House Report 107-111 - RESPONDING TO THE CONTINUING ECONOMIC CRISIS ADVERSELY AFFECTING AMERICAN AGRICULTURAL PRODUCERS

[House Report 107-111]
[From the U.S. Government Publishing Office]

107th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 107-111

======================================================================

RESPONDING TO THE CONTINUING ECONOMIC CRISIS ADVERSELY AFFECTING
AMERICAN AGRICULTURAL PRODUCERS

_______

June 26, 2001.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed

_______

Mr. Combest, from the Committee on Agriculture, submitted the following

R E P O R T

together with

ADDITIONAL VIEWS

[To accompany H.R. 2213]

[Including cost estimate of the Congressional Budget Office]

The Committee on Agriculture, to whom was referred the bill
(H.R. 2213) to respond to the continuing economic crisis
adversely affecting American agricultural producers, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:

SECTION 1. MARKET LOSS ASSISTANCE.

(a) Assistance Authorized.--The Secretary of Agriculture (referred
to in this Act as the ``Secretary'') shall, to the maximum extent
practicable, use $4,622,240,000 of funds of the Commodity Credit
Corporation to make a market loss assistance payment to owners and
producers on a farm that are eligible for a final payment for fiscal
year 2001 under a production flexibility contract for the farm under
the Agriculture Market Transition Act (7 U.S.C. 7201 et seq.).
(b) Amount.--The amount of assistance made available to owners and
producers on a farm under this section shall be proportionate to the
amount of the total contract payments received by the owners and
producers for fiscal year 2001 under a production flexibility contract
for the farm under the Agricultural Market Transition Act.

SEC. 2. SUPPLEMENTAL OILSEEDS PAYMENT.

The Secretary shall use $423,510,000 of funds of the Commodity
Credit Corporation to make a supplemental payment under section 202 of
the Agricultural Risk Protection Act of 2000 (Public Law 106-224; 7
U.S.C. 1421 note) to producers of the 2000 crop of oilseeds that
previously received a payment under such section.

SEC. 3. SUPPLEMENTAL PEANUT PAYMENT.

The Secretary shall use $54,210,000 of funds of the Commodity
Credit Corporation to provide a supplemental payment under section
204(a) of the Agricultural Risk Protection Act of 2000 (Public Law 106-
224; 7 U.S.C. 1421 note) to producers of quota peanuts or additional
peanuts for the 2000 crop year that previously received a payment under
such section. The Secretary shall adjust the payment rate specified in
such section to reflect the amount made available for payments under
this section.

SEC. 4. SUPPLEMENTAL TOBACCO PAYMENT.

(a) Supplemental Payment.--The Secretary shall use $129,000,000 of
funds of the Commodity Credit Corporation to provide a supplemental
payment under section 204(b) of the Agricultural Risk Protection Act of
2000 (Public Law 106-224; 7 U.S.C. 1421 note) to eligible persons (as
defined in such section) that previously received a payment under such
section.
(b) Special Rule for Georgia.--The Secretary may make payments
under this section to eligible persons in Georgia only if the State of
Georgia agrees to use the sum of $13,000,000 to make payments at the
same time, or subsequently, to the same persons in the same manner as
provided for the Federal payments under this section, as required by
section 204(b)(6) of the Agricultural Risk Protection Act of 2000.

SEC. 5. SUPPLEMENTAL WOOL AND MOHAIR PAYMENT.

The Secretary shall use $16,940,000 of funds of the Commodity
Credit Corporation to provide a supplemental payment under section 814
of the Agriculture, Rural Development, Food and Drug Administration,
and Related Agencies Appropriations Act, 2001 (as enacted by Public Law
106-387), to producers of wool, and producers of mohair, for the 2000
marketing year that previously received a payment under such section.
The Secretary shall adjust the payment rate specified in such section
to reflect the amount made available for payments under this section.

SEC. 6. SUPPLEMENTAL COTTONSEED ASSISTANCE.

The Secretary shall use $84,700,000 of funds of the Commodity
Credit Corporation to provide supplemental assistance under section
204(e) of the Agricultural Risk Protection Act of 2000 (Public Law 106-
224; 7 U.S.C. 1421 note) to producers and first-handlers of the 2000
crop of cottonseed that previously received assistance under such
section.

SEC. 7. SPECIALTY CROPS.

(a) Base State Grants.--The Secretary shall use $26,000,000 of
funds of the Commodity Credit Corporation to make grants to the several
States and the Commonwealth of Puerto Rico to be used to support
activities that promote agriculture. The amount of the grant shall be--
(1) $500,000 to each of the several States; and
(2) $1,000,000 to the Commonwealth of Puerto Rico.
(b) Grants for Value of Production.--The Secretary shall use
$133,400,000 of funds of the Commodity Credit Corporation to make a
grant to each of the several States in an amount that represents the
proportion of the value of specialty crop production in the State in
relation to the national value of specialty crop production, as
follows:
(1) California, $63,320,000.
(2) Florida, $16,860,000.
(3) Washington, $9,610,000.
(4) Idaho, $3,670,000.
(5) Arizona, $3,430,000.
(6) Michigan, $3,250,000.
(7) Oregon, $3,220,000.
(8) Georgia, $2,730,000.
(9) Texas, $2,660,000.
(10) New York, $2,660,000.
(11) Wisconsin, $2,570,000.
(12) North Carolina, $1,540,000.
(13) Colorado, $1,510,000.
(14) North Dakota, $1,380,000.
(15) Minnesota, $1,320,000.
(16) Hawaii, $1,150,000.
(17) New Jersey, $1,100,000.
(18) Pennsylvania, $980,000.
(19) New Mexico, $900,000.
(20) Maine, $880,000.
(21) Ohio, $800,000.
(22) Indiana, $660,000.
(23) Nebraska, $640,000.
(24) Massachusetts,$640,000.
(25) Virginia, $620,000.
(26) Maryland, $500,000.
(27) Louisiana, $460,000.
(28) South Carolina, $440,000.
(29) Tennessee, $400,000.
(30) Illinois, $400,000.
(31) Oklahoma, $390,000.
(32) Alabama, $300,000.
(33) Delaware, $290,000.
(34) Mississippi, $250,000.
(35) Kansas, $210,000.
(36) Arkansas, $210,000.
(37) Missouri, $210,000.
(38) Connecticut, $180,000.
(39) Utah, $140,000.
(40) Montana, $140,000.
(41) New Hampshire, $120,000.
(42) Nevada, $120,000.
(43) Vermont, $120,000.
(44) Iowa, $100,000.
(45) West Virginia, $90,000.
(46) Wyoming, $70,000.
(47) Kentucky, $60,000.
(48) South Dakota, $40,000.
(49) Rhode Island, $40,000.
(50) Alaska, $20,000.
(c) Specialty Crop Priority.--As a condition on the receipt of a
grant under this section, a State shall agree to give priority to the
support of specialty crops in the use of the grant funds.
(d) Specialty Crop Defined.--In this section, the term ``specialty
crop'' means any agricultural crop, except wheat, feed grains,
oilseeds, cotton, rice, peanuts, and tobacco.

