FCS Financial: One Hundred Years July 2016 | Page 6

FCS Financial: One Hundred Years

T

he history of FCS Financial is a story of how the organization and the
farmers they serve have worked together over the past century to create
opportunities for the farmers who feed America. The creation of the
Farm Credit System in 1908 was first put in motion when President Theodore
Roosevelt formed the Commission on Country Life to improve the quality of
life and productivity of rural America, the segment he called the “backbone of
our nation’s efficiency.” The commission recommended a cooperative system for
providing agricultural credit on “fair terms” to help American farmers who were
still laboring with the same hand tools, oxen, and mules as they had for centuries.
In 1913, President Woodrow Wilson signed the Federal Reserve Act, which
included farm real estate loans, but the ultimate goal was reached when on
July 17, 1916, the Sixty-Fourth Congress passed the Federal Farm Loan Act. The
act created twelve land banks to serve twelve districts across the country. Loans
were to be made through federally chartered National Farm Loan Associations
which, as cooperatives, would be organized by farmers and owned and controlled
by them. As a cooperative system, borrowers became members of the local
associations by purchasing stock on the basis of “five per centum of the face of the
desired loan.” Borrower-members could then participate in association affairs as a
voting stockholder, elect association directors, were qualified to receive declared
dividends on stock, and became limited guarantors on the obligations of their
fellow members.
President Woodrow Wilson signed the Federal Farm Loan Act on July 17, 1916.

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