure that adequate funds are available at 
reasonable rates; and, (b) shareholder/member confidence in each 
cooperatively owned System institution by ensuring that sufficient 
financial resources are maintained to support an adequate supply of 
credit and other services to its shareholders/members in both good and 
bad times.
    FCA will give high priority to issues that enable the System to 
more effectively accomplish its mission and to those issues that pose 
significant risks to the successful operation of the System, with the 
intent of ensuring an adequate and flexible flow of money into rural 
areas. As such, the FCA Board intends to provide System institutions 
with the flexibility consistent with changes in law, agriculture, and 
rural America so institutions can offer high quality, reasonably priced 
credit and related services to farmers, ranchers, their cooperatives, 
rural residents, and other entities upon which farming operations are 
dependent.
    The strategies for accomplishing the Board's regulatory philosophy 
are as follows:
    1. We will develop regulations based on a reasoned determination 
that benefits of any proposed regulation justify its cost.
    2. We will focus our regulatory efforts on issues that address 
identified risks in System institutions or enhance the ability of 
System institutions to better meet the needs of agriculture and rural 
America. Preambles to regulations will explain the rationale for the 
regulatory approach adopted.
    3. We will utilize diverse approaches to encourage public 
participation in the development and review of regulatory proposals in 
appropriate circumstances.
    4. We will emphasize the cooperative principles of a farmer-owned 
Government-sponsored enterprise by advancing regulatory proposals that 
encourage farmer- and rancher-borrowers to participate in the 
management, control, and ownership of their institutions.
    5. We will work to eliminate unnecessary regulations that impair 
the ability of the System to accomplish its mission to serve 
agriculture and rural America and any regulations that are unduly 
burdensome, costly, or not based on the law.
    The details of how the FCA will implement these strategies will be 
described in the Agency's Five-Year Strategic and Annual Performance 
Plans and in its Unified Agenda.
    Semi-annually, the Director of the Office of Policy Analysis (OPA) 
will provide the Board a proposed Unified Agenda for approval. The 
Unified Agenda will describe the regulatory projects the Agency plans 
to work on during the next 12 month period and apply the principles and 
strategies reflected in this policy. Quarterly, the OPA Director will 
report to the Board on the status of, and proposed adjustments to, 
regulatory projects scheduled on the Unified Agenda.

    Dated this 8th day of June, 2005.

    By Order of the Board.

Jeannette C. Brinkley,
Secretary to the Board.

Equal Employment Opportunity Programs and Diversity

FCA-PS-62

    Effective Date: 12-SEP-02.
    Effect on Previous Action: Updates FCA-PS-62 [NV-94-44] 8-3-94.
    Source of Authority: Title VII of the Civil Rights Act of 1964, as 
amended (42 U.S.C. 2000e et seq.); Age Discrimination in Employment Act 
(29 U.S.C. 621 et seq.); Rehabilitation Act of 1973, as amended (29 
U.S.C. 721 et seq.); Equal Pay Act of 1974 (29 U.S.C. 206(d)); Civil 
Service Reform Act of

[[Page 71147]]

1978 (5 U.S.C. 3112); Executive Order 11478, as amended on May 2, 2000; 
Executive Order 13145, February 8, 2000; 29 CFR Part 1614; Equal 
Employment Opportunity Commission Management Directives.

Purpose

    The Farm Credit Administration (FCA) Board affirms its commitment 
to Equal Employment Opportunity and Diversity (EEOD) and provides 
guidance to Agency management and staff for deciding and taking action 
in these critical areas.

Importance

    Unquestionably, the employees who comprise the FCA are its most 
important resource. The Board fully recognizes the Agency draws its 
strength from the dedication, experience, and diversity of its 
employees. The Board is firmly committed to taking whatever steps are 
needed to protect the rights of its staff and to carrying out programs 
that foster the development of each employee's potential. We believe an 
investment in efforts that strongly promote EEOD will prevent the 
conflict and the high costs of correction for taking no, or inadequate, 
action in these areas.