SEC. 8. COMMODITY ASSISTANCE PROGRAM.

The Secretary shall use $10,000,000 of funds of the Commodity
Credit Corporation to make a grant to each of the several States to be
used by the States to cover direct and indirect costs related to the
processing, transportation, and distribution of commodities to eligible
recipient agencies. The grants shall be allocated to States in the
manner provided under section 204(a) of the Emergency Food Assistance
Act of 1983 (7 U.S.C. 7508(a)).

SEC. 9. TECHNICAL CORRECTION REGARDING INDEMNITY PAYMENTS FOR COTTON
PRODUCERS.

(a) Conditions on Payment to State.--Subsection (b) of section 1121
of the Agriculture, Rural Development, Food and Drug Administration,
and Related Agencies Appropriations Act, 1999 (as contained in section
101(a) of division A of Public Law 105-277 (7 U.S.C. 1421 note), and as
amended by section 754 of the Agriculture, Rural Development, Food and
Drug Administration, and Related Agencies Appropriations Act, 2001 (as
enacted by Public Law 106-387; 114 Stat. 1549A-42), is amended to read
as follows:
``(b) Conditions on Payment to State.--The Secretary of Agriculture
shall make the payment to the State of Georgia under subsection (a)
only if the State--
``(1) contributes $5,000,000 to the indemnity fund and agrees
to expend all amounts in the indemnity fund by not later than
January 1, 2002 (or as soon as administratively practical
thereafter), to provide compensation to cotton producers as
provided in such subsection;
``(2) requires the recipient of a payment from the indemnity
fund to repay the State, for deposit in the indemnity fund, the
amount of any duplicate payment the recipient otherwise
recovers for such loss of cotton, or the loss of proceeds from
the sale of cotton, up to the amount of the payment from the
indemnity fund; and
``(3) agrees to deposit in the indemnity fund the proceeds of
any bond collected by the State for the benefit of recipients
of payments from the indemnity fund, to the extent of such
payments.''.
(b) Additional Disbursements From the Indemnity Fund.--Subsection
(d) of such section is amended to read as follows:
``(d) Additional Disbursement to Cotton Ginners.--The State of
Georgia shall use funds remaining in the indemnity fund, after the
provision of compensation to cotton producers in Georgia under
subsection (a) (including cotton producers who file a contingent claim,
as defined and provided in section 5.1 of chapter 19 of title 2 of the
Official Code of Georgia), to compensate cotton ginners (as defined and
provided in such section) that--
``(1) incurred a loss as the result of--
``(A) the business failure of any cotton buyer doing
business in Georgia; or
``(B) the failure or refusal of any such cotton buyer
to pay the contracted price that had been agreed upon
by the ginner and the buyer for cotton grown in Georgia
on or after January 1, 1997, and had been purchased or
contracted by the ginner from cotton producers in
Georgia;
``(2) paid cotton producers the amount which the cotton
ginner had agreed to pay for such cotton received from such
cotton producers in Georgia; and
``(3) satisfy the procedural requirements and deadlines
specified in chapter 19 of title 2 of the Official Code of
Georgia applicable to cotton ginner claims.''.
(c) Conforming Amendment.--Subsection (c) of such section is
amended by striking ``Upon the establishment of the indemnity fund, and
not later than October 1, 1999, the'' and inserting ``The''.

SEC. 10. INCREASE IN PAYMENT LIMITATIONS REGARDING LOAN DEFICIENCY
PAYMENTS AND MARKETING LOAN GAINS.

Notwithstanding section 1001(2) of the Food Security Act of 1985 (7
U.S.C. 1308(1)), the total amount of the payments specified in section
1001(3) of that Act that a person shall be entitled to receive for one
or more contract commodities and oilseeds under the Agricultural Market
Transition Act (7 U.S.C. 7201 et seq.) during the 2001 crop year may
not exceed $150,000.

SEC. 11. TIMING OF, AND LIMITATION ON, EXPENDITURES.

(a) Deadline for Expenditures.--All expenditures required by this
Act shall be made not later than September 30, 2001. Any funds made
available by this Act and remaining unexpended by October 1, 2001,
shall be deemed to be unexpendable, and the authority provided by this
Act to expend such funds is rescinded effective on that date.
(b) Total Amount of Expenditures.--The total amount expended under
this Act may not exceed $5,500,000,000. If the payments required by
this Act would result in expenditures in excess of such amount, the
Secretary shall reduce such payments on a pro rata basis as necessary
to ensure that such expenditures do not exceed such amount.

SEC. 12. REGULATIONS.

(a) Promulgation.--As soon as practicable after the date of the
enactment of this Act, the Secretary and the Commodity Credit
Corporation, as appropriate, shall promulgate such regulations as are
necessary to implement this Act and the amendments made by this Act.
The promulgation of the regulations and administration of this Act
shall be made without regard to--
(1) the notice and comment provisions of section 553 of title
5, United States Code;
(2) the Statement of Policy of the Secretary of Agriculture
effective July 24, 1971 (36 Fed. Reg. 13804), relating to
notices of proposed rulemaking and public participation in
rulemaking; and
(3) chapter 35 of title 44, United States Code (commonly
known as the ``Paperwork Reduction Act'').
(b) Congressional Review of Agency Rulemaking.--In carrying out
this section, the Secretary shall use the authority provided under
section 808 of title 5, United States Code.

Brief Explanation

H.R. 2213 will provide assistance to U.S. agricultural
producers, most of which is generally based on assistance
provided for the 2000 crop year in the Agricultural Risk
Protection Act of 2000 (Pub. L. 106-224) (``ARPA''). The bill
limits total expenditures to $5.5 billion, all of which occur
in fiscal year 2001. If expenditures under any section of the
bill would result in spending above $5.5 billion, the Secretary
of Agriculture is required to make a pro rata reduction in such
payments in order to ensure that total expenditures in fiscal
year 2001 do not exceed $5.5 billion.
The following supplemental expenditures represent an 84.7%
prorate from assistance received in 2000--
$4,622,240,000 for supplemental market loss
assistance payments to individuals receiving an
Agricultural Market Transition Act (``AMTA'') payment.
$423,510,000 to producers of 2000 crop of oilseeds in
accordance with ARPA.
$54,210,000 to producers of peanuts in accordance
with ARPA.
$129,000,000 to tobacco quota holders in accordance
with ARPA.
Special rule for Georgia: no payments will be
made unless the State of Georgia agrees to use
$13,000,000 to make payments in the same
manner.
$16,940,000 to producers of wool and mohair under the
same terms as was provided in the fiscal year 2001
Agriculture Appropriations Act.
$84,700,000 to producers and first-handlers of
cottonseed in accordance with ARPA.
$159,400,000 in assistance to specialty crops in the
following manner:
$1,000,000 grant to Puerto Rico to promote
agriculture.
$500,000 grants to each State to promote
agriculture.
Grants to each state totaling $133,400,000
based on the value of production of specialty
crops in relation to the national value of
specialty crop production.
States receiving these grants must agree to
give a priority to specialty crops as a
condition of the grant.
$10,000,000 to make grants to States for direct and
indirect costs related to the processing,
transportation, and distribution of commodities.
The Act also:
Makes a technical change to the FY 1999 Agriculture
Appropriations Act to allow the State of Georgia to use
the indemnity funds already provided for certain
producers that suffered economic losses in 1998 and
1999.
Limits total payments to a person for contract
commodities and oilseeds under AMTA to $150,000.
Requires that all expenditures under this Act be made
by September 30, 2001.

