IN THE UNITED STATES BANKRUPTCY COURT  FOR THE SOUTHERN DISTRICT OF IOWA      William Howard Topp            Case No. 20-01191-als12    Debtor(s)      MEMORANDUM OF DECISION  (date entered on docket: September 16, 2021)  Before the Court is an objection by Farm Credit Services to the interest rate proposed by  the Debtor William Topp (hereinafter “Topp”) in his chapter 12 plan. Hearing on this matter was conducted on June 22, 2021 and post-trial briefs have been submitted. Jurisdiction of this matter is conferred pursuant to 28 U.S.C. sections 157(b)(1) and 1334. For the reasons that follow the objection is overruled.  DISCUSSION  Farm Credit Services’ (hereinafter “Farm Credit”) amended proof of claim reflects that it  holds a debt in the amount of $595,538.53, which is secured by real estate valued at $1,447,000.1 Topp’s proposed plan repays this obligation over a term of 20 years with interest at 3%2 and has Farm Credit retaining its lien. Farm Credit objects to the stated interest rate and suggests that 5.25% is appropriate.3 Because Farm Credit does not accept its treatment the bankruptcy code requires that “the value, as of the effective date of the plan, of property to be distributed by the trustee or the debtor under the plan on account of such claim is not less than the allowed amount of such claim.”11 U.S.C. §1225(a)(5)(B)(ii). Accordingly, to confirm Topp’s proposed plan Farm Credit must receive the “present value” of its secured claim. Central to the issue of determining the present value of the secured claim is applying the appropriate interest rate under the plan.U.S. v. Doud,869 F.2d 1144 (8th Cir. 1989);aff’g.In re Doud,74 B.R. 685 (1987);Till v. SCS Credit Corp.,541 U.S. 465 (2004). Topp contends theDoudrate has consistently been used in this District and therefore applies here.Doud, 869 F.2d 1144. Farm Credit counters that    1  Farm Credit’s secured claim includes 5 separate notes (and amendments thereto) with interest rates ranging from  3.5% to 7.60% and various repayment periods ranging from 10 to 20 years.  2  The court presumes that this calculation is based upon the 20-year bond rate on June 21, 2021 at 1.87% plus the  2% risk adjustment underDoudwhich is then adjusted downward to 3%.  3  This interest rate is based upon the prime rate of 3.25% plus a 2% adjustment for risk.  Case 20-01191-als12 Doc 125 Filed 09/16/21 Entered 09/16/21 16:59:52 Desc  Main Document Page 1 of 4

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