The Farm Credit Administration (FCA) Board Adopts the Following Policy 
Statement

    It is the policy of the FCA to prohibit discrimination in Agency 
policies, program practices, and operations. Employees, applicants for 
employment, and members of the public who seek to take part in FCA 
programs, activities, and services will be treated fairly. FCA, under 
the appropriate laws and regulations, will:
     Ensure equal employment opportunity based on merit and 
qualification, without discrimination because of race, color, religion, 
sex, age, national origin, disability, sexual orientation, status as a 
parent, genetic information or participation in discrimination or 
harassment complaint proceedings;
     Provide for the prompt and fair consideration of 
complaints of discrimination;
     Make reasonable accommodations for qualified applicants 
for employment and employees with physical or mental disabilities under 
law;
     Provide an environment free from harassment to all 
employees;
     Create and maintain an organizational culture that 
recognizes, values, and supports employee and public diversity;
     Implement affirmative programs to carry out this policy; 
and
     Develop objectives within the strategic planning process 
to meet the goals of EEOD.

Affirmative Employment and Diversity

    The FCA intends to be a model employer. That is, as far as 
possible, FCA will build and maintain a workforce that reflects the 
rich diversity of individual differences evident throughout this 
Nation. The Board views individual differences as complementary and 
believes these differences can enrich our organization. When individual 
differences are respected, recognized, and valued, diversity becomes a 
powerful force that can contribute to achieving superior results. 
Therefore, we will create, maintain, and continuously improve on an 
organizational culture that fully recognizes, values, and supports 
employee diversity. The Board is committed to promoting and supporting 
an inclusive environment that provides to all employees, individually 
and collectively, the chance to work to their full potential in the 
pursuit of the Agency's mission. We will provide everyone the 
opportunity to develop to his or her fullest potential. When a barrier 
to someone achieving this goal exists, we will strive to remove this 
barrier.
    The Board expects full cooperation and support from everyone 
associated with recruitment, selection, development, and promotion to 
ensure such actions are free of discrimination. Though staff commitment 
is important, the role of supervisors is paramount to success. Agency 
supervisors must be coaches and are responsible for helping every 
employee to develop their talents and to give their best efforts in 
contributing to the mission of the FCA. Therefore, all supervisors will 
be evaluated on their EEOD achievements as part of their overall job 
performance.

Workplace Harassment

    It is the policy of the FCA to provide a work environment free from 
unlawful discrimination in any form, and to protect all employees, male 
or female, from any form of harassment, either physical or verbal. The 
FCA will not tolerate harassment in the workplace for any reason. The 
FCA also will not tolerate retaliation against any employee for 
reporting harassment or for aiding in any inquiry about reporting 
harassment.

Disabled Veterans Affirmative Action Program (DVAAP)

    A disabled veteran is defined as someone who is entitled to 
compensation under the laws administered by the Veterans Administration 
or someone who was discharged or released from active duty because of a 
service-connected disability.
    The FCA is committed to increasing the representation of disabled 
veterans within its organization. Our Nation owes a debt to those 
veterans who served their country, especially those who were disabled 
because of service. To honor these disabled veterans, the FCA shall 
place emphasis on making vacancies known to and providing opportunities 
for employing disabled veterans.

Responsibilities

    The Chairman and Chief Executive Officer (CEO) is ultimately 
responsible for developing and carrying out all EEOD requirements and 
initiatives in accordance with laws and regulations to fulfill 
diversity initiatives in approved program plans.
    To help in fulfilling these responsibilities the CEO, or designee, 
will select individuals to fill the following positions:
     An EEO Director;
     Special Emphasis Program Managers required by law or 
regulation; and
     EEO Counselors in sufficient number to ensure the needs of 
each Agency office are met.
    Individuals selected for these positions will:
     Perform duties as determined by the CEO, and as formally 
expressed in position descriptions or individual performance rating 
elements, as appropriate;
     Serve on a collateral-duty basis--the CEO will decide the 
percent of time devoted to these collateral duties, which may be 
adjusted over time as circumstances and program requirements dictate;
     Attend appropriate training in the areas they have 
responsibility for; and
     Develop, monitor progress, report on, and periodically 
update program plans in their respective areas of responsibility.
    The CEO or EEO Director may also establish standing committees to 
deal with specific issues as they arise. The Head of each Agency office 
will provide support to the individuals identified above on an as 
needed basis upon request from the EEO Director.