Purpose and Need

American agriculture is in an economic crisis. In 2000,
crop prices were at a 27-year low for soybeans, a 25-year low
for cotton, a 14-year low for wheat and corn and an 8-year low
for rice. Over the past three years, net cash income fell in
real dollars to its lowest point since the Great Depression.
The current farm recession, in its fourth year, ranks among the
deepest in our nation's history, along with the Great
Depression, the post-World War I and II recessions, and the
financial ruin of the 1980s.
For 2001, most projections show very little improvement in
commodity prices with production expenses rising to record
levels. Looking back to when Congress passed the Federal
Agriculture Improvement and Reform Act of 1996, no one on
either side of the aisle predicted the current malaise of high
costs and low commodity prices. In fact, today's prices for
wheat, corn and soybeans are 31 percent lower than the U.S.
Department of Agriculture's (``USDA'') projected prices at the
time the legislation was enacted.
There are many factors that have contributed to this dismal
situation that are beyond the control of individual producers.
American agriculture depends heavily on the strength of foreign
markets for returns on commodity production. In recent months,
however, worldwide demand for U.S. products has not met
expectations for a variety of reasons. Repercussions are still
being felt from the Asian economic crisis that began three
years ago. Further, three years of worldwide good weather have
created commodity surpluses all around the globe. Compounding
this situation for U.S. producers is the strength of the dollar
that has contributed to a substantial increase in the relative
cost of U.S. commodities. In fact, USDA estimates that the
value of the dollar is up 25 percent relative to our customers'
currencies and up 40 percent relative to our major competitors'
currencies.
In addition, domestic producers continue to compete on an
uneven international playing field in light of trade barriers.
Despite some progress in lowering trade barriers through the
World Trade Organization, the fact remains that the average
tariff on U.S. farm products in other countries is 62 percent,
while the average U.S. tariff on goods coming into the U.S. is
approximately 12 percent. Beyond high tariffs, our farmers also
face the daunting challenge of competing with high foreign
subsidies. For example, the average subsidy level in the
European Union during 1997 to 1999 was $342 per acre, while the
average subsidy level in the U.S. was only $43 per acre.
The effect of low commodity prices has been magnified in
the 2001 crop year by skyrocketing energy costs. Between 1999
and 2000, U.S. producers incurred an additional $2.4 billion in
fuel costs. This is a 40 percent increase from years past. For
the 2001 crop year, energy costs are expected to contribute to
a $1.5 billion increase in production expenses. Diesel prices
for 2001 are expected to average $1.50 per gallon which is a 50
percent increase from last year. In addition, last year's
rising natural gas prices have fueled sharply increased costs
for irrigation and nitrogen fertilizer.
In each of the last three years, Congress has responded to
the needs of American agriculture with emergency assistance.
This money has provided a critical source of income for
producers of contract crops and soybeans. Indeed, had Congress
not provided nearly $25 billion in supplemental assistance to
farmers in the last three years, tens of thousands of farmers
would have been forced out of business, having a devastating
impact on rural America. Without additional support in 2001,
total net returns for these producers are expected to decline
significantly from 2000 levels in light of continued anemic
commodity prices and higher costs of production. Accordingly,
additional economic assistance for producers in the 2001 crop
years is justified.
Importantly, the supplemental assistance to farmers and
ranchers that this legislation provides is fully contemplated
by and is in compliance with the Budget Resolution passed by
Congress earlier this year.
Providing income assistance for the 2001 crop year is
constrained by USDA's ability to meet the September 30, 2001
deadline for disbursing payments. Even in the fourth year of
annual economic loss assistance, USDA remains unable to improve
its use of producer data to enhance program delivery criteria.
On several related fronts USDA is doing an inadequate job in
ensuring that their data information systems meet the direction
of Congress and the needs of producers.
The Committee is disappointed with the manner in which USDA
has implemented Section 121(c) of ARPA. Section 121 requires
the Farm Service Agency (FSA) and the Risk Management Agency
(RMA) to reconcile producer information of the two agencies.
The Committee is concerned that RMA and FSA will not meet the
time deadline for reconciling information required by Section
121. One year has elapsed since the enactment of ARPA and RMA
and FSA have not modified their data information systems to
capture farm, unit, acreage, and production information in a
format that is reconcilable.
On a related note, RMA has contracted with the Center for
Agribusiness Excellence at Tarleton State University as
directed by ARPA. However, FSA has failed to provide needed
producer information. The Committee expects the Secretary to
require FSA to make available all relevant information in the
same manner as RMA to the Center for Agribusiness Excellence so
that it can proceed in reconciling producer information. The
Committee believes that reconciling this information will
benefit taxpayers by helping to identify waste, fraud and
abuse, and assist producers through the identification of
program deficiencies. In addition, it should allow FSA and RMA
to improve service and provide policy makers with data needed
to make decisions by providing reliable and up-to-date
information. Most importantly, the Committee expects that this
system can assist USDA by developing a paradigm on how to
utilize a comprehensive and compatible information system.
Beyond providing immediate economic assistance to producers
through this legislation, the Committee also expects USDA to
address several other important issues administratively using
existing authorities.
First, the Committee is very concerned about the delay in
delivering crop insurance and disaster assistance to producer
members of the Southern Minnesota Sugar Beet Cooperative.
Approximately 600 Minnesota sugar beet producers suffered
losses on their 2000 crop year crops due to freeze damage. The
losses associated with the freeze threaten hundreds of farm
families, the cooperative, and the jobs the cooperative
provides.
The Committee understands that despite a determination by
RMA that the losses are insurable (MGR Bulletin 01-010, dated
March 2, 2001), crop insurance claims have still not been
satisfied. Further, since eligibility for disaster assistance
(authorized under Section 815 of the Agriculture Appropriations
Bill for FY2001) is made administratively contingent upon loss
determinations made under the Federal Crop Insurance Program,
