[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: 7CFR1436.15]

[Page 587]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER XIV--COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
 
PART 1436_FARM STORAGE FACILITY LOAN PROGRAM REGULATIONS--Table of Contents
 
Sec.  1436.15  Maintenance, liability, insurance, and inspections.

    (a) The borrower must maintain the loan collateral in a condition 
suitable for the storage of one or more of the facility loan 
commodities. For purpose of this section the term ``loan collateral'' 
shall mean any property of any kind that was built or improved, or 
acquired using a loan made under this part.
    (b) Until the loan has been repaid, the borrower shall be liable for 
all damages to or destruction of the loan collateral. CCC shall not 
assume any loss of the loan collateral.
    (c) CCC may conduct annual collateral inspections to insure 
compliance with this part. The borrower must consent to such inspection 
as a term of the loan and failure to supply such access shall put the 
borrower into default.
    (d) Structures must be insured against all perils in all cases and 
must also be insured against flooding if the structure is located in a 
flood plain, as determined by CCC. Proof of flood insurance, if 
required, and proof of all peril structural insurance, must be provided 
to CCC annually. CCC must be listed as a loss payee on all peril and 
flood insurance policies.
    (e) CCC shall have rights of ingress and egress where the facility 
is located. Failure of the borrower to secure such access will render a 
borrower ineligible for the loan and, if a loan has already been made 
shall constitute a loan default for which the remaining balance of the 
loan shall become immediately due and payable.
    (f) For sugar-related loans, in addition to the requirements of 
paragraph (d) of this section, sugar processors shall also insure the 
contents of storage structures used as collateral for a sugar-related 
facility loan against all perils.

[66 FR 4612, Jan. 18, 2001, as amended at 67 FR 54939, Aug. 26, 2002]