A federal magistrate has recommended that a contempt citation be brought against Agriculture Secretary Richard Lyng for failing to fully obey a court order barring the USDA from calling in crop-storage loans. Magistrate Janice Symchych made the recommendation Tuesday to U.S. District Judge Harry MacLaughlin, who had issued a preliminary injunction July 21 against the Agriculture Department's loan-cancellation plan. Lyng has 10 days from Tuesday in which to file objections to the contempt recommendation. According to the Minnesota attorney general's office, which is a party to the suit against the USDA, the department did not comply with the injunction until July 29, when it announced that certain loans could be extended until Aug. 31. The announcement came after many farmers already had settled their loans with the USDA, the attorney general's office said. Symchych recommended all loans due and payable after July 22 be extended. For loans that matured on July 31 and were settled by farmers before any extensions were available, Symchych recommended that USDA restore those farmers to the position they would have been in had the federal agency obeyed the injunction. ``The court cannot allow defendants (USDA) to circumvent the purpose of the injunction by simply employing new tactics or strategies which achieve the same unlawful result,'' Symchych said in a report. The federal reserve program allows farmers to hold surplus grains off the market while receiving government price supports and storage fees. In effect, the grain is collateral for the loans. Because the drought has tightened grain supplies, the Agriculture Department is calling the loans in order to force the farmers to sell the grain. In addition to the contempt citation, Symchych recommended the USDA be fined $1,000 for each loan it canceled after MacLaughlin's injunction went into effect. Symchych also recommended the USDA be given until Sept. 30 to comply with the order. Lyng was on vacation and unavailable for comment, USDA spokesman Dave Lane said Wednesday. Richard W. Goldberg, acting undersecretary for international affairs and commodity programs for the USDA, said he would not comment on the matter because it is under litigation. Attorney General Hubert H. Humphrey III brought the suit against the department on behalf of Agriculture Commissioner Jim Nichols and seven Minnesota farmers. He contended that the Agriculture Department failed to go through the formal government rule-making procedures before it decided to stop extending the loans. The USDA, meanwhile, announced Tuesday that it would stop extending crop loans as of Wednesday, irrespective of MacLaughlin's injunction. The announcement came before Symchych's recommendation was issued. Humphrey and Nichols were expected to seek a court hearing this week to halt implementation of the USDA's new plan.