producers have not received this assistance either, even though
authority for this program expires on September 30, 2001.
The Committee believes that the delay by RMA and FSA is
unacceptable and expects the two agencies to take immediate
steps to provide sugar beet producers with crop insurance and
disaster assistance.
The Committee is aware that the RMA is not providing loss
adjustment information that the private insurance providers
have requested, citing that loss adjustments are not RMA's
responsibility. The Committee notes, however, that the cause of
the problem--the failure to correct a flaw in the sugar beet
policy that was first revealed 16 years ago in a successful
lawsuit against the FCIC--is the RMA's responsibility.
Further, the Committee understands the reluctance of the
private insurance providers to adjust the claims for fear that
any losses improperly paid may not be reinsured by RMA.
However, disagreements over the Standard Reinsurance Agreement
(SRA)--a contract betweenRMA and private insurance providers--
should be resolved between the parties to the SRA and should never
prejudice or delay the claim of a producer who is not privy to that
contract.
Nevertheless, given the circumstances, the Committee
expects RMA to work cooperatively and without further delay
with the private insurance providers and producer and
cooperative representatives to satisfy producer claims within a
period of time that will allow FSA to make disaster payments on
these claims before September 30, 2001. In any case, the
Committee expects that under no circumstances will FSA fail to
make disaster payments to these producers before authority to
do so expires September 30, 2001.
As the Chief Judge of the 8th Circuit U.S. Court of Appeals
made clear in a similar case, the fact that sugar beets were
processed does not negate the fact that there is an insurable
loss for which the insured is entitled to receive an indemnity,
nor is it dispositive as to how the loss should ultimately be
calculated. Because this principle is as applicable to disaster
assistance as it is to crop insurance, the Committee sees no
reason for FSA to wait for a decision by RMA. The Committee
would note that since affected sugar producers are all members
of the same cooperative and share equally in patronage
dividends, an aggregate payment could be made to the
cooperative on the condition that such a payment would be
equitably distributed to producer members.
Second, the Committee is concerned about the increasing
risk to our nation's food supply from plant and animal pests
and diseases. Recent outbreaks of Karnal bunt in Texas,
Pierce's disease in California, citrus canker in Florida and
the threat of Foot and Mouth disease to our livestock industry
has the Committee concerned that the Secretary's existing
authority to declare emergencies may be insufficient to
proactively address these critical emergencies. The Committee
urges the Secretary to use existing authority to rapidly
respond to pest and disease outbreaks and provide producers and
agribusinesses whose income has been affected by such outbreaks
with timely compensation.
The Committee recognizes that the Animal and Plant Health
Inspection Service plays a critical role in protecting the
agricultural sector in the United States from outbreaks of
foreign plant and animal diseases and invasive pests and in
containing and mitigating the deleterious effects of outbreaks
when they do occur.
The recent outbreak of Food and Mouth Disease in the United
Kingdom and in Europe has highlighted the critical need for
increased investment of resources in the Animal and Plant
Health Inspection Service as well as the need for closer
coordination and collaboration between APHIS and other agencies
and jurisdictions, such as FEMA, state governments, and local
governments, that might find themselves involved in the
containment of plant and animal diseases and pests.
The Committee urges the Department of Agriculture to
conduct a top to bottom review of its ability to respond
quickly and adequately to the outbreak of catastrophic plant
and animal diseases and invasive pests. For example, due to the
concentrated nature of livestock operations in many states such
as North Carolina, an outbreak of a disease like Foot and Mouth
Disease would spread rapidly, threatening not only a multi-
billion dollar livestock industry, but the entire state
economy.
In its re-examination of farm policy and in writing a farm
bill in the 107th Congress, the Committee will closely examine
ways in which to increase the resources available to APHIS and
also possibilities to improve the capacity of APHIS to
adequately respond to potential threats and outbreaks that
threaten to undermine and damage the US agricultural sector.
Third, the Committee also notes that the Department has not
yet expended the funds made available by section 203(e) of ARPA
with regard to Pierce's Disease. The $25 million in funding
made available by section 203(e) was provided to USDA to
compensate growers for losses due to the plum pox virus, citrus
canker, and Pierce's disease, and USDA has expended the funds
to compensate growers with respect to the plum pox virus and
citrus canker. Citrus canker is a devastating disease affecting
citrus production and immediate efforts to control and
eradicate the disease are necessary to prevent spread of citrus
canker to other citrus-growing areas. The Committee applauds
the U.S. Secretary of Agriculture's efforts to enable crucial
eradication and control measures to continue and encourages
these actions to move toward completion.
With the remaining $7.14 million of the funds made
available by section 203(e) of ARPA, the Committee expects USDA
to expend these funds in a manner that: (1) is consistent with
section 261(a)(2) of ARPA; and (2) compensates growers for
economic losses associated with the destruction of grape vines
due to Pierce's disease without limits of payments to
individual growers and without grower eligibility requirements
based on gross income. The Committee notes that USDA has the
authority to enter into cooperative agreements or contracts
with state agencies, such as the California Department of Food
and Agriculture, and urges the Department to expedite this
process in order to accomplish the goals of section 203(e) of
ARPA in a timely manner.
The Committee also urges the Secretary to reassess the
valuation of tangerines in its final rule on citrus canker
commercial compensation recognizing the discrepancy in values
between the average price for tangerines and that of Valencia
oranges. Using existing funds designated to compensate growers
for losses due to citrus canker, the Secretary is encouraged to
issue payments to tangerine growers who have lost their groves
due to citrus canker based on the recalculated value of
tangerines.
Finally, the Committee urges the Secretary to utilize the
authority of section 815 of the FY 2001 agricultural
appropriations act to provide assistance to orchardists and
tree farmers who have planted trees for commercial purposes but
have lost the trees as a result of a natural disaster for the
2000 crop. The assistance provided should reimburse a portion
of the cost of replanting lost trees.