    Dated this 12th day of September, 2002.

    By Order of the Board.

Jeanette C. Brinkley,
Acting Secretary to the Board.

[[Page 71148]]

Rules for the Transaction of Business of the Farm Credit Administration 
Board

FCA-PS-64

    Effective Date: 27-JUN-05.
    Effect on Previous Action: Originally adopted by NV-94-05 (07-FEB-
94)[FCA-PS-58]; corrected by memo 09-FEB-94; amended by NV-95-03 (13-
JAN-95)[FCA-PS-64]; amended by NV-95-18 (20-MAR-95); amended by NV-95-
46 (9-AUG-95); amended by BM-24-OCT-95-02; amended by NV-95-69 (02-JAN-
96). See also 58 FR 6633, Feb. 1, 1993 and 59 FR 17537, Apr. 13, 1994; 
reaffirmed by NV-96-22 (30-MAY-96); amended by NV-96-36 (26-AUG-96); 
amended by NV-98-16 (8-MAY-98); amended by NV-99-09 (16-MAR-99); 
amended by NV-99-25 (24-SEP-99).
    Source of Authority: Sections 5.8, 5.9, 5.10, 5.11 and 5.17 of the 
Farm Credit Act of 1971, as amended.
    The Farm Credit Administration (FCA) Board Hereby Adopts the 
Following Policy Statement:

Rules for the Transaction of Business of the Farm Credit Administration 
Board

Purpose, Scope, and Definitions

    Section 1. Purpose and Scope. These Rules adopted under section 
5.8(c) of the Farm Credit Act of 1971, as amended (Act), concerning the 
transaction of business of the Farm Credit Administration (FCA) Board 
(Board) supplement the statutes and regulations that govern the 
procedures and practice of the Board (including, without limitation, 
the Act, the Sunshine Act, and FCA regulations, 12 CFR 600 et seq.). 
Unless otherwise provided in these Rules, or relevant statutes or 
regulations, this Board will transact its business in accordance with 
Robert's Rules of Order (Newly Revised) (10th Edition).
    Section 2. Definitions, Reporting Relationships, and Performance 
Appraisals.
     ``Act'' means the Farm Credit Act of 1971, as amended.
     ``Board Member'' means each of the three individuals 
appointed by the President, by and with the advice and consent of the 
Senate, to serve as Members of the Board, including the Chairman, 
unless the context requires otherwise. Each Board Member appraises the 
performance of his or her staff.
     ``Chairman'' means the Board Member designated by the 
President to serve as Chairman of the Board. The Chairman also serves 
as the Agency's Chief Executive Officer (CEO) and is designated by the 
Director of the Office of Management and Budget to serve as Head of the 
Agency. After consultation with the other Board Members, the Chairman 
appraises the performance of the Secretary, Inspector General, EEO 
Director, Designated Agency Ethics Official, Senior Agency Official, 
and all Office Directors reporting directly to him or her.
     ``Designated Agency Ethics Official'' means an employee of 
the FCA designated by the Head of the Agency to administer the 
provisions of Title I of the Ethics in Government Act of 1978, to 
coordinate and manage the Agency's ethics program, and to provide 
liaison with the Office of Government Ethics on all aspects of FCA's 
ethics program. The DAEO reports directly to the Chairman on the 
Agency's ethics program.
     ``Equal Employment Opportunity (EEO) Director'' means an 
employee of the FCA designated by the Head of the Agency to administer 
the provisions of the Agency's EEO program as set forth in 29 CFR Part 
1614.
     ``General Counsel'' means an employee of the FCA who 
serves as the chief legal officer of the Board. The General Counsel 
reports to the Chairman concerning administrative matters and to the 
FCA Board on matters of Agency policy. By the nature of the position 
the General Counsel, as appropriate and necessary, maintains special 
advisory relationships in confidence with the individual Board Members. 
The General Counsel must also keep the FCA Board fully informed of all 
litigation in which the Agency is involved.
     ``Office Director'' means an employee of the FCA serving 
as head of an FCA Office, excluding the Inspector General unless 
specified.
     ``Secretary'' means an employee of the FCA who serves as 
Secretary to the Board as appointed by the Chairman. The Secretary, or 
another FCA employee designated by the Chairman, serves as the 
parliamentarian for the Board. The Secretary keeps permanent and 
complete records and minutes of the acts and proceedings of the Board.
     ``Senior Agency Official'' means an employee of the FCA in 
a senior position other than Office Director, such as a Chief of Staff 
or Chief Operating Officer. The Senior Agency Official appraises the 
performance of staff that report directly to him or her. The Chairman, 
in consultation with the other Board Members, reviews the performance 
appraisals conducted by the Senior Agency Official.
     ``Sunshine Act'' means the Government in the Sunshine Act, 
5 U.S.C. 552b.

