[Code of Federal Regulations]
[Title 7, Volume 10]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1427.15]

[Page 491-492]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER XIV--COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
 
PART 1427_COTTON--Table of Contents
 
     Subpart A_Nonrecourse Cotton Loan and Loan Deficiency Payments
 
Sec.  1427.15  Special procedure where funds are advanced.

    (a) This special procedure is provided to assist persons or firms 
which, in the course of their regular business of handling cotton for 
producers, have made advances to eligible producers on cotton eligible 
to be pledged as collateral for a marketing assistance loan or to 
receive a loan deficiency payment. A person, firm, or financial 
institution which has made advances to eligible producers on eligible 
cotton may also obtain reimbursement for the amounts advanced under this 
procedure.
    (b) This special procedure shall apply only:
    (1) If such person or firm is entitled to reimbursement from the 
proceeds of the marketing assistance loans or loan deficiency payments 
for the amounts advanced and has been authorized by the producer to 
deliver the loan or loan deficiency payment documents to a county office 
for disbursement of the loans or loan deficiency payments; and
    (2) To marketing assistance loan or loan deficiency payment 
documents covering cotton on which a person or firm has advanced to the 
producers, including payments to prior lienholders and other creditors, 
the note amounts shown on the Form A loan documents, except for:
    (i) Authorized cotton clerk fees;

[[Page 492]]

    (ii) The research and promotion fee to be collected for transmission 
to the Cotton Board by CCC; and
    (iii) CCC loan service charges.
    (c)(1) All marketing assistance loan or loan deficiency payment 
documents shall be mailed or delivered to the appropriate county office 
and shall show the entire proceeds of the marketing assistance loans or 
loan deficiency payments, except for CCC loan service charges and 
research and promotion fees, for disbursement to:
    (i) The financial institution which is to allow credit to the person 
or firm which made the loan or loan deficiency payment advances or to 
such financial institution and such person or firm as joint payees; or
    (ii) The person, firm, or financial institution which made the 
marketing assistance loan or loan deficiency payment advances to the 
producers.
    (2) The documents shall be accompanied by a Transmittal Schedule of 
Loan and Loan Deficiency Payment Documents (Transmittal) on a form 
prescribed by CCC, in original and two copies, numbered serially for 
each county office by the person, firm, or financial institution which 
made the marketing assistance loan or loan deficiency payment advance. 
The Transmittal shall show the amounts invested by the person, firm, or 
financial institution in the marketing assistance loans or loan 
deficiency payments.
    (3) Upon receipt of the marketing assistance loan or loan deficiency 
payment documents and Transmittal, the county office will stamp one copy 
of the Transmittal to indicate receipt of the documents and return this 
copy to the person, firm, or financial institution.
    (d) The person, firm, or financial institution shall be deemed to 
have invested funds in the loans or loan deficiency payment as of the 
date marketing assistance loan or loan deficiency payment documents 
acceptable to CCC were delivered to a county office or, if received by 
mail, the date of mailing as indicated by postmark or the date of 
receipt in a county office if no postmark date is shown. Patron postage 
meter date stamp will not be recognized as a postmark date.
    (e) Interest will be computed on the total amount invested by the 
person, firm, or financial institution in the marketing assistance loan 
or loan deficiency payment represented by accepted documents from and 
including the date of investment of funds by the person, firm, or 
financial institution to, but not including, the date of disbursement by 
CCC.
    (1) Interest will be paid at the rate in effect for CCC loans as 
provided in part 1405 of this chapter.
    (2) Interest earned by the person, firm, or financial institution on 
the investment in loans disbursed during a month will be paid by CCC 
after the end of the month.