Section-by-Section

Section 1. Market loss assistance

Section 1 requires the Secretary of Agriculture to use
$4,622,240,000 of funds of the Commodity Credit Corporation to
make a market loss assistance payment to owners and producers
on a farm that are eligible for a final payment for fiscal year
2001 under a production flexibility contract for the farm under
the Agriculture Market Transition Act.

Section 2. Supplemental oilseeds payment

Section 2 requires the Secretary to use $423,510,000 of the
funds of the Commodity Credit Corporation to make supplemental
payments under section 202 of Agricultural Risk Protection Act
(ARPA) to producers of the 2000 crop of oilseeds that
previously received a payment .

Section 3. Supplemental peanut payment

Section 3 requires the Secretary to use $54,210,000 of the
funds of the Commodity Credit Corporation to provide
supplemental payments under section 204(a) of ARPA to producers
of quota or additional peanuts for the 2000 crop year that
previously received a payment.

Section 4. Supplemental tobacco payment

Section 4 requires the Secretary to use $129,000,000 of the
funds of the Commodity Credit Corporation to provide
supplemental payments under section 204(b) of ARPA to eligible
persons that previously received a payment. The section also
provides that the Secretary may make payments to Georgia
producers only if the State of Georgia makes $13 million in
payments to such producers.

Section 5. Supplemental wool and mohair payment

Section 5 requires the Secretary to use $16,940,000 of the
funds of the Commodity Credit Corporation to provide a
supplemental payment under section 814 of the Agriculture,
Rural Development, Food and Drug Administration, and Related
Agencies Appropriations Act for Fiscal Year 2001 to producers
of wool and mohair for the 2000 marketing year that previously
received a payment. The payment rate will be adjusted to
reflect the $16,940,000 made available for payments.

Section 6. Supplemental cottonseed assistance

Section 6 requires the Secretary to use $84,700,000 of
funds of the Commodity Credit Corporation to provide
supplemental assistance under section 204(e) of ARPA to
producers and first-handlers of the 2000 crop of cottonseed
that previously received assistance.

Section 7. Specialty crops

Subsection 7(a) requires the Secretary to use $26 million
of the funds of the Commodity Credit Corporation to make a
grant in the amount of $500,000 to each of the several States
and $1,000,000 to Puerto Rico to support activities that
promote agriculture.
Subsection 7(b) requires the Secretary to use $133,400,000
of the funds of the Commodity Credit Corporation to make a
grant to each State in an amount that represents the proportion
of the value of specialty crop production in the State in
relation to the national value of specialty crop production as
specified in the legislation.
Subsection 7(c) requires the States to give priority to the
support of specialty crops in the use of the grant funds as a
condition on the receipt of a grant.
Subsection 7(d) defines specialty crop to mean any crop of
an agricultural commodity except wheat, feed grains, oilseeds,
cotton, rice, peanuts, and tobacco.
The Committee expects that the grants provided in this Act
to the States will be used to assist growers of specialty
crops. The Committee expects that the States will use all means
necessary to ensure that specialty crops are given the priority
established in this Act in the use of these funds. Specialty
crops need these additional resources because of the many
different and difficult circumstances facing specialty crop
growers resulting from disease, low prices, and lack of funding
for research, promotion, and inspection, to name just a few.
For example, many growers have indicated interest in using this
funding for value-added research, such as that envisioned by
Arkansas State University. The Committee expects these funds to
be in addition to any funds already provided by the States to
support agriculture and expects the States to maintain their
current efforts to support agriculture.

Section 8. Commodity assistance program

Section 8 requires the Secretary to use $10,000,000 of
funds of the Commodity Credit Corporation to make grants to
States to pay direct and indirect costs related to the
processing, transportation, and distribution of commodities
under section 204(a) of the Emergency Food Assistance Act of
1983 (EFAP).

Section 9. Technical correction regarding indemnity payments for cotton
producers

Section 9 amends subsection (b) of section 1121 of the
Agriculture, Rural Development, Food and Drug Administration,
and Related Agencies Appropriations Act for Fiscal year 1999 as
previously amended to allow the State of Georgia to use the
indemnity funds already provided for cotton producers and
ginners that suffered economic losses due to the failure of a
warehouse.

Section 10. Increase in payment limitations regarding loan deficiency
payments and marketing loan gains

Section 10 limits marketing loan gains and loan deficiency
payments for 2001 crops to $150,000 per person.

Section 11. Timing of, and limitation on, expenditures

Section 12 requires that all expenditures required by this
Act will be made before September 30, 2001. The total amount
that can be expended is $5,500,000,000. If the payments
required by section 1 through 11 would result in expenditures
in excess of $5,500,000,000, the Secretary must reduce the
payments on a pro rata basis to ensure that the expenditures do
not exceed $5,500,000,000.

Section 12. Regulations

Section 13 requires the Secretary and the CCC, whichever is
appropriate, to promulgate regulations to implement this Act
without regard to notice and comment rulemaking.

Committee Consideration

The Committee on Agriculture met, pursuant to notice, with
a quorum present, on June 20, 2001, to consider H.R. 2213, a
bill to respond to the continuing economic crisis adversely
affecting American agricultural producers.
Chairman Combest made a brief opening statement and then
recognized Mr. Stenholm for remarks.
After opening remarks and brief discussion of the bill, the
Chairman, without objection, placed H.R. 2213 before the
Committee to be open for amendment at any point.
Mr. Stenholm was then recognized to offer and explain an
Amendment in the Nature of a Substitute on behalf of himself
and Mr. Boehner that limited the overall assistance to $5.5
billion in Fiscal year 2001 funds.
Mr. Chambliss was recognized to offer and explain an
amendment to the Substitute Amendment that was a technical
correction to the tobacco payment allocation under the Tobacco
Settlement Agreement of the State of Georgia which allows for
matching payments to producers. Discussion occurred and the
amendment was adopted, by a voice vote.
Mr. Condit was also recognized to offer and explain an
amendment verbally to the Substitute Amendment that would lower
the amount of base state grants (excluding Puerto Rico) and
provide a corresponding increase in the amount of value
production grants. Discussion occurred and the amendment was
adopted, by a voice vote.
Mr. Holden was then recognized to offer and explain an
amendment on behalf of himself and Mr. Baldacci to the
Substitute Amendment to transfer $430 million from AMTA
payments to specialty crops. Discussion occurred and by a voice
vote, the amendment failed.
Mr. Boswell was also recognized to offer and explain an
amendment to the Substitute Amendment that would provide crop
loss assistance for 2001 crops. Discussion occurred and without
objection, the amendment was withdrawn.
Further discussion occurred on the Substitute Amendment and
it was adopted by a vote of 24 yeas, 23 nays, and 4 not voting.
See Roll Call Vote #1.
Mr. Condit offered and explained an amendment to provide
assistance for agricultural producers whose energy costs have
increased during calendar 2001. Discussion occurred and the
amendment was ruled out of order.
Mr. Smith was then recognized to offer and explain an
amendment that would add asparagus to the list of purchases.
Discussion occurred and without objection, the amendment was
withdrawn.
Mr. Thompson of California was then recognized to offer and
explain an amendment to provide payment to producers that
incurred losses as a result of the Tri-Valley Growers
bankruptcy. Discussion occurred and without objection, the
amendment was withdrawn.
Mr. Thompson offered and explained another amendment that
would provide payment on a prorated basis to producers that
incurred losses as a result of the Tri-Valley Growers
bankruptcy. Discussion occurred and by a voice vote, the
amendment failed.
Mr. Lucas of Oklahoma was then recognized to offer and
explain an amendment that would prohibit the Secretary of
Agriculture from spending any USDA funds to designate critical
habitat of the Arkansas River. Discussion occurred and without
objection, the amendment was withdrawn.
Mr. Berry was recognized to offer and explain an amendment
to limit the amount received for one or more contract
commodities and oilseeds. Discussion occurred and by a voice
vote, the amendment, as amended, was adopted.
Mr. Smith was then recognized to offer and explain an
amendment to provide assistance to eligible orchardists and
tree farmers. Discussion occurred and without objection, the
amendment was withdrawn.
Mr. Pombo was recognized to offer and explain an amendment
to provide compensation for growers for losses due to Pierce's
Disease. Discussion occurred and by a voice vote, the amendment
was adopted.
Mr. Gutknecht was also recognized to offer and explain an
amendment to impose tariff-rate quotas on certain casein and
milk concentrates. Discussion occurred and without objection,
the amendment was withdrawn.
Mr. Fletcher was recognized to offer and explain an
amendment to allow horse breeders affected by the Mare
Reproductive Loss Syndrome to apply for USDA disaster loans for
a period of two years. Discussion occurred and without
objection, the amendment was withdrawn.
Mr. Kennedy was then recognized to offer and explain report
language regarding the difficulties faced by Minnesota beet
growers. Discussion occurred and without objection, report
language was accepted.
Mr. Stenholm was then recognized to offer and explain
report language regarding Farm Service Agency producer
information. Discussion occurred and without objection, report
language was accepted.
Mrs. Clayton was then recognized to offer and explain an
amendment on behalf of herself, Mr. Putnam and Mr. Condit that
would provide an increase in funds of $35 million for USDA's
Animal and Plant Health Inspection Service to respond to pests
and foot-and- mouth disease. Discussion occurred and without
objection, the amendment was withdrawn. However, report
language was accepted in lieu of the amendment.
Mr. Putnam was also recognized to respond and noted that he
wanted the report language to acknowledge that there is an
emergency now even though it is a preventative effort rather
than an eradication effort to keep foot-and-mouth disease off
our shores. Without objection, the report language was
accepted.
There being no further amendments, Mr. Stenholm moved that
the bill, H.R. 2213, as amended, be adopted and reported
favorably to the House with the recommendation that it do pass.
By a roll call vote of 31 yeas, 14 nays, and 6 not voting,
H.R. 2213 was ordered reported favorably to the House. See Roll
Call Vote #2.
Mr. Stenholm also moved, pursuant to clause 1 rule XX, that
the Committee authorize the Chairman to offer such motions as
may be necessary in the House to go to conference with the
Senate on the bill H.R. 2213, or any similar Senate bill.
Without objection, the motion was agreed to and the
Committee adjourned.