Amendments

    Section 1. The business of the Board will be transacted in 
accordance with these Rules, which may be amended from time to time: 
Provided, however, that upon agreement of at least two Board Members 
convened in a duly called meeting, the Rules may be waived in any 
particular instance, except that action may be taken on items at a 
Special Meeting only in accordance with Part I, Article I, Sec.  3(b) 
of this policy.
    Section 2. These Rules may be changed or amended by the concurring 
vote of at least two Board Members upon notice of the proposed change 
or amendments having been given at least thirty days before such vote.
    Section 3. These Rules will be reviewed by the Board at least every 
five years or as needed.

Part I--Rules for the FCA Board Meetings

Article I. Board Meetings.
Article II. Board Action.
Article III. Board and Chairman Delegations.

Article I

Board Meetings

    Section 1. Sunshine Act. All FCA Board meetings will be announced 
and conducted in conformance with the Government in Sunshine Act.
    Section 2. Presiding Officer. The Chairman will preside at each 
meeting. In the event the Chairman is unavailable, the other Board 
Member from the Chairman's political party will preside. If there is no 
other Board Member from the Chairman's political party, then the Board 
Member serving the longest on the Board will preside.
    Section 3. Calls and Agenda.
    (a) Regular Meeting. The Secretary, at the direction of the 
Chairman, issues a call for items for the agenda to the other Board 
Members and the Office Directors of FCA. The Secretary provides to the 
Chairman a list of all the items submitted, including a list of 
outstanding notational votes and matters voted ``not appropriate for 
notational vote.'' The Chairman then establishes the agenda to be 
published in the Federal Register at least one week before the meeting 
date. At each meeting, the Board votes to approve or amend the agenda 
established by the Chairman. The Board may amend the agenda to add 
items that the Board Members believe need to be considered at that 
meeting.
    (b) Special Meeting. Special meetings of the Board may be called:
    (1) By the Chairman; or
    (2) By the other two Board Members; or

[[Page 71149]]

