AN ACT Relating to agricultural assistance; adding a new chapter to Title 7 RCW; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that the agricultural sector of the state's economy is under severe financial stress due to low farm commodity prices, continuing high interest rates, and reduced net farm income. It is the declared purpose of this chapter to establish an emergency program which will serve and promote the public welfare of the state of Washington by assuring the viability of farm operations, preventing erosion of the tax base in rural areas, reducing foreclosures on farm property, and enhancing the financial stability of the agricultural industry.

NEW SECTION. Sec. 2. As used in this chapter, unless the context indicates otherwise, the following definitions apply:

(1) "Agricultural production" means the production of livestock, poultry, field crops, fruit, or other animal and vegetable matter for food or fiber.

(2) "Agricultural property" means:

(a) Real property that is principally used for agricultural production; and

(b) Personal property that is part of an agricultural production operation, including equipment, or used as security to finance such an operation.

(3) "College board" means the state board for community college education.

(4) "College" means the community college offering a program of financial consulting in closest proximity to the distressed farmer who applies for assistance under section 8 of this act.

(5) "Farmer" means a person who owns or operates a farm or ranch primarily for the purpose of agricultural production.

(6) "Mediator" means a person who has been trained under section 5 of this act in mediation and negotiation techniques, to serve as a negotiator between a farmer and a creditor as authorized under section 8 of this act.

(7) "Financial consultant" means a person who is or has been involved in production agriculture and who has been trained under section 5 of this act in financial planning and peer counseling.

(8) "Mediation process" means the agricultural assistance and consultation program provided for in section 3 of this act.

(9) "Creditor" means:

(a) The holder of a mortgage on agricultural property;

(b) A vendor of a contract for deed of agricultural property;

(d) A judgment creditor with a judgment against a debtor engaged in agricultural production; or

(e) A person who extends credit without perfected security interest to a farmer for the purchase of goods or services used in agricultural production.

NEW SECTION. Sec. 3. (1) The state board for community college education through the community college system shall establish an agricultural assistance and consultation program to aid financially distressed farmers in this state.

(2) The college board shall take reasonable measures to inform agricultural lenders and borrowers of this program.

(3) The college shall submit a mediation process, to be established at that college, to the college board for approval. As part of the mediation process, the college shall make available to farmers the following types of assistance:

(a) Financial consulting, farm management consulting, and voluntary debt mediation as provided for in section 8 of this act; and

(b) Referral services for mental health assistance and support counseling.

NEW SECTION. Sec. 4. For the purpose of establishing the program, the college may:

(1) Utilize the services of:

(a) A network of trained peer counselors who can directly assist financially distressed farmers;

(b) The cooperative extension service and the college of agriculture at Washington State University;

(d) Legal service corporations, the University of Washington law school, or private law firms;

(e) Community service organizations;

(f) Private business;

(g) Professional associations;

(h) Regional mental health corporations;

(i) Volunteer organizations; and

(j) Any other person or entity.

(2) Contract for services with qualified personnel, including peer counselors, farm management specialists, accountants, attorneys, and mental health professionals, to provide the assistance required under section 3 of this act.

NEW SECTION. Sec. 5. For the purpose of administering the program, the college board shall:

(1) Provide training for financial consultants and mediators who are to provide services under this chapter; and

(2) Compile a directory of services available through the program.

NEW SECTION. Sec. 6. The college board may accept monetary or in-kind contributions, gifts, and grants provided to support the program.

NEW SECTION. Sec. 7. The college board may establish reasonable fees to defray the cost of providing financial consulting services under this chapter. The college board shall apply to the United States secretary of agriculture for a matching grant for this program under Title V, subtitle A of the agricultural credit act of 1987.

NEW SECTION. Sec. 8. (1) A farmer who is in danger of foreclosure on agricultural property may apply for entrance into the mediation process by filing an application with the college on a form prescribed by the college board.

(2) A farmer who participates in the mediation process shall authorize the release to the college of any information held by a creditor.

(3) Upon receipt of a properly completed application into the mediation process, the college may assign the farmer to a financial consultant. If this action relieves the financially distressed situation, mediation shall not be sought.

(4) If, upon completion of the financial consulting program, mediation is desired and recommended by the financial consultant, the college shall direct a mediator to meet with the farmer and creditor to assist in mediation. For purposes of this section, a financial consultant may also act as mediator if trained under section 5 of this act.

(5) Subject to the provisions of subsection (6) of this section, the college shall immediately terminate an attempt at mediation if at any time it finds that a creditor does not agree to participate in mediation.

(6) If mediation involves more than one creditor and any one creditor does not agree to participate in mediation, the college shall terminate mediation only insofar as it relates to that creditor.

NEW SECTION. Sec. 9. (1) If an agreement is reached between the farmer and a creditor, the mediator shall draft a written mediation agreement to be signed by the farmer and the creditor.

(2) A farmer and any creditor who are parties to a mediation agreement:

(a) Are bound by the terms of the agreement;

(b) May enforce the mediation agreement as a legal contract; and

NEW SECTION. Sec. 10. If a mediation agreement cannot be reached, the mediator shall recommend to the college that the mediation be concluded and mediation terminated.

NEW SECTION. Sec. 11. (1) All materials, data, and information received by the college with respect to any request filed under section 8 of this act are confidential and are not subject to examination or disclosure as public information.

(2) No official, employee, or agent of the college may knowingly disclose any materials, data, or information concerning a mediation request without the consent of the farmer and the creditor.

NEW SECTION. Sec. 12. Meetings between a farmer and any creditor conducted by a mediator are confidential and are not subject to the provisions of the open meeting law.

NEW SECTION. Sec. 13. All parties who voluntarily enter into the mediation process as described in this chapter shall waive their right to take civil action against the state of Washington and the designated financial consultant and mediator and thereby release the state and the designated financial consultant and mediator from any civil liability which may result from such activities.

NEW SECTION. Sec. 14. This program shall cease to exist April 1, 1991, unless extended by law for an additional fixed period of time.

NEW SECTION. Sec. 15. Sections 1 through 14 of this act shall constitute a new chapter in Title 7 RCW.

NEW SECTION. Sec. 16. This act is necessary for the immediate preservation of the public peace, health, and safety, the support of the state government and its existing public institutions, and shall take effect immediately.