Roll Call Votes

In compliance with clause 3(b) of Rule XIII of the House of
Representatives, the Committee sets forth the record of the
following roll call votes taken with respect to H.R. 2213.

Roll Call No. 1

Summary: Amendment in the Nature of a Substitute limiting
overall assistance to $5.5 billion, with $4.6 billion in market
loss payments to major crop producers, and the balance to
oilseed, peanut, wool and mohair, tobacco quota holders, as
well as handlers and producers of cottonseed.
Offered By: Mr. Stenholm and Mr. Boehner.
Results: The Substitute Amendment was adopted with 24 yeas,
23 nays, and 4 not voting.

YEAS

1. Mr. Boehner
2. Mr. Goodlatte
3. Mr. Pombo
4. Mr. Chambliss
5. Mr. Gutknecht
6. Mr. Fletcher
7. Mr. Putnam
8. Mr. Stenholm
9. Mr. Condit
10. Mr. Peterson
11. Mr. Dooley
12. Mrs. Clayton
13. Mr. Hilliard
14. Mr. Holden
15. Mr. Baldacci
16. Mr. McIntyre
17. Mr. Phelps
18. Mr. Lucas (KY)
19. Mr. Thompson (CA)
20. Mr. Hill
21. Mr. Baca
22. Mr. Larsen
23. Mr. Acevedo-Vila
24. Mr. Kind

NAYS

1. Mr. Combest
2. Mr. Smith
3. Mr. Everett
4. Mr. Lucas (OK)
5. Mr. Moran
6. Mr. Thune
7. Mr. Jenkins
8. Mr. Cooksey
9. Mr. Riley
10. Mr. Simpson
11. Mr. Ose
12. Mr. Hayes
13. Mr. Pickering
14. Mr. Johnson
15. Mr. Osborne
16. Mr. Pence
17. Mr. Rehberg
18. Mr. Graves
19. Mr. Kennedy
20. Mr. Berry
21. Mr. Boswell
22. Mr. Ross
23. Mr. Shows

NOT VOTING

1. Mr. Schaffer
2. Mr. Bishop
3. Mr. Thompson (MS)
4. Mr. Etheridge

Roll Call No. 2

Summary: Final passage of bill, as amended.
Requested By: Chairman Combest.
Results: H.R. 2213 was ordered reported, as amended,
favorably to the House by a vote of 31 yeas, 14 nays, and 6 not
voting.

YEAS

1. Mr. Boehner
2. Mr. Pombo
3. Mr. Everett
4. Mr. Chambliss
5. Mr. Cooksey
6. Mr. Gutknecht
7. Mr. Fletcher
8. Mr. Johnson
9. Mr. Graves
10. Mr. Putnam
11. Mr. Kennedy
12. Mr. Stenholm
13. Mr. Condit
14. Mr. Peterson
15. Mr. Dooley
16. Mrs. Clayton
17. Mr. Hilliard
18. Mr. Holden
19. Mr. Bishop
20. Mr. Thompson (MS)
21. Mr. Baldacci
22. Mr. Berry
23. Mr. Phelps
24. Mr. Thompson (CA)
25. Mr. Hill
26. Mr. Baca
27. Mr. Larsen
28. Mr. Ross
29. Mr. Acevedo-Vila
30. Mr. Kind
31. Mr. Shows

NAYS

1. Mr. Combest
2. Mr. Goodlatte
3. Mr. Smith
4. Mr. Lucas (OK)
5. Mr. Moran
6. Mr. Thune
7. Mr. Jenkins
8. Mr. Simpson
9. Mr. Ose
10. Mr. Hayes
11. Mr. Pickering
12. Mr. Osborne
13. Mr. Rehberg
14. Mr. Boswell

NOT VOTING

1. Mr. Schaffer
2. Mr. Riley
3. Mr. Pence
4. Mr. McIntyre
5. Mr. Etheridge
6. Mr. Lucas (KY)

Committee Oversight Findings

Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee on Agriculture's
oversight findings and recommendations are reflected in the
body of this report.

Budget Act Compliance (Sections 308, 402, and 423)

The provisions of clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives and section 308(a)(1) of the
Congressional Budget Act of 1974 (relating to estimates of new
budget authority, new spending authority, new credit authority,
or increased or decreased revenues or tax expenditures) are not
considered applicable. The estimate and comparison required to
be prepared by the Director of the Congressional Budget Office
under clause 3(c)(3) of rule XIII of the Rules of the House of
Representatives and sections 402 and 423 of the Congressional
Budget Act of 1974 submitted to the Committee prior to the
filing of this report are as follows:

U.S. Congress,
Congressional Budget Office,
Washington, DC,
Hon. Larry Combest,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2213, a bill to
respond to the continuing economic crisis adversely affecting
American agricultural producers.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Jim Langley.
Sincerely,
Robert A. Sunshine
(For Dan L. Crippen, Director).
Enclosure.