    (3) If there is at the time a vacancy on the Board, by a single 
Board Member.
    Any call for a Special Meeting will specify the business to be 
transacted and state the place and time of such meeting. No business 
will be brought before a Special Meeting that has not been specified in 
the notice of call of such meeting without the unanimous consent of all 
Board Members.
    (c) Notice. The Secretary will give appropriate notice of any and 
all meetings and make the call for Special meetings. Reasonable efforts 
to provide such notice to Board Members will be made for all meetings 
of the Board, but failure of notice will in no case invalidate a 
meeting or any action taken during that meeting.
    Section 4. Board Materials. The Secretary will distribute complete 
Board Briefing Books to each Board Member at least two full business 
days before any Regular Meeting. Unless agreed to by all Board Members, 
no vote may be taken on an issue unless the necessary material has been 
provided to the Board Members not less than twenty-four hours before 
the meeting to consider such issue.
    Section 5. Supporting Documentation. The Secretary will maintain 
one copy of all Board Briefing Book material. All copies of the Board 
Briefing Book material for Closed Sessions provided to anyone other 
than the Secretary will be returned to the Secretary for disposal or 
maintained in a secure location approved by the Secretary. One copy of 
each Executive Summary provided to a Board Member will be provided to 
and maintained by the Secretary. Board Briefing Books and Executive 
Summaries are not part of the minutes of the Board unless expressly 
incorporated therein.
    Section 6. Telephone Conference. Any Board Member, including the 
Chairman, may participate in a meeting of the Board through the use of 
conference call telephone or similar equipment, provided that all 
persons participating in the meeting can simultaneously speak to and 
hear each other. Any Board Member so participating will be deemed 
present at the meeting for all purposes.
    Section 7. Public Attendance.
    (a) Attendance. Members of the public may attend all meetings of 
the Board except those meetings or portions of meetings that are closed 
as directed by the Board, consistent with the Sunshine Act.
    (b) Public Appearances Before the Board. While members of the 
public are invited and encouraged to attend Board meetings, no member 
of the public has a right to speak in a Board meeting. However, the 
Board may, in its sole discretion, permit a member of the public to 
address the Board if he or she provides a written request and statement 
covering the intended subject matter at least fifteen days before the 
meeting.
    Section 8. Minutes.
    (a) Format. The format of minutes of the Board meetings, unless 
otherwise stated in these rules or relevant statutes or regulations, 
will comply with Robert's Rules of Order (Newly Revised) (10th Edition) 
and the Sunshine Act. The minutes will clearly identify the date, time, 
and place of the meeting, the type of meeting held, whether the meeting 
was open or closed, the identity of Board Members present and, where 
applicable, that they participated by telephone, and the identity of 
the Secretary and the General Counsel in attendance, or, in their 
absence, the names of the persons who substituted for them. The minutes 
will contain a separate paragraph for each subject matter, and will 
note all main motions or motions to bring a main motion before the 
assembly, except any that were withdrawn. The minutes will not contain 
any reference to statements made unless a request is specifically made 
that a statement be made a part of the record, or if required by the 
Sunshine Act. The minutes of meetings will indicate the substance and 
disposition of any notational votes completed since the last meeting. 
Except in the case of a voice vote, the Secretary will record the vote 
of each Board Member on a question or will note a unanimous consent. 
The Chairman and the Secretary will sign the minutes of the Board, 
indicating the date of approval by the Board.
    (b) Circulation. The Chairman and General Counsel will review draft 
minutes. The Secretary will circulate draft minutes to all Board 
Members one week before their consideration at a Board Meeting. The 
Secretary will place in all Board Briefing Books copies of the minutes 
of the meetings of the Board (Open Session) to be voted on at a Board 
Meeting. The Secretary will place only in the Board Briefing Books of 
the Board Members, the Secretary, and the General Counsel copies of the 
minutes of the meetings of the Board (Closed Session) to be voted on at 
a Board Meeting.

Article II

Board Action

    Section 1. Affirmative Vote Required. Action on any matter requires 
the affirmative vote of at least two Board Members, except as provided 
in Article III, Sec.  1 of this Part.
    Section 2. Records of Board Action.
    (a) Meetings. The vote of each Board Member, including the 
Chairman, on a question voted on at a meeting will be recorded in the 
minutes. The Chairman may, if there is no objection, call for a voice 
vote on adjournment or other actions. If a voice vote is taken, its 
result will be recorded in the minutes.
    (b) Notational Votes. The Secretary will provide a summary of any 
action taken by notational vote to the Board Members and Chairman and 
the action taken will be reflected in the minutes of the next meeting 
of the Board.
    Section 3. Notational Voting.
    (a) Nothing in these Rules precludes the transaction of business by 
the circulation of written items (notational votes) to the Board 
Members.
    (b) The Board may use notational voting procedures to decide any 
matter that may come before it. Any Board Member may submit a motion to 
the Secretary for distribution as a notational vote. However, in view 
of the public policy of openness reflected in the Sunshine Act and the 
desire to allow any Board Member to present viewpoints to the other 
Board Members, any Board Member can veto the use of the notational 
voting procedure for the consideration of any particular matter by 
voting ``not appropriate for notational vote.''
    (c) Upon submission of an item for notational vote, the Secretary 
will provide each Board Member a complete package of all relevant 
information and a notational vote ballot specifying the Board Member 
making the motion, the motion itself, and the deadline for return of 
the ballot. Within ten business days of receipt, or earlier if the 
motion requires, each Board Member will act on the matter by returning 
the ballot to the Secretary. Each Board Member is to indicate his/her 
position in writing on the ballot in the following manner: (1) Approve; 
(2) disapprove; (3) abstain; or (4) not appropriate for notational 
vote.
    (d) No partial concurrences or amendments are permitted; however, a 
Board Member may suggest a revision to the proponent of the motion, 
subject to compliance with the Sunshine Act, and the proponent may 
withdraw his motion at any time before receipt by the Secretary of all 
the ballots of all Board Members or the end of the time period provided 
for on the ballot.
    (e) A Board Member who is absent from the office may authorize a 
staff member to initial the ballot for him/her, provided that the Board 
Member has a designation memorandum on file with the Secretary.
    Section 4. Board Records. The Secretary will maintain the records 
of the Board including, without limitation,

[[Page 71150]]

the minutes of the Board meetings and notational votes.

Article III

Board and Chairman Delegations

    Section 1. Two Vacancies/Authority to Act. In the event two Board 
Members are not available by reason of refusal, resignation, temporary 
or permanent incapacitation, or death, to perform the duties of their 
offices, the Board hereby delegates to the remaining Board Member the 
authority to exercise, in his/her discretion, the authorities of the 
FCA granted to the Agency or the Board by statute, regulation or 
otherwise, except those authorities which are nondelegable. This 
delegation of authority does not include authority to establish general 
policy and promulgate rules and regulations, or any delegation 
expressly prohibited by statute. This delegation will include but is 
not limited to the exercise of the following powers:
    (a) The approval of actions of the Farm Credit System (System) 
institutions that are required by statute, regulations or otherwise to 
be approved by the FCA or its Board;
    (b) The exercise of all powers of enforcement granted to the FCA by 
statute, including but not limited to, the authorities contained in 12 
U.S.C. 2154, 2154a, 2183, 2202a, and 2261-2274; and
    (c) Any actions or approvals required in connection with the 
conduct of a receivership or conservatorship of a System institution.
    Authorities delegated by this Section may be redelegated, in 
writing, at the discretion of the remaining Board Member, to other FCA 
officers or employees.
    Section 2. National Security Emergencies. Pursuant to Executive 
Order 12656, as amended, in the event of a national security emergency, 
if the Chairman is unable to perform his or her duties for any reason, 
the Chairman, at his or her sole discretion, delegates to the following 
individuals, in the order mentioned and subject to being available, the 
authority to exercise and perform all the functions, powers, authority 
and duties of the Chairman in an acting capacity until such time as 
either the Chairman can resume his/her position or, if no longer able 
to serve as Chairman, the President of the United States designates a 
new Chairman:
    (a) Member of the Board of the Chairman's political party;
    (b) If there is no other Board Member from the Chairman's political 
party, then the Board Member serving the longest on the Board;
    (c) General Counsel.
    The Chairman or Acting Chairman will ensure that FCA has an 
alternative location for its headquarters functions in the event a 
national security emergency renders FCA's headquarters inoperative. The 
Chairman or Acting Chairman may establish such branch office or offices 
of the FCA as are necessary to coordinate its operations with those of 
other government agencies.
    Section 3. Individual Assignments. To the extent consistent with 
law, the Board or the Chairman may offer another Member of the Board a 
special assignment and define the duties incident thereto, and the 
Chairman may delegate to another Board Member certain duties and 
responsibilities of the Chairman.
    Section 4. Other Delegations. The FCA Board may delegate such 
authorities as it deems necessary and appropriate. Such delegations are 
included in Attachments A and B to this policy.

Part II--Board and Staff Governance

Article I. Board Governance.
Article II. Staff Governance.