H.R. 2213--A bill to respond to the continuing economic crisis
adversely affecting American agricultural producers

Summary: H.R. 2213 would authorize new direct spending of
$5.5 billion from the Commodity Credit Corporation to benefit
agricultural producers. The bill also would make certain
technical corrections to agricultural laws and would increase
payment limitations for marketing assistance loan benefits; CBO
estimates that these other provisions would have no cost.
Because the bill would increase direct spending by $5.5 billion
in 2001, pay-as-you-go procedures would apply.
H.R. 2213 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
It would require the state of Georgia to make payments to
tobacco producers in that state as a condition of federal
assistance to those producers. Any such payments would be
voluntary.
Estimated Cost to the Federal Government: The estimated
budgetary impact of H.R.. 2213 is shown in the following table.
The costs of this legislation fall within budget functions 350
and 600 (agriculture and income security).

Estimated Budget Authority.......................... 5,500 0 0 0 0 0
Estimated Outlays................................... 5,500 0 0 0 0 0
----------------------------------------------------------------------------------------------------------------

Basis of estimate: H.R. 2213 would authorize the Secretary
of Agriculture to use the Commodity Credit Corporation (CCC) to
make $5.5 billion available to agricultural producers in 2001.
Most of these funds would go directly to producers who were
eligible to receive the assistance provided in the Agricultural
Risk Protection Act of 2000 and the Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies
Appropriations Act, 2001. About $159 million would be given to
the states and Puerto Rico to support speciality crops, and
states would receive $10 million to pay for costs associated
with processing, transporting, and distributing commodities
under the provisions of the Emergency Food Assistance Program.
The bill would require that all obligations and expenditures be
made prior to September 30, 2001, and that any funds not
obligated by that date would be rescinded.
Section 1 would provide $4.6 billion for payments for
market loss assistance to producers of feed grains, wheat,
cotton, and rice. Sections 2 through 6 would provide $424
million to oilseed producers, $54 million to peanut producers,
$129 million to tobacco producers, $17 million to wool and
mohair producers, and $85 million to producers and first
handlers of cottonseed. Under this bill, the Secretary could
make tobacco payments to producers in Georgia only if the state
of Georgia makes $13 million in payments to the same eligible
producers in the state in a timely manner. For this estimate,
CBO assumes that Georgia would make these payments.
Section 9 would make certain technical corrections to
current law regarding indemnity payments for cotton producers.
CBO estimates these corrections would have no cost. These
provisions deal with payments to cotton producers in Georgia.
The 1999 agricultural appropriations act authorized the
Secretary of Agriculture to transfer $5 million to the State of
Georgia to establish an indemnity fund to assist cotton
producers who suffered income losses resulting from the failure
of certain cotton merchants to pay producers for their cotton.
As a condition of the payment, Georgia was required to
contribute a matching $5 million to the indemnity fund. The $5
million from the Agriculture Department has already been
transferred and used to make payments to eligible producers.
However, Georgia did not contribute its share in a timely
manner, despite an extension of the deadline in the 2001
agricultural appropriations act. Section 9 would extend the
deadline for Georgia to contribute its share of the indemnity
funds, but would not authorize or permit any additional federal
funds to be expended.
Section 10 would increase the payment limitations for loan
deficiency payments (LDPs) and marketing loan gains (MLGs) to
$150,000 per person during the 2001 crop year. LDPs and MLGs
allow producers to repay commodity loans at less than the full
amount of the loan whenever market prices drop below specified
levels for each eligible commodity. The limitation for these
payments was originally $75,000 per person. The Agriculture
Department is authorized to issue loan benefits in the form of
commodity certificates instead of cash payments. Such
certificates ultimately result in equivalent cash outlays by
the department, but do not count against payment limitations.
Consequently, CBO estimates that the bill's changes to payment
limitations on LDPs and MLGs would not result in any additional
federal outlays.
Section 11 would require that all expenditures authorized
by this bill be made not later than September 30, 2001. Any
funds that have not been obligated by that date shall be deemed
unexpendable and shall be rescinded. In general, each
provisions of H.R. 2213 specifies that payments are to be made
to eligible producers who previously received a similar payment
or directly to states. Hence, USDA would not be required to
undertake a lengthy sign-up process to determine who is
eligible for payments. CBO estimates that all the authorized
payments would be made by September 30.
Pay-as-you-go considerations: The Balanced Budget and
Emergency Deficit Control Act sets up pay-as-you-go procedures
for legislation affecting direct spending or receipts. The net
changes in outlays that are subject to pay-as-you-go procedures
are shown in the following table. For the purposes of enforcing
pay-as-you-go procedures, only the effects in the current year,
the budget year, and the succeeding four years are counted.

----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-----------------------------------------------------------------------------
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
----------------------------------------------------------------------------------------------------------------
Changes in outlays................ 5,500 0 0 0 0 0 0 0 0 0 0
Changes in receipts............... Not applicable
----------------------------------------------------------------------------------------------------------------

Intergovernmental and private-sector impact: H.R. 2213
contains no intergovernmental or private-sector mandates as
defined in UMRA. The bill would authorize grants to states for
activities to promote agriculture and for support of certain
specialty crops. In addition, the bill would authorize payments
to tobacco producers in certain states, but would make the
payment to producers in Georgia's contingent upon any agreement
by the state to make payments to those same producers totaling
$13 million. Any such payments by the state would be voluntary.
Estimate prepared by: Federal Costs: Jim Langley, Dave
Hull, Greg Hitz and Valerie Baxter. Impact on State, Local, and
Tribal Governments: Marjorie Miller. Impact on the Private
Sector: Lauren Marks.
Estimate approved by: Robert A. Sunshine, Assistant
Director for Budget Analysis.

Performance Goals and Objectives

With respect to the requirement of clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives, the
performance goals and objectives of this legislation are to
provide economic assistance for producers to be used in the
2001 Fiscal year that expires September 30, 2001.

Constitutional Authority Statement

Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds the
Constitutional authority for this legislation in Article I,
clause 8, section 18, that grants Congress the power to make
all laws necessary and proper for carrying out the powers
vested by Congress in the Constitution of the United States or
in any department or officer thereof.

Committee Cost Estimate

Pursuant to clause 3(d)(2) of rule XIII of the Rules of the
House of Representatives, the Committee report incorporates the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to sections 402 and 423 of the
Congressional Budget Act of 1974.

Advisory Committee Statement

No advisory committee within the meaning of section 5(b) of
the Federal Advisory Committee Act was created by this
legislation.

Applicability to the Legislative Branch

The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act (Public Law
104-1).

Federal Mandates Statement

The Committee adopted as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act (Public Law 104-4).

Changes in Existing Law Made by the Bill, as Reported

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):

SECTION 1121 OF THE AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG
ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS ACT, 1999

SEC. 1121. INDEMNITY PAYMENTS FOR COTTON PRODUCERS.