Article I

Board Governance

    Section 1. General. The purpose of this Part is to ensure the 
efficient operation of the FCA in light of the various authorities and 
operational responsibilities of Board and the FCA Chairman and CEO.
    The Board recognizes that for the Agency to run efficiently, the 
Chairman/CEO must have sufficient latitude and discretion to direct the 
implementation of Board policies and run the Agency's day-to-day 
affairs. Notwithstanding such latitude, the other Board Members must 
have access to staff and must be able to request information from staff 
that they find necessary to fulfill their policy- and rulemaking 
responsibilities under the Act.
    The Chairman/CEO is always free to bring to the Board issues that 
do not require Board action. Conversely, the Board may involve itself 
in operational matters ordinarily reserved for the Chairman/CEO if it 
concludes that they rise to the level of policy due to their 
sensitivity, seriousness, or controversial nature.
    Section 2. Board Authorities. The Board, acting as a unit, must 
manage, administer, and establish policies for the FCA. The Board 
specifically approves the rules and regulations implementing the Act; 
provides for the examination, enforcement, and regulation of System 
institutions; provides for the performance of all the powers, 
functions, and duties vested in the FCA; and requires any reports 
deemed necessary from System institutions. The Board also adopts the 
FCA seal. Each Board Member has the authority to appoint and direct 
regular, full-time staff in his or her immediate office.
    Section 3. Chairman Authorities. The Chairman, in carrying out his 
or her responsibilities, is governed by the general policies adopted by 
the Board and by such regulatory decisions, findings, and policy 
determinations as the Board may by law be authorized to make.
    The Chairman, in carrying out policies as directed by the Board, 
acts as spokesperson for the Board and represents the Board and the FCA 
in official relations within the Federal Government. Under policies 
adopted by the Board, the Chairman must consult on a regular basis with 
the Secretary of the Treasury concerning the exercise of the System's 
powers under section 4.2 of the Act; the Board of Governors of the 
Federal Reserve System concerning the effect of System lending 
activities on national monetary policy; and the Secretary of 
Agriculture concerning the effect of System policies on farmer, 
ranchers, and the agricultural economy. As to third persons, all acts 
of the Chairman will be conclusively presumed to be in compliance with 
general policies and regulatory decisions, findings, and determinations 
of the Board.
    The Chairman enforces the rules, regulations, and orders of the 
Board. The Chairman designates attorneys to represent the Agency in any 
civil proceeding or civil action brought in connection with the 
administration of conservatorships and receiverships and in civil 
proceedings or civil actions when so authorized by the Attorney General 
under provisions of title 28 of the United States Code. The Chairman, 
subject to the approval of the Board, may establish one or more 
advisory committees in accordance with the Federal Advisory Committee 
Act.
    The Chairman may not delegate any of the foregoing powers without 
prior Board approval.
    The Chairman also exercises those powers conferred on the Head of 
the Agency, including the power to make certain designations.
    Section 4. CEO Authorities. The Chairman of the FCA Board is also 
the Agency's CEO. The CEO, in carrying out his or her responsibilities, 
directs the implementation of policies and regulations adopted by the 
Board and, after consultation with the Board,

[[Page 71151]]

executes the administrative functions and duties of the FCA.
    ``Consultation with the Board'' is achieved when the Chairman/CEO 
makes a good faith attempt to seek advice, guidance, and input from the 
Board before taking significant action on matters related to the 
execution of administrative functions or duties.
    The Chairman as CEO runs the day-to-day operations of the Agency. 
This includes the power to implement the policies and regulations 
adopted by the Board; appoint personnel as necessary to carry out 
Agency functions; set staff pay and benefits; and direct staff. As 
provided in section 5.11(b) of the Act, the Chairman/CEO appoints heads 
of major administrative divisions subject to the approval of the Board.
    The Chairman as CEO may designate to other FCA officers and 
employees the authority to exercise and perform those powers necessary 
for the day-to-day management of the Agency.

Article II

Staff Governance

    Section 1. Authority over Staff. The Chairman/CEO has authority to 
hire the personnel necessary to carry out the mission of the Agency and 
to direct staff, except that each Board Member is entitled to appoint 
and direct his or her regular, full-time staff within the constraints 
of the adopted budget for the Office of the Board.
    Subject to the approval of the Board, the Chairman/CEO appoints and 
removes the ``heads of major administrative divisions.'' The Board 
defines the ``heads of major administrative divisions'' as all Office 
Directors who are career appointees. The Board must approve the 
conversion of an existing career position to a noncareer (political) 
position.
    Section 2. Organization Chart. Consistent with its mandate to 
approve regulations and appointments outlined above, the Board approves 
the FCA organizational chart down through the Office level along with 
relevant functional statements for each Office. Authority to make 
organizational changes within any division rests with the Chairman/CEO, 
and may be delegated to the Senior Agency Official or Office Directors.

Part III--Board Operations

Article I. Committee and Financial Operations, and Other Activities.
Article II. Board Member Travel and Related Expenses.

Article I

Committee and Financial Operations, and Other Activities

    Section 1. Committee Operations. To assist the Board in exercising 
its authority for oversight and approval of the Strategic Plan, the 
formulation of regulations and policy, and the monitoring and 
assessment of risk, the Board directs the formation of three 
committees.
    Each Committee Chair will be designated by the Chairman. Each 
committee will be comprised of the Board Members' Executive Assistants 
and such Agency staff as determined by the Committee Chair. The 
Committee Chair will designate a Coordinator with expertise in, or 
significant accountability for, the activities of the committee. 
Committees will meet as often as determined by the Committee Chair to 
achieve committee objectives. The Chairman may also approve the use of 
external consultants to assist the committees on an as-needed basis.
    (a) Strategic Planning Committee. The objective of this committee 
is to provide a forum for Board input on (1) the development of, and 
periodic updates to, the Strategic Plan, and (2) changes in processes 
and procedures that will improve the quality of this key Agency 
document.
    (b) Regulation and Policy Development Committee. The objective of 
this committee is to provide a forum to (1) Obtain Board input 
throughout the entire process of developing, modifying, or eliminating 
individual regulations, (2) discuss changes in processes and procedures 
that will improve the Agency's regulation and policy development 
process, and (3) foster open discussion during the development and 
periodic update of the Agency's regulatory agenda.
    (c) Risk Committee. The objective of this committee is to provide a 
forum to (1) Facilitate Board awareness of risks to the ongoing mission 
fulfillment and safety and soundness of the System and Farmer Mac, (2) 
ensure an integrated and coordinated Agency risk analysis process that 
effectively uses information from a wide variety of internal and 
external sources, and (3) foster open discussion about risks to the 
System and Farmer Mac and the implications of such risks for future 
Agency operations.
    Section 2. Financial Operations.
    (a) Budget Approval. The Chairman, consistent with the provisions 
of the Act, other law and regulations, and applicable policy, oversees 
the development of budget proposals and causes the expenditure of funds 
within approved budgets to meet the Agency's mission and objectives. 
The Board approves an object class budget for the Agency as a whole and 
a budget for each office. Any reallocation of funds in excess of 
$100,000 requires FCA Board approval. Reallocation of funds of $100,000 
or less requires the Chairman's approval (or that of the Chairman's 
designee). The objective of single procurements and the provision of 
services or materials in excess of $100,000 will be made during the 
budget approval process. The Chief Financial Officer will report 
monthly on all budgetary reallocations that occur after the FCA Board 
approves a fiscal year budget.
    Section 3. Other Board Operations.
    (a) Audit Resolution Process. The Chairman is responsible for 
overseeing the audit resolution process and, through a designee, for 
audit resolution implementation and follow-up. However, the Chairman 
must obtain Board approval of audit resolutions where the issue would 
normally require Board action. The Inspector General and Audit Follow-
up Official will report to the Board the status of any unresolved audit 
recommendations, unimplemented management decisions, and other issues 
on a semiannual basis following the Inspector General's Semi-Annual 
Report to Congress.
    (b) Litigation. The Chairman has authority to undertake litigation 
to defend the Agency, consistent with established Board policy. The 
Board will approve litigation where the Agency is plaintiff, will 
approve recommendations to the Justice Department to pursue an appeal, 
and will approve positions advanced in litigation that conflict with 
existing Board policy or establish a significant new policy. The 
Chairman's authority to settle certain claims against the Agency have 
been delegated to the General Counsel (GC) provided the GC consults 
with the Chairman.
    (c) Documents and Communications.
    (1) Approval, Review, and Consultation. The FCA Board is 
responsible for determining the Agency's posi