(a) * * *
[(b) Conditions on Payment to State.--The Secretary of
Agriculture shall make the payment to the State of Georgia
under subsection (a) only if the State also contributes
$5,000,000 to the indemnity fund and agrees to expend all
amounts in the indemnity fund by not later than January 1,
2001, to provide compensation to cotton producers as provided
in such subsection. If the State of Georgia fails to make its
contribution of $5,000,000 to the indemnity fund by July 1,
1999, the funds that would otherwise be paid to the State shall
be available to the Secretary for the purpose of providing
partial compensation to cotton producers as provided in such
subsection.]
(b) Conditions on Payment to State.--The Secretary of
Agriculture shall make the payment to the State of Georgia
under subsection (a) only if the State--
(1) contributes $5,000,000 to the indemnity fund and
agrees to expend all amounts in the indemnity fund by
not later than January 1, 2002 (or as soon as
administratively practical thereafter), to provide
compensation to cotton producers as provided in such
subsection;
(2) requires the recipient of a payment from the
indemnity fund to repay the State, for deposit in the
indemnity fund, the amount of any duplicate payment the
recipient otherwise recovers for such loss of cotton,
or the loss of proceeds from the sale of cotton, up to
the amount of the payment from the indemnity fund; and
(3) agrees to deposit in the indemnity fund the
proceeds of any bond collected by the State for the
benefit of recipients of payments from the indemnity
fund, to the extent of such payments.
(c) Reporting Requirements.--[Upon the establishment of the
indemnity fund, and not later than October 1, 1999, the] The
State of Georgia shall submit a report to the Secretary of
Agriculture and the Congress describing the State's efforts to
use the indemnity fund to provide compensation to injured
cotton producers.
[(d) Additional Disbursement.--
[(1) Cotton stored in georgia.--The State of Georgia
may use funds remaining in the indemnity fund
established in accordance with this section to
compensate cotton producers in other States who stored
cotton in the State of Georgia and incurred losses in
1998 or 1999 as the result of the events described in
subsection (a).
[(2) Ginners and others.--The State of Georgia may
also use funds remaining in the indemnity fund
established in accordance with this section to
compensate cotton ginners and others in the business of
producing, ginning, warehousing, buying, or selling
cotton for losses they incurred in 1998 or 1999 as the
result of the events described in subsection (a), if--
[(A) as of March 1, 2000, the indemnity fund
has not been exhausted,
[(B) the State of Georgia provides cotton
producers an additional time period prior to
May 1, 2000, in which to establish eligibility
for compensation under this section;
[(C) the State of Georgia determines during
calendar year 2000 that all cotton producers in
that State and cotton producers in other States
as described in paragraph (d)(1) have been
appropriately compensated for losses incurred
in 1998 or 1999 as described in subsection (a);
and
[(D) such additional compensation is not made
available until May 1, 2000.]
(d) Additional Disbursement to Cotton Ginners.--The State of
Georgia shall use funds remaining in the indemnity fund, after
the provision of compensation to cotton producers in Georgia
under subsection (a) (including cotton producers who file a
contingent claim, as defined and provided in section 5.1 of
chapter 19 of title 2 of the Official Code of Georgia), to
compensate cotton ginners (as defined and provided in such
section) that--
(1) incurred a loss as the result of--
(A) the business failure of any cotton buyer
doing business in Georgia; or
(B) the failure or refusal of any such cotton
buyer to pay the contracted price that had been
agreed upon by the ginner and the buyer for
cotton grown in Georgia on or after January 1,
1997, and had been purchased or contracted by
the ginner from cotton producers in Georgia;
(2) paid cotton producers the amount which the cotton
ginner had agreed to pay for such cotton received from
such cotton producers in Georgia; and
(3) satisfy the procedural requirements and deadlines
specified in chapter 19 of title 2 of the Official Code
of Georgia applicable to cotton ginner claims.

ADDITIONAL VIEWS

H.R. 2213, as reported by the Agriculture Committee will
provide $5.5 billion in much needed assistance this year. This
legislation represents a meaningful first step in keeping
Congress' commitment to stand by our farmers and ranchers each
year until a permanent safety net is put in place.
However, H.R. 2213 as reported by the Agriculture Committee
is inadequate in at least two respects. First, the assistance
level is not sufficient to address the needs of farmers and
ranchers in the 2001 crop year. Second, the bill's scope is too
narrow, leaving many needs completely unaddressed.
At a time when real net cash income on the farm is at its
lowest level since the Great Depression and the cost of
production is expected to set a record high, H.R. 2213 as
reported by the Committee cuts supplemental help to farmers by
$1 billion from last year to this year. Hardest hit will be
wheat, corn, grain sorghum, barley, oats, upland cotton, rice,
soybean, and other oilseed farmers since the cuts will come at
their expense.
H.R. 2213, as reported by the Committee, also fails to
address the needs of dairy farmers, sugar beet and sugarcane
farmers, farmers who graze their wheat, barleys, and oats, as
well as farmers who are denied marketing loan assistance either
because they don't haven an AMTA contract or because they lost
beneficial interest in their crops.
Earlier this year, 20 farm group pegged the need in farm
country for the 2001 crop year at $9 billion. And, while most
of these groups acknowledge that limited federal resources
cannot possibly accommodate that level of supplemental
assistance, the farmers they represent--and their lenders--had
every reason to believe that the help this year would be at
least comparable to the help Congress provided last year. Since
H.R. 2213 as reported will not meet expectation, it is our
sincere hope that the fallout in farm country as a result of
this bill's passage will be limited to mere disappointment.
H.R. 2213, as originally introduced provided a level of
support that more closely reflected the expectations and actual
needs in farm country. The $6.5 billion measure provided the
same level of assistance to producers of staple crops as last
year; increased assistance to producers of specialty crops over
last year through purchases that would have moved the market
without damaging prices in the long term; assisted producers of
sugar, dairy, peanuts, tobacco, wool and mohair; producers who
graze their wheat, barley, and oats; as well as producers who
are denied marketing loan assistance either because they don't
have an AMTA contract or they lost beneficial interest in their
crops.
Those who championed H.R. 2213 as reported by this
Committee argued, in part, that a cut in help to farmers this
year is necessary to save money for a rewrite of the Farm Bill.
But, the fly in the ointment is that many farmers are deeply
worried about whether they can make it through this year, let
alone next year.
As this process moves forward, we will work to build a more
sturdy bridge over this year's financial straits--straits that
man otherwise threaten to separate many farmers from the
promise of the next farm bill.
Larry Combest, Chairman.
Charles W. ``Chip'' Pickering.
Dennis R. Rehberg.
Mike Pence.
Sam Graves.
Tom Osborne.
Mark R. Kennedy.
Terry Everett.
Ronnie Shows.
Robin Hayes.
Michael K. Simpson.
Doug Ose.
Frank D. Lucas.
John R. Thune.
William L. Jenkins.
Bob Riley.
Jerry Moran.